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<ul class="summary-list"><li><keyword id="68460" type="COUNTRY" weightage="60" keywordseo="El-Salvador">El Salvador</keyword> is planning to give $30 in <keyword id="6354947" type="UNKNOWN" weightage="60" keywordseo="bitcoin">bitcoin</keyword> to citizens who download the government's crypto app, Chivo.</li><li>The initiative comes as the much-anticipated "<keyword id="11412135" type="UNKNOWN" weightage="60" keywordseo="bitcoin-law">Bitcoin Law</keyword>" takes effect on September 7.</li><li>President Nayib <keyword id="11188607" type="LOCATION" weightage="60" keywordseo="bukele">Bukele</keyword> in a national address explained how the landscape would look like for 6.5 million Salvadorans.</li></ul>El Salvador is planning to give $30 in bitcoin to citizens who download the government's cryptocurrency app, <a href="https://twitter.com/PresidenciaSV/status/1408255451989524480">Chivo</a>, <a href="https://www.coindesk.com/bukele-bitcoin-law-el-salvador-september">CoinDesk</a> reported citing a <a href="https://www.elsalvador.com/noticias/negocios/bitcoin-criptomonedas-bukele-dinero/851974/2021/">local news outlet.</a>The initiative comes as the "<a href="https://markets.businessinsider.com/currencies/news/el-salvador-bitcoin-legal-tender-currency-cryptocurrency-2021-6-1030506569">Bitcoin Law</a>" takes effect on September 7, making the Central American country the first in the world to accept bitcoin as legal tender, alongside the US dollar.For over an hour on Thursday, President Nayib Bukele in a <a href="https://www.youtube.com/watch?v=zMqA9J8Y2i4">national address</a> explained how the landscape would look like for 6.5 million Salvadorans once the law goes into effect.For instance, bitcoin received as payment can be immediately converted to dollars. "The use of bitcoin will be optional, nobody will receive bitcoin if they don't want it," Bukele said, according to <a href="https://www.reuters.com/technology/bitcoin-become-legal-tender-el-salvador-sept-7-2021-06-25/">Reuters</a>. "If someone receives a payment in bitcoin they can choose to automatically receive it in dollars."The 39-year-old president added that salaries and pensions will continue to be paid in US dollars, but did not go into details on whether the law would affect only state workers or include private sector employees, <a href="https://www.reuters.com/technology/bitcoin-become-legal-tender-el-salvador-sept-7-2021-06-25/">Reuters</a> reported.Ever since the Bitcoin Law was approved in June by a supermajority - garnering 62 out of 84 votes - it has been met with some <a href="https://www.coindesk.com/deputy-of-el-salvador-opposition-party-files-lawsuit-against-bitcoin-legislation">opposition.</a> The International Monetary Fund has <a href="https://markets.businessinsider.com/news/stocks/imf-international-monetary-fund-risk-el-salvador-bitcoin-legal-tender-2021-6-1030512990" target="_blank" rel="noopener noreferrer">expressed concerns</a> over El Salvador's historic move, saying it raises a number of "macroeconomic, financial, and legal issues that require very careful analysis."Still, the millennial leader stands by his advocacy for the world's largest cryptocurrency by market capitalization."One of the reasons we passed the bitcoin law is precisely to help people who send remittances," Bukele said, according to <a href="https://www.reuters.com/technology/bitcoin-become-legal-tender-el-salvador-sept-7-2021-06-25/">Reuters</a>. El Salvador is among the countries that rely heavily on money sent back from workers abroad.<a href="https://data.worldbank.org/indicator/BX.TRF.PWKR.DT.GD.ZS?locations=SV&amp;most_recent_value_desc=falsealse">World Bank data</a> reveal that remittances to the country made up nearly 20% of its gross domestic product in 2019 - ranking among the highest in the world.Bukele has also <a href="https://markets.businessinsider.com/currencies/news/el-salvador-bitcoin-legal-tender-currency-cryptocurrency-2021-6-1030506569">cited</a> financial inclusion and economic growth as reasons for adopting bitcoin, given that 70% of citizens are unable to access "traditional financial services."

