The tiny Central American nation is establishing a Bitcoin Valley to develop the area and increase the uptake of cryptocurrencies. Businesses in Santa Lucia, Honduras are already taking Bitcoin as payment. The nation, which borders El Salvador, wants to develop into a regional center for cryptocurrency.
Aiming to Become a Global Crypto Hub is Honduras
A project called “Bitcoin Valley” was started in the Central American nation of Honduras, which is El Salvador’s neighbor, in order to draw cryptocurrency investors from all over the world to the city of Santa Lucia. Numerous shops in the city now accept bitcoin payments, according to a Reuters report.
Honduras aspires to access the burgeoning market for crypto-assets through the “Bitcoin Valley.” The Central American country’s most recent declaration comes over ten months after its neighbor, El Salvador, formally recognized bitcoin as legal cash. El Salvador also has Bitcoins worth millions of dollars.
In an effort to catch up to its neighbor El Salvador, Honduras has opened a “Bitcoin Valley” 20 minutes from Tegucigalpa, the country’s capital. The country of Central America aims to promote the usage of bitcoin and has pledged to teach 60 businesses to use Bitcoin in their goods and services.
Lanzamiento Bitcoin Valley@Blockchain504 @coincaex @UTHEDU pic.twitter.com/36cTLeB2ao
— Blockchain Honduras (@Blockchain504) July 28, 2022
The owner of numerous small tourism companies in Santa Lucia, César Andino, told the local daily La Prensa that he is placing a significant amount of faith in the use of cryptocurrencies:
- In Santa Lucia, we will all participate in this project. We put everything there. Accepting Bitcoin will allow us to open another market, to gain more customers. We need to globalize. We cannot close ourselves to technology and we cannot be left behind when other countries are already doing so.
Even while for the time being this is mostly a publicity ploy, it has recently become apparent that emerging nations like El Salvador and Honduras see a lot of potential for using cryptocurrency, especially when local currencies are already unstable. Simon Peters, an eToro market analyst, stated.
Following in the neighbor’s Salvadoran footsteps
Recall that in September 2021, El Salvador became the first nation to recognize Bitcoin as legal money. The asset, according to President Nayib Bukele, can be used to expand and fortify the country’s population’s financial inclusion. As a result, the nation depends largely on bitcoin, the king of cryptocurrencies.
Following BTC’s introduction as official currency, tourism to El Salvador increased by almost 30%. After the most recent decline in BTC price, the country is now confronted with various difficulties. The nation would currently possess 2301 BTC, for which he would have paid 105.6 million dollars. This would equal only $ 52 million at the current pricing, a reduction of roughly 50% of its Bitcoin reserves.
International organizations, like the IMF, are against this adoption of Bitcoin because they think the nation has gone too far. The country shouldn’t have made Bitcoin legal tender, according to the International Monetary Fund, even if it acknowledges that cryptocurrencies can improve financial inclusion.
The organization proclaims:
- The use of bitcoin poses significant risks to financial stability, financial integrity and consumer protection ”. The IMF, in its press release, urged “ the authorities [of El Salvador] to reduce the scope of the bitcoin law by removing the legal status of bitcoin .
El Salvador’s plan is still in place despite his concerns, and President Nayib Bukele’s tweets announcing the nation’s fresh Bitcoin purchases continue to be quite popular on social media.
El Salvador just bought the dip! 🇸🇻
— Nayib Bukele (@nayibbukele) May 9, 2022
500 coins at an average USD price of ~$30,744 🥳#Bitcoin
El Salvador, which still believes in the potential of Bitcoin, is carrying out numerous projects including using volcano energy to mine the digital currency. The coming years will reveal whether this tactic works out well for the little Central American nation and its neighbor Honduras.
