Beautiful Virgin Islands

Sunday, Aug 09, 2026

As El Salvador Makes Cryptocurrency Legal Tender is It the Beginning of the End for Dollar Hegemony?

As El Salvador Makes Cryptocurrency Legal Tender is It the Beginning of the End for Dollar Hegemony?

The idea of cryptocurrency was first conceived in the 1980s but it was not until 2009 that the first open-sourced software, Bitcoin, was released. There are now dozens of blockchains but they have until not been regarded as legal tender.

El Salvador will make history on Tuesday, 7 September, when it becomes the first country in the world where cryptocurrency is officially legal tender and can be used to buy a house or a car or even to pay your taxes.

Supporters of cryptocurrency hope it could mark the beginning of the end of the "dollar hegemony."

In 2019, the dollar was responsible for 88 percent of global trade but cryptocurrencies such as Bitcoin could offer an alternative, especially for smaller countries who are prone to economic bullying.

A poll by the Central American University, published on Thursday 2 September, found two-thirds of Salvadoreans were opposed to allowing cryptocurrencies to be legal tender, although it appeared to be driven by ignorance.


​Of 1,281 people surveyed nine out of 10 people did not have a clear understanding of how Bitcoin worked and 70 percent thought the government should repeal the law, passed in June, allowing it to be legal tender.

El Salvador’s President Nayib Bukele, who proposed the idea, believes cryptocurrency can help boost jobs and economic development by making the country less reliant on US dollars.

Unemployment is around seven percent in El Salvador but the majority of the population live on low wages and grinding poverty, as well as high levels of crime, have persuaded tens of thousands to head north to the “promised land” of the United States.

The sun rises as asylum-seeking migrants' families from Honduras and El Salvador walk towards the border wall after crossing the Rio Grande river into the United States from Mexico on a raft, in Penitas, Texas, U.S., March 26, 2021


There are 1.5 million Salvadoreans in the US, compared to six million in El Salvador itself, and another 40,000 live in Honduras, Guatemala or Mexico, often having abandoned the migrant journey north.

Seven out of 10 people in El Salvador do not have bank accounts and President Bukele believes cryptocurrency will make it easier for migrants in the US to send remittances back to their family without having to pay the charges demanded by banks and firms like Western Union.

Remittances - around US$4 billion a year - makes up around a fifth of the country's GDP.


Mr Bukele, a former businessman of Palestinian origin, has portrayed the cryptocurrency move as a way for El Salvador to dig itself out of its economic mire.

"This will improve lives and the future of millions," Mr Bukele told a Bitcoin conference in Florida in June.

President Nayib Bukele holds his ballots as he prepares to vote in local and legislative elections, at a polling station in San Salvador, El Salvador, Sunday, Feb. 28, 2021


But the UCA survey found most Salvadoreans think foreign investors and the country’s wealthy elite will be the only beneficiaries.

"The dean of UCA, Andreu Oliva, said: "What we can see in this survey, in addition to this broad rejection of the implementation of Bitcoin as legal tender, is that for the first time we found a significant disagreement between the population and decisions being made by the Legislative Assembly and the president.There is a lot of concern about the possible negative effects of using Bitcoin."


But if cryptocurrency works in El Salvador, and if it boosts the economy and draws in inward investment, then it could well be copied by other impoverished states like Honduras, Haiti, Zimbabwe, Liberia and Sierra Leone.

Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Meta Ordered to Pay $567 Million and Change Facebook and Instagram Safeguards for Children
Up to only 10 Months in Prison for Swedish Officer’s Murderer Sparks Anger
Success: Nvidia Turned Gaming Chips Into the Engine of the AI Boom
Jorge Messi, Lionel Messi’s Father and Longtime Agent, Dies at 68
AI’s Next Bottleneck Is Power, Not Just Nvidia Chips
Advertising trick: Pepsi’s Harrier Jet Commercial Led to a $700,000 Court Fight
Meta Raises AI Spending Target to as Much as $145bn Despite Pressure Over Returns
Danube Drought Exposes Nazi Wrecks and Pushes Central Europe’s Power System to the Brink
Joe Biden’s Cancer Has Spread Beyond His Bones, Hunter Biden Says
Air Traffic Control Outage Grounded Flights Across the Midwest
Why 2027 Could Be a Strong Year for Stocks—and Why the Forecast Is Fragile
Why Markets May Look Quiet in August After Big Tech Earnings
Australian Crew Evacuates Seriously Ill American From Antarctica in Midwinter Darkness
Trump’s Top General Seeks an Exit Strategy From Iran War, Report Says
Brock Lesnar Retires From Wrestling, Closing a Career of Rare Athletic Range and Lasting Controversy
Trump-Era Policy Shifts Test the Boundaries of U.S. Institutions
UK Drought Cuts Harvests and Raises Food-Security Fears
UFO: Pentagon Releases Video of Unidentified Object Tracked Over Middle East
US Health Secretary: “I’m Not Afraid of Germs — I Used to Snort Cocaine Off Toilet Seats”
Ukraine Tells Senate Republicans Its Drone War Offers a Blueprint for America
Weight-Loss Drug Boom Tests the Limits of Prescription Advertising Rules
Trump Keeps Hegseth at Pentagon While Leaving Door Open for DeSantis
UK Clears Paramount’s Warner Bros. Discovery Deal, but US Trial Looms
UK Prosecutors Add 38 Charges Against Andrew and Tristan Tate
Taiwan’s President Joins Wartime Command Drill as China Pressure Grows
Saudi Arabia, Turkey and Pakistan Sign Mutual-Defence Pact
HMRC’s 2029 Tax Shift Could Overlap Old and New Self-Assessment Bills
Thetford Disorder Prompts Expanded Police Powers Amid Asylum-Housing Protests
Cambridge Faces Calls for Independent Review of Jason Arday Appointment
Scotland’s ‘Cock of the North’ Woodland Is Being Felled After Wind Damage
Reform UK and Greens Unite Against Vast Solar Plans for Kent Marshland
New Zealand Draws Wealthy Americans With Revamped Investor Visa
Senate Panel Votes to Hold Anthony Fauci in Contempt After Fifth Amendment Testimony
Cambridge Professor Jason Arday Resigns as University Opens Inquiry Into His Credentials
Manchester Power Failure Disrupts Trains Across North West Into Friday
Lightning Strike Kills Yala FC Player During Match in Southern Thailand
Senate Scrutinises AI-Driven Personalised Pricing
Spain Seeks Mainland Transfers for 1,100 Children Stranded in Ceuta
Spain and Morocco Trade Blame After 72,000 Migrants Enter Ceuta
Met Police Investigated Journalist Who Questioned Cambridge Professor
Badenoch Defends Tory Candidate Jailed for Antisemitic Abuse of Luciana Berger
NHS Spends £240m a Year Storing Paper Records Despite Digital Push
Apple Seeks Court Order to Stop OpenAI Using Alleged Trade Secrets
Breaking With the Past: One of the World’s Smallest Countries Changes Its Name
AI Is Remaking the US Economy, From GDP Growth to iPhone Prices
Comcast: Tied to a Chair and Hit in the Face With Cake: The Regular Humiliation Ritual at the US Corporate Giant
Aston Martin Faces Legal Threat Over £550m Rescue Deal
Reform UK Wants the Royal Navy to Return Channel Boats to France
US and Japan Step In to Support the Yen in Rare Joint Intervention
The AI Pricing Problem: Companies Cannot Predict Their Own Bills
×