El Salvador Survey: 90% of Citizens Don't Use Bitcoin for Transactions
A recent survey conducted by the University of Central America (UCA) reveals that 90% of Salvadoran citizens do not use Bitcoin for daily transactions, despite the government’s decision to adopt it as legal tender in 2021. This finding highlights the growing divide between the government’s ambitious plans to integrate Bitcoin into the national economy and the actual behavior of its citizens.
El Salvador’s Bitcoin Experiment
In September 2021, El Salvador became the first country in the world to make Bitcoin an official currency, alongside the U.S. dollar. President Nayib Bukele positioned the move as a way to modernize the country’s economy, reduce reliance on remittances, and provide financial inclusion for the unbanked population. The government introduced the Chivo Wallet, which allowed citizens to transact in Bitcoin and provided $30 in Bitcoin to each Salvadoran as an incentive to jumpstart adoption.
The initiative also saw the installation of Bitcoin ATMs across the country to facilitate seamless crypto-to-cash conversions. However, despite these efforts, adoption has been slow. According to the UCA survey, a staggering 90% of Salvadorans still prefer to use the U.S. dollar for their everyday transactions.
Barriers to Adoption
The survey results echo the struggles many Salvadorans have faced since the rollout of Bitcoin. Many respondents cited Bitcoin's volatility as a major reason for their reluctance to use it as a daily payment method. The sharp fluctuations in Bitcoin’s value make it difficult for users to predict how much their holdings will be worth from one day to the next, posing a significant risk for both consumers and merchants.
Additionally, issues with the Chivo Wallet app, particularly around usability and technical glitches, have further contributed to the lack of enthusiasm for the cryptocurrency. The app was plagued with bugs and service disruptions during its initial rollout, causing frustration for users and merchants alike. Many small business owners also expressed concerns about the complexity of accepting Bitcoin and the possibility of losing money due to price volatility.
Public Perception of Bitcoin
According to the UCA survey, this skepticism is not new. An earlier survey conducted in 2022 found that more than 70% of Salvadorans had little confidence in Bitcoin as a legal tender. The ongoing lack of trust, combined with the challenges of implementation, has significantly slowed Bitcoin adoption across the country.
The findings reflect a broader issue of financial education and digital literacy, as many Salvadorans feel they lack the necessary knowledge to comfortably use cryptocurrency. Without sufficient understanding of how Bitcoin works or clear advantages over the U.S. dollar, it’s difficult for the population to embrace the change.
How This Impacts Spending Crypto?
For those looking to live on and spend crypto in their daily lives, the El Salvador experiment reveals key lessons about the importance of trust, stability, and infrastructure. While Bitcoin may offer exciting potential, its real-world adoption as a daily payment tool remains limited. This underscores the need for stable cryptocurrencies or mechanisms that can minimize volatility when using crypto for everyday purchases.
Moreover, the government’s ambitious plans have shown that simply introducing Bitcoin and promoting it with incentives is not enough. Merchant adoption, consumer education, and reliable infrastructure are critical for creating a functional ecosystem where crypto can be spent like cash.