A fan of bitcoin and Twitter, Salvadoran President Nayib Bukele cultivates a cool and hip image. But the way he handled the forced-march bitcoin transition lacks nuance and pedagogy.
” In three minutes we make history. Salvadoran President Nayib Bukele could not fail to Tweeter today: it is this Tuesday, September 7, 2021 that his project to make bitcoin legal tender in the country is launched. And the 40-year-old president knows how to get people talking about his news. A fan of bitcoin, he regularly cracks little insider jokes (on his old profile photo, he displayed the famous “laser eyes” that the crypto community loves). If he cultivates his image as a “cool” president, the way in which he led the bitcoin transition in his country is far from it, however.
Making bitcoin legal tender will have a big impact on the Salvadoran population and is a very risky bet. However, the implementation of this project was done in a very rushed manner. ” The law was passed extremely quickly, without technical study or public debate », Deplores Salvadoran economist Ricardo Castañeda in the columns of The Guardian. Between the approval of the bitcoin law and its entry into force, barely three months have passed.
Half of the population does not “know anything” about bitcoin
As a result, the project worries a good part of the population of the country. According to a survey conducted in July, only 20% of residents approved of this transition. This is not the most problematic figure, however. This same survey reveals that 45% of those polled do not “know anything” about bitcoin and how it works. A figure which shows to what extent the government did not make enough efforts to explain the project to the population.
Individuals are admittedly not required to use cryptocurrency – the dollar has been legal tender in the country since 2001 and will retain that status. But it is essential that they have the basics to make an informed decision whether they want to use it or not. Especially since even those who choose not to use bitcoin will still be indirectly affected by this change: it is possible that the bitcoin transition will boost the Salvadoran economy (hopefully), but it is also possible that it destabilizes it, as we explained here.
Attract wealthy crypto enthusiasts
Nayib Bukele unveiled quite a few measures intended to attract wealthy bitcoin enthusiasts (tax and visa exemptions offered to all people with 3 or more bitcoins). However, he was less verbose on the measures that will help all of its citizens to use this cryptocurrency on a daily basis. Of course, everyone will be given the equivalent of $ 30 in bitcoin (they will just have to download the Chivo digital wallet). But that does not solve the problem of the very large part of the population (45%) who do not have access to the internet.
This very cavalier way of leading the bitcoin transition in his country is hardly surprising, however. Nayib Bukele likes to portray himself as cool and enjoys very broad support from his population: 92% of Salvadorans have a good opinion of him. The Salvadoran president has nevertheless sometimes shown a more authoritarian face. In February 2020, blocked by an opposition hostile to any concession, he had sought to intimidate his opponents by entering the chamber accompanied by soldiers. And the international community has sharply criticized the way in which its parliamentary majority abruptly removed the judges from the constitutional court and the prosecutor. If he wants the population to continue to approve his action, he will probably have to curb this abrupt side and show more nuance and pedagogy on the subject of cryptocurrencies.