El Salvador will give $30 in bitcoin to citizens who download the government's crypto app before the token becomes legal tender in September

<ul class="summary-list"><li><keyword id="68460" type="COUNTRY" weightage="60" keywordseo="El-Salvador">El Salvador</keyword>'s approval of <keyword id="6354947" type="UNKNOWN" weightage="60" keywordseo="bitcoin">bitcoin</keyword> as legal tender could lead to an economic downturn, Steve Hanke predicted.</li><li>The <keyword id="6365396" type="ORGANIZATION" weightage="60" keywordseo="economist">economist</keyword> described members of government who passed the bitcoin law as "stupid".</li><li>He predicted bitcoin holders in Russia or China would target El Salvador to cash out their holdings.</li></ul>El Salvador's move to classify <a href="https://markets.businessinsider.com/currencies/news/el-salvador-bitcoin-legal-tender-currency-cryptocurrency-2021-6-1030506569">bitcoin as legal currency</a> has the potential to completely collapse its <keyword id="34412" type="ORGANIZATION" weightage="60" keywordseo="economy">economy</keyword>, Steve Hanke, professor of applied economics at Johns Hopkins University, said in a <a href="https://www.kitco.com/news/2021-06-15/Legalizing-Bitcoin-will-completely-collapse-El-Salvador-s-economy-Steve-Hanke.html">Kitco News interview</a> on Tuesday. After describing President Nayib Bukele and members of government who voted to pass the <a href="https://markets.businessinsider.com/currencies/btc-usd">bitcoin</a> law as "stupid," Hanke raised doubts about whether the cryptocurrency could work smoothly for everyday use in a country where most citizens don't have bank accounts.The economist, who served on former President Ronald Reagan's council of economic advisers in the 1980s, suggested criminal interests may have helped bring about the Latin American nation's adoption of cryptocurrency."The criminal element wants to be able to get in and actually obtain real legal greenbacks," he said. "They want greenbacks. And greenbacks are, in fact, the legal tender and money in El Salvador."Hanke predicted bitcoin holders in Russia or China would exploit El Salvador's citizens to cash out their holdings, ultimately draining the country of US dollars."It has the potential to completely collapse the economy, because all the dollars in El Salvador could be vacuumed up and there'll be no money in the country," he said. "They don't have a domestic currency."Governments and central banks around the world will be watching El Salvador's experiment to see whether bitcoin becomes part of daily life for payments and remittances.But Hanke called the idea crazy, saying the digital asset will need to be converted to US dollars to be used anywhere. "You're not going to pay for your taxi ride with a bitcoin, it's ridiculous," he said."If grandma is down in El Salvador waiting for her remittances, and you want to send it with bitcoin, that's fine. What does she do? She has to go to the ATM to get dollars, because that's the only way you can buy something," Hanke said. But the bitcoin bill mandates every business to <a href="https://www.bbc.co.uk/news/world-latin-america-57398274">accept the cryptocurrency as legal tender</a>, unless it doesn't have the technology to enable such a transaction. Further, the government is considering whether companies should <a href="https://twitter.com/DocumentingBTC/status/1404837371003215885">pay salaries in bitcoin</a>. JPMorgan said last week that it was difficult to see any benefits of adopting bitcoin as a second form of legal tender, and the move could risk relations with the International Monetary Fund.Read More: <a href="https://www.businessinsider.com/market-wizard-trader-trading-floor-strategy-citi-rates-deirdre-dunn-2021-6" target="_blank" rel="noopener noreferrer">Deirdre Dunn started her career winning a hamburger-eating contest on the trading floor at Goldman Sachs. Now she's one of Wall Street's star traders at Citigroup.</a>

El Salvador's 'stupid' decision to adopt bitcoin as legal tender could collapse the economy, economist Steve Hanke said

