After announcing Bitcoin as a legal tender of El Salvador in June, El Salvador is now gearing to launch a government-issued Bitcoin wallet called ‘Chivo’. The wallet will be available to download from the app store from September 7.
To encourage the use of Bitcoin, Chivo announced that it will distribute $30 worth of Bitcoin to every individual who downloads the wallet. However, it was reinstated that the use of Bitcoin and Chivo is not mandatory, and is completely up to the users’ discretion.
El Salvador’s president Nayib Bukele passed a bill in June this year that officially recognized Bitcoin as the legal tender of the country. The ‘Bitcoin Law’ stipulated that Bitcoin would be used as the national currency along with the US Dollar.
Before the announcement, the US Dollar was the only official currency of El Salvador since 2001. Bitcoin, as the legal currency, would come into effect from September 7 along with the launch of the government’s wallet ‘Chivo’.
In the announcement, President Bukele reemphasized that Bitcoin adoption is not compulsory. He mentioned some of the negative voices over the recent move, however, he believed the benefits would soon outweigh.
Some of the benefits of ‘Chivo’ include the automatic conversion of Bitcoin transactions into dollars. Users can also store their Bitcoins in the wallet and later cash them out at the newly installed 200 of El Salvador’s ATMs.
Additionally, there will be 50 places called ‘Punto Chivos’ where individuals can make deposits and withdrawals and will act as a crypto education center as well.
Those without citizenship of the country can also access the wallet to give tips to tourist workers.
It was announced in the Bitcoin Law that products could be valued in Bitcoin units and taxes could be paid in Bitcoin as well. The English translation of the bill noted:
“In order to promote the economic growth of the nation, it is necessary to authorize the circulation of a digital currency whose value answers exclusively to free-market criteria, in order to increase national wealth for the benefit of the greatest number of inhabitants.”
