El Salvador’s government continues on its path towards becoming the first crypto-based economy, as the president of El Salvador has announced the government will airdrop $30 worth of Bitcoin (BTC) to every adult citizen of the country.
Bitcoiners welcomed the decision, with traders speculating about El Salvador putting huge buying pressure on Bitcoin markets, as the $30 worth of Bitcoin would result in $100 million in Bitcoin purchases from the government.
According to estimations, Bitcoin’s global user base will grow by 2.5% thanks to the 4.5 million Salvadorans exposure to the world’s largest cryptocurrency.
Other estimations suggest El Salvador’s population is roughly 6.5 million, which ups the possible airdrop value to around $195 million.
However, the crypto-focused euphoria may be overrated, as El Salvador’s citizens will only receive the free Bitcoin after downloading the government-issued cryptocurrency wallet app.
Meanwhile, a representative of the U.S. company Athena confirmed the rumors about ATM deployment. Athena will push out 1500 ATM devices in the country.
Initially, a few dozen machines would be deployed, to set up a business model. Athena plans to invest more than $1 million to install cryptocurrency ATMs, targeting regions where residents receive remittances from abroad.
Currently, Athens deployed just a couple of ATMs – one in El Zonte beach, while the other is in El Tunco. The El Zonte beach ATM is part of an experiment called “Bitcoin Beach” providing a real-life use case about the town becoming one of the world's first crypto-only economies.
Matias Goldenhörn, Athena’s Latin America director, noted that Nayib Bukele, El Salvador’s President, had “presented us with a tough challenge of 1,500 ATMs, we will go for that, but in phases. We are a private company and we want to ensure that our development in the country is sustainable.”
"Initially we are going to bring dozens of machines, (we'll) test what the business model is like in El Salvador, which will probably be different than in the United States," Goldenhörn added.
El Salvador’s decision about transitioning towards making Bitcoin a legal tender came with regulatory pressure after an opposing political party filed a lawsuit against a recently passed bill, which officially recognizes Bitcoin as legal tender. Other opposition claimed that the new Bitcoin law could be unconstitutional and harmful to the country.
Despite the regulatory havoc, El Salvador acts as a motivation for other countries to take on the path of becoming crypto-oriented. For instance, Paraguay followed El Salvador’s use case and is working towards making Bitcoin (BTC) a legal tender.
"The bill will help position the country to trail the path of growth for the next generation,” Paraguay's parliament member Carlitos Rejala noted.