In a significant political development, El Salvador’s President Nayib Bukele, known for his pro-Bitcoin stance, was re-elected as President of El Salvador, according to exit polls.
Since taking office in 2019, Bukele has garnered attention for his policies to reduce gang violence and accept Bitcoin as fiat currency. This is a pioneering and controversial measure globally.
His administration’s introduction of the Chivo cryptocurrency wallet and investment in Bitcoin highlighted his commitment to cryptocurrencies. Despite facing international scrutiny, especially from the IMF, Bukele’s re-election with over 85% of the vote reflects widespread domestic support.
His next term is expected to focus on further integrating Bitcoin into the country’s economy, including launching Bitcoin-backed “volcano bonds” to finance renewable energy-based BTC mining. Bukele’s leadership continues to position El Salvador at the forefront of cross-border cryptocurrency adoption.
El Salvador Volcano Bonds, also known as “Bitcoin Bonds,” are a financial instrument proposed by the Government of El Salvador. The concept was introduced as part of the country’s broader plan to accept cryptocurrencies, particularly Bitcoin, as fiat currency, with El Salvador becoming the first country in the world to adopt it in September 2021.
However, using Bitcoin as fiat currency has caused some problems for residents. When Bitcoin transaction fees soared to a two-year high as Ordinals inscription soared in popularity, Salvadorans suddenly realized that processing payments in BTC was prohibitively expensive.
A user from that country pointed out: on twitter At that time, if you tried to send $100, you would incur a $20 fee.
Bitcoin fees tend to spike during periods of high usage because each transaction must be verified by miners. And if you have a lot of pending transactions, the cost of processing them quickly can skyrocket.
Editor’s note: This article was created with the help of AI. Edited and fact checked by Stacy Elliott.