<ul class="summary-list"><li><keyword id="68460" type="COUNTRY" weightage="60" keywordseo="El-Salvador">El Salvador</keyword>'s president Nayim Bukele announced his country is exploring using volcanic energy to mine <keyword id="6354947" type="UNKNOWN" weightage="60" keywordseo="bitcoin">bitcoin</keyword>.</li><li>The move comes after El Salvador made bitcoin legal tender via a supermajority decision.</li><li>Bitcoin's price jumped roughly 10% on Wednesday to trade around $36,000.</li></ul>El Salvador's president Nayim Bukele <a href="https://twitter.com/nayibbukele/status/1402680890057166858">took to Twitter</a> on Wednesday for yet another big <a href="https://wazirx.com/signup?invite=2kpah6gr&amp;utm_source=business-insider&amp;utm_medium=referral&amp;utm_campaign=microsite" id="docs-internal-guid-b9e43547-7fff-bfd2-c67c-e9787abebf89">bitcoin</a> announcement. This time, Bukele said that he has instructed the president of the country's state-owned geothermal electric company, LaGeo SA de CV, to "put up a plan to offer facilities for #Bitcoin mining with very cheap, 100% clean, 100% renewable, 0 emissions energy from our volcanos." The move comes after the country passed a law to make <a href="https://markets.businessinsider.com/currencies/news/el-salvador-bitcoin-legal-tender-currency-cryptocurrency-2021-6-1030506569">bitcoin legal tender</a> on Wednesday via a supermajority (62 votes out of 84 possible). Bitcoin's price rose roughly 10% on Wednesday to trade around $36,000 per coin after the bullish news broke. Bitcoin mining's energy-intensive nature has led critics to question its environmental impact over the past few years. According to <a href="https://cbeci.org/cbeci/comparisons">data from Cambridge</a>, the <a href="https://wazirx.com/signup?invite=2kpah6gr&amp;utm_source=business-insider&amp;utm_medium=referral&amp;utm_campaign=microsite" id="docs-internal-guid-b9e43547-7fff-bfd2-c67c-e9787abebf89">bitcoin</a> network's total energy consumption represents about 0.53% of total global energy consumption, and more than 85% of the energy consumed is used in the mining process. Critics have argued bitcoin mining could <a href="https://www.businessinsider.com/elon-musk-tesla-bitcoin-bad-for-the-environment-carbon-emissions-2021-5">exacerbate climate change</a>, while others, including Cathie Wood of ARK Invest, have said that bitcoin's power use will only help <a href="https://markets.businessinsider.com/currencies/news/cathie-wood-bitcoin-energy-use-concerns-boost-renewable-mining-solar-2021-6-1030505197">boost the adoption</a> of renewable mining and solar power. In other crypto news, Coindesk reported Chinese consumers are currently unable to search for popular cryptocurrency exchanges including Binance, OKEx, and Huobi on popular Chinese search engines in a sign of potential censorship. China has been cracking down on cryptocurrency mining for some time, even going so far as to <a href="https://markets.businessinsider.com/currencies/news/china-crypto-crackdown-weibo-bitcoin-influencers-accounts-blocked-2021-6-1030499644">block the social media accounts</a> of prominent crypto influencers over the weekend. Last month, <a href="https://markets.businessinsider.com/currencies/news/bitcoin-price-china-crypto-miners-halt-operations-2021-5-1030458013?utm_source=markets&amp;utm_medium=ingestgest">crypto miners were forced to halt operations in China</a> after the country implemented tighter regulations. Chinese government officials have previously stated they would target the crypto industry to try to reach net-zero emissions by 2060. <a href="https://forum.businessinsider.in/">For a more in-depth discussion, come on over to Business Insider Cryptosphere</a> — a forum where users can deep dive into all things crypto, engage in interesting discussions and stay ahead of the curve. SEE ALSO: <a href="https://www.businessinsider.in/cryptocurrency/news/investments-in-crypto-hit-17-billion-in-the-first-six-months-of-2021/articleshow/83740327.cms">Investments in crypto hit a new record of $17 billion, but Indian funds are yet to jump on the bandwagon</a> <a href="https://www.businessinsider.in/cryptocurrency/news/indian-cryptocurrency-exchange-wazirx-has-listed-shiba-inu-tokens-for-trading-in-indian-rupees/articleshow/82731429.cms">Chiacoin claims to be an eco-friendly cryptocurrency — here's how it works</a> <a href="https://www.businessinsider.in/cryptocurrency/news/here-is-why-a-ban-on-cryptocurrencies-may-not-be-even-possible/articleshow/82741310.cms">Is a ban on cryptocurrencies even possible?</a> <a href="https://www.businessinsider.in/cryptocurrency/news/latin-america-and-south-asia-show-two-ends-of-the-crypto-regulatory-spectrum/articleshow/83638437.cms">Even as Latin America embraces Bitcoin, Southeast Asia is clamping down on cryptocurrencies</a>

The president of El Salvador says the country is exploring using geothermal energy from volcanoes to mine bitcoin following its decision to make the cryptocurrency legal tender

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El Salvador will give $30 in bitcoin to citizens who download the government's crypto app before the token becomes legal tender in September

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El Salvador's 'stupid' decision to adopt bitcoin as legal tender could collapse the economy, economist Steve Hanke said

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The president of El Salvador says the country is exploring using geothermal energy from volcanoes to mine bitcoin following its decision to make the cryptocurrency legal tender

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