José Luis Guillén, CEO of Coincaex, believes that the economic transformation is already underway. The Central American nation now faces the challenge of educating the population about cryptocurrencies.
The adoption of Bitcoin (BTC) in Central America is just in its infancy but could soon take a giant leap. José Luis Guillén, CEO of Coincaex, El Salvador’s first exchange, recently made that prediction about the cryptocurrency. That country will recognize the crypto assets as legal tender from September 7th.
The Guatemalan businessman decided to change the operations center of his company when the approval of the Bitcoin Law happened. For that reason, he moved to the nation that was adjusting its legal framework to drive the adoption of cryptocurrency.
Two months after arriving in El Salvador, he anticipates that the country will become the financial center of the American continent. He even compares it to Singapore, which used to be a poor island and is now one of the wealthiest countries. While one has focused its economic growth on the US dollar for more than half a century ago, the other is doing so now based on Bitcoin.
The law will enter into force in a few days, but the first stage of development of its economic transformation is already underway. Gillén said that many new companies are moving capital in the country while others have opened offices or plan to start some operations.
The need for a regulation that encourages the market explains the meaning that the Bitcoin Law of El Salvador has for the industry, Guillén explains.
El Salvador’s Great Challenge is to Educate About Bitcoin
Faced with the challenges after the approval of the Bitcoin Law, Guillén notes that the key to driving adoption is education. He comments that the lack of information among citizens leads them to fear using the cryptocurrency.
Education is essential for people to understand that Bitcoin is a store-of-value asset and not a quick-win asset, Guillén says. He adds that increased awareness of how the protocol works will allow the adoption to gain momentum more organically. In other words, not everything will depend solely on the price rise, as is currently the case.
Latin American economics schools should be honest about the history of money as they focus on a central banking model that no longer works. As inflation hits the most vulnerable people very hard, Guillén considers it necessary to focus on the new models of digital scarcity.
Guillén believes that the adoption of Bitcoin will come from the private sector, especially when the US dollar bubble is about to burst. When it happens, people and companies will seek to safeguard their reserves to protect themselves against hyperinflation and the economic crisis.
El Salvador Prepares to Comply with International Regulations
El Salvador is conditioning its infrastructure to comply with international regulations before the Bitcoin Law enters into force. In addition, President Nayib Bukele already has a draft ready for the new National Constitution of that Central American country.
That Magna Carta will include digital currencies as constitutional, thus endorsing the use of non-physical, non-specific currencies. However, no one knows yet which cryptocurrencies the article of the law will cover.
By Alexander Salazar
