182 Interactions, 6 Today
Bitso, a Mexican cryptocurrency exchange, has been recognised as a core partner for El Salvador’s state-issued BTC wallet.
Bitso, a large Latin American cryptocurrency exchange, will be the primary crypto service provider for El Salvador’s official Bitcoin (BTC) wallet, known as Chivo.
In conjunction with Bitcoin becoming legal cash in El Salvador, Bitso announced on September 7 that it would collaborate with Silvergate Bank, digital currency business Athena Bitcoin, and blockchain firm Algorand to build the state-supported BTC wallet.
Silvergate Bank, a California state-chartered commercial bank and a United States Federal Reserve member, will work with Bitso to facilitate U.S. dollar transactions for the Chivo wallet. Athena Bitcoin will provide some front-end services and Chivo’s ATM-related operations, while Algorand will act as the official blockchain provider.
Launched Tuesday, the state-issued Chivo wallet is designed to enable individuals and businesses to send payments in Bitcoin or dollars from anywhere in the world. The wallet is available on Android and iOS, allowing users to automatically convert Bitcoin transactions into dollars or keep their Bitcoin holdings and later withdraw them in cash from 200 Bitcoin ATMs installed across the country.
A spokesperson for Bitso told Cointelegraph that Chivo users will not have to pay fees related to the network, noting that “none of the withdrawals, deposits or other transactions” made with the Chivo app would generate fees for users, elaborating:
“The Salvadoran government has created strategic partnerships to ensure that convertibility is undergone at the most competitive prices possible, and users will not have to be faced with covering any costs.”
“The use of the Chivo wallet is completely optional, and those without citizenship will be able to access the app as well,” Bitso noted in the announcement.
Santiago Alvarado, vice president of Bitso for business, expressed confidence that El Salvador’s Bitcoin acceptance will have a “positive impact on the lives of millions of Salvadorans.”
“Over the last seven years, we have worked tirelessly to identify the best approach to make Bitcoin accessible to more than 2.75 million customers across Mexico, Argentina and Brazil. Today, as the leading crypto-service provider for El Salvador’s wallet, we are committed to making crypto useful for Salvadorans,” Alvarado added.
Following the Chivo wallet launch, Salvadoran President Nayib Bukele reported that temporary capacity errors on the platform were causing app installation issues. Bukele said that Chivo will temporarily disconnect its systems to fix the issue. The president also noted that Chivo would be available for Salvadorans in the U.S. and “almost every country in the world.”
Bitso, founded in 2014, is a prominent cryptocurrency platform in Latin America, backed by large crypto businesses such as Coinbase and Ripple in the United States. The exchange’s user base nearly tripled from one million in July 2020 to over three million by September 2021. Following a $250 million capital raising earlier this year, the business appointed Facebook veteran Vaughan Smith as chief operations officer in late August.
In early June, President Bukele introduced legislation to recognise Bitcoin as legal tender alongside the US dollar, with the goal of banking the unbanked population using the digital currency, as 70% of Salvadorans lack access to basic financial services. The measure was later approved by the nation’s Legislative Assembly and was set to go into effect on September 7.
Many citizens in El Salvador have protested the government’s plans to make Bitcoin legal cash, citing volatility and security concerns. According to a survey conducted by El Salvador’s Central American University’s Institute of Public Opinion, 70% of Salvadorans feel that Bukele’s Bitcoin bill – should be repealed. Over 90% of survey respondents also said they have a poor understanding of cryptocurrency.