Although it was billed as “one of the biggest announcements in the history of bitcoin”, it appears that the market historically suggests the current president of El Salvador to recognize bitcoin as legal tender. will present the law.
In a presentation at Bitcoin 2021 by Zap CEO Jack Mallers – the developers of an earlier low-profile Lightning Network wallet app called Strike – Mallers showed a short video of Salvadoran President Nayib Bukele where the leader of the 104th largest global economy held a historic declare. Legislation. Strike currently has a 3.2 out of 5 star rating on the Google Play store.
“Next week, I will send a bill to Congress that makes bitcoin legal money,” Bukele said in the video.
— nayibbukele (@nayibbukele) June 5, 2021
Bukele, who is known as a strongman and an autocrat, strengthened his power last month by firing five judges as well as the country’s attorney general. A recent Reddit thread from a self-proclaimed Salvadorian framed the move as one that would Popular Bukele’s majority party as well as the general public.
The move has been long awaited in bitcoin circles, with some speculating that nation-states will accept, transact and hold the world’s largest digital asset as part of the Treasury Reserve.
A tweet thread by bitcoin advocate Kaitlyn Long explained that this could be a “back door” way for banks to handle and hold BTC:
1/ Thread about a historical day #bitcoin: #El Salvador President publicly declares support for legislation #B T c legal tender. *If* this becomes law, it will have many secondary effects. steel yourself for a big fight over this is probably going to comehttps://t.co/BrrNxaLzpZ
— Caitlin Long (@CaitlinLong_) 6 June 2021
While the announcement generated widespread enthusiasm for the conference, the market reaction was muted. BTC is effectively flat on a 24-hour basis, and is down 3.5% on a 14-day basis.
Part of the muted response may be partly due to the precise nature of the announcement being unclear. A self-described hacker on Twitter noted that the strike is not trustworthy and is censorable, meaning that implementing BTC as legal tender would not be the anarchic-capitalist utopia that some holders have long wanted.
Tried to install Strike, the app that will be used to pay with bitcoin in El Salvador. It looks like it’s not permissioned and custodial, which means they can block your account and money at any time.https://t.co/9wRD5w8DVo pic.twitter.com/wy6N1nIgp0
— Patrick Aljord (@patcito) 6 June 2021
While this hasn’t moved the markets, Bukele noted in a recent tweet that the new policy could be a significant boon for many Salvadorians, especially the over 70% of the population who do not have a bank account. Regardless of technical:
“Financial inclusion is not only a moral imperative, but also a way to develop the country’s economy, providing access to credit, savings, investments and secure transactions.”