El Salvador Struggles with Technical Issues as Crypto Joins Economy

September 07, 2021

At the beginning of this month, El Salvador made a huge leap forward in technological advancement by becoming the first country to fully accept bitcoin as an official form of payment. Though the adoption is certainly a noteworthy achievement for the country, the initial rollout has been plagued with a number of complications.

For starters, the government-backed digital wallet created by Chivo was found to be unavailable in the app store for some users. Those who were able to download the app also ran into problems, as the government revealed the program was shut down so that more servers could be connected to managed the high demand. The launch failures also caused frustrations for those looking to take advantage of a promotional offer, which promised $30 worth of bitcoin after signing up.

While the country has received praise for advocating cryptocurrencies and blockchain technology, the problems during the launch have spark concerns about becoming too dependent on digital resources for financial services. Not only that, but launching such programs without a complete strategy could have disastrous consequences for those heavily invested in the crypto market.

Although El Salvador’s system did not begin with a smooth start, some citizens are still hopeful about the overall benefits of wide crypto adoption. Many are celebrating the fact that a number of financial processes, such as national money transfers, can be initiated without additional fees, which ultimately results in cost savings. Citizens without bank accounts would also be able to join, which would add a new level of security for those who chose not to deal with traditional financial institutions.

"Like all innovations, El Salvador's bitcoin process has a learning curve," Tweeted President Nayib Bukele "Not everything will be achieved in a day, or in a month."

Edited by Maurice Nagle

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