El Salvador is making a further push in its quest to ‘bitcoinize’ its economy. The authorities have announced that it is making efforts in SMEs with loans in BTC. The objective of this loan initiative is to enable these businesses to expand their operations.
The Next ‘Bitcoinization’ Drive
One of the top advisors to the government recently remarked that the next objective for El Salvador is to offer SMEs low-interest loans through BTC. Taher made this revelation while speaking during a live virtual meet with the topic “bitcoin loans and low-interest rates.”
While the basis for this decision was thoroughly explained, no one explained the terms or modalities of this initiative. President of the nation’s coalition of SMEs lauded the government’s initiative, stating that most SMEs in El Salvador have been unable to scale because they have to high interest rates when they obtain loans from financial institutions.
Steiner added, “nearly 67% of the businesses in this nation are SMEs, and more than 93% of them are funded through loan sharks, informal loans, or family and friends.” He stated that it is not uncommon for these lenders to charge $15 as interest payment for a $100 loan, and the borrowers must pay back in less than three weeks.
Hence, he affirmed that these low-interest BTC loans would be of immense help to these SMEs in expanding their business operations. Part of the announcement states that the nation’s Chiva wallet will be used to process these loans.
More Nations Will Soon Adopt BTC As A Legal Tender – Bukele
Nayib Bukele recently stated that it is likely that at least another two countries will enable legal BTC adoption before this year is over. He further said that he has a scheduled meeting with Turkey’s president, Recep Tayyip Erdogan, on assisting the country in replicating El Salvador’s BTC feat.
Bukele stated that the move would also help Turkey in getting out of its current inflation problems. The Turkey president recently remarked that there is a bill with the nation’s legislature proposing a modification of its current cryptocurrency policy to make way for BTC adoption as a legal tender.
If its BTC-supported loans for SMEs are successful, El Salvador also plans to expand using BTC as collateral for mortgage financing. Taher also made this revelation while speaking during the recent BTC virtual meet.
BTC Price Action
BTC and most altcoins have made some appreciable gains over the past 24 hours as the market turned bullish during this period. Despite a dip in trading volume, BTC’s market cap was nearly $820B leading to a 40.2% market dominance.
BTC 4-hour chart. Source: TradingView
The 4-hour timeframe shows the rapid uptrend in BTC price as the leading cryptocurrency seeks to establish a new lower high. BTC dipped towards the $42K level despite setting a higher high of $44.5K last week. As of this writing, BTC currently trades at $42.92K.