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El Salvador is making waves.
This is the first country in the world to declare Bitcoin as Legal Tender.
It may also be home to the first town with a fully supported bitcoin economy.
It all started with an Anonymous Donor
What began as an anonymous donation in 2019 has turned into a town-wide initiative to create a fully supported bitcoin ecosystem.
Once a small fishing village, this popular surfing town of 3,000 people located just an hour’s drive from the Capital of El Salvador is now affectionately known as Bitcoin beach.
The El Zonte Experiment (aka Bitcoin Beach)
As the story is told, an anonymous American donor had rediscovered a memory stick that was loaded with Bitcoin. He had filled the memory stick with Bitcoin when it was traded around 5–10 cents. After remembering his passphrase and unlocking the funds, he was determined to put the newly found wealth to good use by donating multi-year six-figure donations to a popular surfing town he was fond of — El Zonte.
The anonymous donor, after meeting up with many different non-profits, decided to partner with Michael Peterson, who was a volunteer in El Zonte.
This anonymous donor made Michael the administrator of the Bitcoin under the condition he would not cash out the crypto into fiat, rather use the bitcoin to create a Bitcoin economy within the town.
Since then, this project has helped to fund training and education projects to empower the townspeople. To date, the project has helped over 500 families, used by 15 businesses and more than 600 individuals.
According to the project, over 90% of families in the town have been able to make a bitcoin transaction.
The project has changed the lives of many El Zonte residents, giving them the ability to save, invest, and exchange currency — all made possible without the use of any traditional bank.
El Salvador — A Country Without a Currency
El Salvador is a country without its own currency. In 2001, the Government of El Salvador phased out its domestic currency in favor of the US dollar.
Today both the US dollar and Bitcoin are considered legal tender in El Salvador.
What is Next for El Salvador?
The world is carefully watching El Salvador and the town of El Zonte. El Zonte offers a model for the potential large-scale adoption of Bitcoin across the nation, especially now that Bitcoin has been decreed legal tender.
Got Bitcoin? Like to Surf?
El Salvador is the only country in the world that has decreed Bitcoin as legal tender. In many ways, this also makes El Salvador a Bitcoin tax haven.
For those looking to escape the capital gains taxes triggered with Bitcoin transactions and spend bitcoin as freely as fiat currency, then we may also see El Salvador labeled as the world's first Bitcoin Tax-Haven.
What is Next…the World?
The Bitcoin Beach initiative began long before Bitcoin was made legal tender by the El Salvadorian government and to date, this project has positively impacted many families and businesses in the town — It has been a success.
It is hoped that this model can also be applied to towns and countries that have also been impacted by a local currency collapse. Venezuela, Zimbabwe, Sudan, Lebanon and many other countries that are currently experiencing hyperinflation could all benefit from a similar initiative.
~ ¡Viva la Crypto!