El Salvador’s Legislative Assembly agreed earlier this week to create a $150 million Bitcoin Trust, intended to facilitate conversions from Bitcoin (BTC) to US dollars, while bolstering the development of crypto infrastructure and services across the country.
President Nayib Bukele, who ushered in the controversial legislation in June, reassured the local populace on several occasions that opting for Bitcoin instead of US dollars will remain a matter of choice and the newly formed trust is intended to help him keep his promise.
Funds redirected from a $500 million loan for economic recovery
“Initially, the fund will be $150 million with the possibility of increasing it,” the Minister of Economy María Luisa Hayém Brevé told elsalvador.com, while she commented on the voted initiative that is supposed to ensure Salvadorans can balance their crypto exposure.
The Development Bank of El Salvador (Bandesal) has been delegated to supervise the trust’s operation.
The $150 million will be redirected from the country’s $500 million loans with the Central American Bank for Economic Integration (CABEI), initially intended to support the economic recovery of small and medium-sized businesses.
While $150 million will go to Bandesal for the Bitcoin Trust, another $ 53,3 million is intended for the execution of the plan.
Of those funds, the government allocated $23,3 million toward rolling out crypto ATMs, while setting aside $30 million for incentivizing the use of El Salvador’s official Bitcoin wallet, dubbed Chivo.
FUD is natural
Along with disapproval and warnings on an international level, Bukele’s controversial move to recognize the world’s biggest crypto as a national currency on September 7 was met with a fair dose of uncertainty on the ground as well.
With anti-Bitcoin protests stirring up in the country’s capital ahead of legalization, the Salvadoran Association of International Cargo Carriers (ASTIC) requested that the state modify Article 7 of the Bitcoin Law, which mandates all companies and individuals in the country to accept the crypto as a form of payment.
According to Hayém Brevé, doubts and fear around the use of the new currency are natural, since the initiative, which put El Salvador at the forefront of financial technology, is novel and unexplored.
“We have several teams in the territory to show the population how to use the Chivo Wallet. We have developed a friendly application so that all Salvadorians can learn to use this cryptocurrency,” she added.
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