Bitcoin democratizes electronic payments, potentially benefiting the 70% of El Salvador’s adult population that remains without banking services
A report through Bank of America (BofA) highlighted some of the potential benefits that may arise in El Salvador following the historic adoption of Bitcoin as a legal tender by the Central American nation. Published last week, the monetary institution’s report identifies key spaces where the use of Bitcoin can have a primary impact.
According to BofA analysts, BTC’s popularity is expected to sing up the country’s remittance sector, with the sector contributing only about 25% of El Salvador’s GDP. The use of Bitcoin will decrease the amount paid in transaction fees when using classic channels.
In this case, Bitcoin becomes “an intermediary for cross-border transfer”, and Salvadorans save even when they convert the BTC won into dollars. income.
Another merit is the monetary freedom that can be granted to the approximately 70% of the country’s population that remains unbanked. Financial digitization is a key merit of cryptocurrency, which, according to the report, is a plus for those who cannot open. a bank account.
The adoption of Bitcoin also gives the population a greater selection of consumers, the bank adds. “We do not agree with the concept that it is coercive for corporations to be legally required to settle for Bitcoin as a payment method,” the bank wrote. adding that businesses and consumers will have the freedom to use cryptocurrencies or use dollars directly from their “Goat” wallets.
Bank of America also believes El Salvador has a lot to gain from becoming a Bitcoin hub, which analysts note will be the case when it begins to attract foreign direct investment in preparation for advances similar to Bitcoin mining.
The report is unexpected given BofA’s “icy” attack on BTC in its March report which noted that Bitcoin had “dirty little secrets” and was not good, for speculative trading. It also follows a recent complaint from the IMF and the United Nations Economic Commission for Latin America and the Caribbean.
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