Glitches still plague bitcoin rollout in El Salvador

Salvadorans trying to pay for a cup of coffee or receive money sent from relatives in the United States using the cryptocurrency bitcoin continued struggling to perform transactions, a day after El Salvador made it legal tender

Via AP news wire
Wednesday 08 September 2021 22:26 BST
El Salvador Bitcoin
El Salvador Bitcoin (AP)

Salvadorans trying to pay for a cup of coffee or receive money sent from relatives in the United States using the cryptocurrency bitcoin continued struggling to perform transactions Wednesday, a day after El Salvador made it legal tender.

Problems still plagued the digital wallet Chivo.

El Salvador President Nayib Bukele kept citizens apprised of advances of gradually expanding the ability to download the application throughout the day.

“The idea is to go bit by bit to not saturate the servers with so many enrollments at the same time,” Bukele said via Twitter “We are still fine tuning small details.”

In the street, problems persisted.

Carlos Soriano, 29, visited one of the Chivo automatic tellers to receive remittance money sent by a relative in the United States. Sending that money to relatives back home allegedly without transaction fees was one of Bukele’s biggest selling points for bitcoin adoption.

“I receive remittances and they sent me this month’s, but I wasn’t able to take out the money,” Soriano said. “They tell me it isn’t working, that I should come back later or tomorrow.”

At a Chivo help center, an attendant explained that the digital wallet was still experiencing problems. “The servers collapsed, more than a million people were trying to download the application Chivo wallet,” said the man who identified himself as Kike.

There has been skepticism about the government’s enthusiastic adoption of bitcoin since Bukele announced it in a video recorded in English and played at a Bitcoin conference in Miami in June. Bitcoin is subject to wild swings in value in a matter of minutes.

An analysis by the Science, Technology and Innovation Institute at Francisco Gavidia University said that the investment the government made in buying 550 bitcoins had already lost money.

On Tuesday, bitcoin joined the U.S. dollar as legal tender in El Salvador. Any business with the technological capacity to do so is required to accept payment in bitcoin. Recent public opinion surveys in El Salvador have shown a majority of Salvadorans oppose making it an official currency.

Garth Kiser, a 43-year-old from Oregon, Illinois, visited a Chivo automatic teller Wednesday hoping to exchange dollars for bitcoin. “The machine isn’t working, I’ll come back later,” he said.

Kiser and friends came to El Salvador with the idea of “helping Salvadorans use bitcoin. I’ve been using it for a long time.”

When an AP journalist who successfully downloaded the Chivo digital wallet tried to use the $30 bonus the government offered to incentivize adoption, he was told there were more steps.

At a Starbucks, the cashier explained that before using any of the $30 bitcoin credit he would have to transfer at least $1 to a friend or someone else and “then it will be activated to buy or pay for whatever you want.”

She said Starbucks accepted not only payment through Chivo, but other digital wallets as well.

Oscar Cosme, 37, also had managed to download Chivo, but went to a help center for assistance because he hadn’t been able to use the $30 credit.

He said the attendant told him the digital wallet was undergoing maintenance and he would have to wait to use it.

Cosme downloaded the wallet because he was curious “and for the credit.” But now he was worried because “they say once you download it, the government is spying on us.”

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