KL Winterbourne Associates – El Salvador Looks to Bitcoin as New Legal Tender

President Nayib Bukele plans to formally recognize Bitcoin as currency, with some believing that Paraguay will follow suit.

Tokyo, Japan, July 05, 2021 --(PR.com)-- El Salvador is set to make history on September 7 as the first sovereign nation to employ Bitcoin as legal tender. President Nayib Bukele announced in a Bitcoin 2021 video broadcast that the Grand Alliance for National Unity party will implement new legislation that recognizes Bitcoin as formal currency.

Given the country’s complicated history with its own currency, this economic shift is naturally a point of public contention, say analysts at KL Winterbourne.

Based on the findings of a study published by Cambridge University Press, the 2001 decision to dollarize the economy, abandoning El Salvador’s Colon as currency, was vastly unpopular – with more than half of the population viewing the change as economically disadvantageous.

Analysts at KL Winterbourne Associates agree that while the decision lent a hand in globalizing El Salvador’s economy and minimizing interest rates, the nation has seen a slowdown in GDP growth.

However, Mr. Taku Ishikawa, Chief Finance Officer at KL Winterbourne Associates suggests that the implementation of Bitcoin as legal tender might make up for lost time and money. He asserts that the already formidable presence of Bitcoin in El Salvador is largely reflected in small business owners and entrepreneurs.

The recent use of Bitcoin as a payment method has led to increased success for individuals working in the tourism industry. Consequentially, Ishikawa suggests that a more structured and centralized governmental approach surrounding cryptocurrency will likely lead to economic expansion and inclusivity for El Salvadorians rather than purely benefitting those in power.

Word has spread that Paraguay will follow suit by similarly adopting Bitcoin into its legislature. In doing so, President Mario Abdo Benitez and the Colorado Party would make Paraguay the first South American country to legally instate the digital currency.

However, KL Winterbourne Associates’ CFO disregards the validity of the buzz around Paraguayan cryptocurrencies. He explains that the news regarding Paraguay establishing Bitcoin as legal tender is derived from the public misinterpretation of a possible bill to standardize cryptocurrency usage. Essentially, Paraguay is nowhere near inaugurating Bitcoin as legal tender when the possibility of merely regulating cryptocurrency is still up in the air.
KL Winterbourne Associates
Mr. Shohei Muramatsu