El Salvador's President to Uphold Bitcoin Strategy After Re-election

In a surprising move, El Salvador has declared its unwavering support for Bitcoin as a legitimate means of payment during Nayib Bukele's second presidential tenure. This decision comes despite pressure from the International Monetary Fund (IMF) to reconsider the country's monetary policies, which raised concerns when El Salvador announced plans to issue $1 billion worth of Bitcoin bonds and was denied the corresponding loan.

Ulloa emphasized that the emergence of spot ETFs based on digital gold in the United States only strengthens the government's resolve regarding cryptocurrencies, stating, "Not only will the [law] be retained, but at present, it enjoys the highest level of trust worldwide."

Following a likely victory in the upcoming presidential elections, as indicated by the majority of polls, Nayib Bukele and his "New Ideas" party plan to proceed with their initiatives to issue Bitcoin-backed bonds and construct a tax-free city called Bitcoin City.

Ulloa expressed hope that obstacles to accessing IMF financing would be resolved as the country reduces its national debt.

The elections in El Salvador are scheduled for February 4th, with Reuters reporting an 82% public approval rating for Bukele. His closest competitor, Manuel Flores from the opposition party, has garnered only 4% support.

Bukele's popularity primarily stems from his efforts to combat crime. During his four years in power, El Salvador has transformed from a country with one of the highest crime rates in Central America to one with the lowest number of homicides in the region. However, to implement his plans, Bukele's government had to compromise on some constitutional rights, allowing law enforcement to arrest individuals without warrants and granting the government nearly direct access to private communication channels.

At present, over 2% of El Salvador's adult population is incarcerated, leading opponents to label Bukele as a modern autocrat. Bukele himself has repeatedly proclaimed himself as the "coolest dictator in the world."

Earlier, El Salvador's Vice President, Felix Ulloa, asserted that the legalization of Bitcoin in 2021 was a vital component of the country's recovery from crisis. According to Ulloa, the anti-gang program and digital gold were crucial factors in initiating a tourism boom.

A recent survey by the Central American University of José Simeón Cañas revealed that 12% of Salvadorans had used Bitcoin at least once to pay for goods and services in 2023.

In December 2023, the government introduced the "Bitcoin Freedom Visa" program, offering residency and potential citizenship in exchange for $1 million in BTC or USDT investments.

In the same month, the local Digital Assets Commission approved the issuance of Volcano Bond Bitcoin bonds in the first quarter of 2024.