El Salvador’s Bitcoin Beach included in $203M tourism investment
Bitcoin Beach in El Salvador will receive infrastructure development as part of a $203 million government investment in the country’s beach tourism.
Some of the funds will be used to revitalize 15,000 square meters of El Zonte, which has become known as Bitcoin Beach due to the widespread use of the cryptocurrency there, President Nayib Bukele said in an announcement last week. The planned developments include a beach club, shopping center, car park and sewage treatment plant. The other part of the investment went to the Surf City project in nearby La Libertad.
Bitcoin Beach
The Bitcoin Beach project was founded three years ago with an anonymous endowment of digital currency in the beach town of El Zonte. Since then, entrepreneurs and tourists in the area have increasingly used Bitcoin to conduct transactions, while workers in the city receive their wages in the digital currency.
Bitcoin Beach’s success quickly gained attention, which later led to a national conversation about cryptocurrencies. This then led Bukele to introduce legislation that would legalize Bitcoin as legal tender in El Salvador, which passed shortly after.
Bitcoin as legal tender
The introduction of Bitcoin as legal tender took place on September 7, 2021, making El Salvador the first country in the world to set such a precedent. Despite warnings from prominent international organizations, Bukele has repeatedly doubled down, acquiring even more Bitcoin as the price has fallen over the past year.
In addition to giving a largely unbanked population access to financial services, Finance Minister Alejandro Zelaya said last month that the implementation of Bitcoin as legal tender had also attracted foreign investment and boosted tourism. Earlier this year, the country’s tourism minister revealed that tourism had increased by 30% since September. Meanwhile, Bukele recently attributed the recovery of El Salvador’s tourism industry to “Bitcoin and surfing.”
Despite these claims, not everyone has been happy with the policy change. When the plans were first announced last June, less than 20% of Salvadorans were positive, according to a survey conducted at the time. While many felt they would struggle to understand the technology well enough, others believed it would only further enable government corruption.
Business has also been less than enthusiastic. The adoption of Bitcoin use by businesses throughout El Salvador has been particularly slow. According to a survey conducted earlier this year, only 14% of respondents had transacted in Bitcoin since its introduction as legal tender in September.
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