El Salvador has made history by becoming the first country to adopt Bitcoin as legal tender. The Central American nation also announced plans to harness volcanic geothermal energy for Bitcoin mining, sparking a rally that pushed Bitcoin back above $37,000.
Bitcoin's Price Recovery
According to CoinDesk data:
- Bitcoin jumped to $37,665.45 on June 10 (7:40 AM UTC)
- Represents a 16% increase from its 24-hour low of $32,437.09
- Still 40% below its April 2021 all-time high of $64,829.14
El Salvador's Groundbreaking Decision
Key developments:
- Congress approved Bitcoin as legal currency on June 9
- President Nayib Bukele endorsed the move
- Bitcoin will share equal status with the US dollar
👉 Why Bitcoin adoption matters for emerging economies
Volcano-Powered Mining Initiative
President Bukele revealed via Twitter:
- LaGeo SA de CV (state-owned geothermal company) tasked with creating mining facilities
- New geothermal well provides 95MW of clean energy
- Planned "Bitcoin mining center" around the volcanic energy source
Energy consumption context (Cambridge data):
- Bitcoin network uses 0.53% of global energy
- Mining consumes 85%+ of Bitcoin's energy
Mixed Reactions to the Move
Supportive Views
- Cathie Wood (ARK Invest): "Bitcoin drives renewable energy adoption"
- Financial inclusion: 70% of Salvadorans lack banking access
- Remittance benefits: Transfers account for 20% of GDP
Critical Perspectives
- IMF concerns: May affect financial aid
- Currency volatility risks
- Transaction fee issues for small purchases
FAQ Section
Q: How will Bitcoin help El Salvador's economy?
A: The country relies heavily on remittances (20% of GDP). Bitcoin could significantly reduce transfer costs from abroad.
Q: What makes volcano mining sustainable?
A: Geothermal energy provides renewable, zero-emission power—addressing environmental concerns about Bitcoin's energy use.
Q: Can Salvadorans actually use Bitcoin daily?
A: While large transactions work well, small purchases may remain impractical due to network fees. The dual-currency system aims to provide flexibility.
👉 Understanding cryptocurrency's real-world applications
Long-Term Implications
This landmark decision could:
- Accelerate cryptocurrency adoption globally
- Demonstrate renewable energy solutions for mining
- Reshape international remittance markets
- Influence other developing economies' financial policies
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