El Salvador’s Bitcoin Adoption A Glimpse into the Future of Monetary Systems

Westerners View El Salvador as a Model for Revamping the Monetary System

Since my arrival in El Salvador in August, I’ve been engaging with Salvadorans to gain insights into their experiences with Bitcoin and their outlook on its adoption in the future. However, it’s the Western expats who truly recognize the immense potential for Bitcoin to revolutionize this Central American economy. To them, El Salvador is like Singapore 40 years ago, and Bitcoin is the spark that ignites its domestic economic growth.

Among the expats I spoke with, Fran Stajnar, a Kiwi Bitcoin early adopter and the brains behind the digital asset investment fund “Techemy.Capital,” stands out. Fran basked in the Salvadoran sun during the pandemic and is now working on a Salvadoran ETF to democratize local investment opportunities. His goal is to funnel Western capital into Salvadoran companies, leveraging Bitcoin’s role as the pioneer in the separation of money and state. According to Fran, this financial revolution could even trigger a transformation similar to the separation of church and state that ushered in the Renaissance.

El Salvador has become Mecca for Bitcoin enthusiasts worldwide, claims Stajnar. Many view their home countries in the West as excessively restrictive and authoritarian, particularly in light of the COVID-19 response. For them, El Salvador represents liberty and an escape from the clutches of Western politics.

Amidst the ongoing debasement of fiat currencies, El Salvador shines as a beacon of hope for other nations. Global investors are beginning to realize the counterparty risks associated with holding assets in Western countries, which may face the specter of sovereign default. Meanwhile, the BRICS nations are actively constructing an alternative system, steering the world towards de-dollarization (though they claim they’re not completely ditching the dollar… yet!). It’s a steady drip that could lead to a flood.

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In its current state, the Salvadoran stock market, the Bolsa de Valores El Salvador, hosts only 83 listed companies. Unless you have the political connections of a sovereign wealth fund, investing smaller amounts of capital is a challenging task. However, Stajnar aims to change that by creating opportunities for more people to invest in El Salvador’s burgeoning economy, increasingly backed by Bitcoin. This investment option can serve as a hedge against the fiat-dependent Western markets. He foresees a significant GDP boost by 2030 if President Bukele’s policies continue, ensuring his re-election in 2024.

According to Stajnar, Bitcoin’s arrival signals the dawn of a new era where money is digital and programmable. With time, we’ll witness a Cambrian Explosion of projects built atop Bitcoin’s underlying network—the TCP/IP of the emerging internet of value. And trust me, we’ve barely scratched the surface of its potential.

While most people are unaware, the Great Reset might happen sooner than anticipated. Since 1971, the fiat system has been plagued by inflation, causing a disparity between wages and the cost of goods and services, ultimately leading to a substantial wealth gap in the West. El Salvador stands as a unique testing ground for what a world embracing the “Bitcoin Standard” could look like—a fairer monetary system for all.

The implications of a nation adopting the “Bitcoin Standard” go far beyond El Salvador’s borders. For decades, U.S. Treasuries have served as the backbone of the global fiat monetary system. Countries have been compelled to hold reserves of treasuries to participate in the U.S.-led global order and secure their energy needs. However, if more nations start settling trade in Bitcoin rather than fiat, we’ll witness the birth of a global monetary system.

The United States currently enjoys the “exorbitant privilege” of printing the fiat currency that holds the whole system together, enabling it to solve domestic problems or finance wars by creating new money. This privilege has propelled the U.S. to become one of the most powerful countries in history, both militarily and economically, at the cost of an ever-increasing national debt burden. Bitcoin-expat conversations in El Salvador reveal a deep understanding of the historical pattern of long-term debt cycles leading to currency resets on a global scale.

Throughout history, fiat currencies have repeatedly failed, often succumbing to hyperinflation. We’ve witnessed examples like the Zimbabwean Dollar and the Weimar-era German Mark. However, the debasement of currency dates back even further, with the Roman Denarii’s gradual reduction in silver content. History rhymes, and as global sovereign debt skyrockets, the likelihood of a Western default or significant dollar devaluation becomes increasingly plausible.

Bitcoin acts as a “Plan B,” allowing individuals to opt out of the perpetually inflating fiat system. Forward-thinking Western expats in El Salvador believe they can predict the future of the global financial system and have taken proactive measures to safeguard their purchasing power and personal freedoms.

So, dear readers, are you ready to embrace the “Bitcoin Standard” and join the ranks of the fearless Bitcoin expats in El Salvador? The choice is yours to make, and the possibilities are limitless. It’s time to revolutionize the world of finance and shape a fairer monetary system for the future.

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