The Vice President of El Salvador, Felix Ulloa, recently shared his insights on the crucial role that bitcoin's adoption as legal tender has played in the country's economic revival. He believes that this strategic move has not only attracted cryptocurrency-related investments to the nation but has also lured a significant number of tourists.
Bitcoin – A Catalyst for Economic Growth
The connection between El Salvador's economic progress and the adoption of bitcoin as legal tender is a topic that Felix Ulloa, the country's Vice President, willingly discusses. In 2021, El Salvador's President Nayib Bukele led an initiative that made the nation the first in the world to accept bitcoin as legal tender.
Despite receiving criticism from several multinational organizations, including the International Monetary Fund (IMF), Ulloa maintains that the decision has had a profoundly positive impact on the nation.
Bitcoin's Impact on El Salvador's Digital Economy
In an interview with Forbes, Ulloa mentioned, "The digital economy experienced a surge of enthusiasm when El Salvador became the first country to adopt a cryptocurrency as legal tender, putting us at the forefront and attracting numerous investors who are now established in El Salvador."
Tourism Industry's Recovery and Bitcoin
According to Ulloa, the tourism industry is another sector that has seen a considerable resurgence post the Covid-19 pandemic. He links this revival to the country's new security policies and the adoption of bitcoin.
With bitcoin as legal tender, tourists entering the country can conveniently pay for goods and services, eliminating the need for currency exchange. This ease of transaction has been emphasized by Ulloa.
President Bukele's Views on Bitcoin and Tourism
Previously, President Bukele had also associated bitcoin with the recovery of the tourism industry. In August 2022, he stated that a few countries have managed to restore their tourism industry to pre-pandemic levels, attributing this success largely to bitcoin and surfing.
Ulloa's Extended Insights on Bitcoin's Influence
Expanding on this association, Ulloa asserted that the harmony between tourism and the use of digital currencies is evident and a testament to the country's rebirth and economic recovery under Bukele's administration. He stated, "Undoubtedly, tourism and the utilization of digital currencies go hand in hand and symbolize the future and our country's resurgence."
What's your take on Felix Ulloa's perspective on how the adoption of bitcoin as legal tender has influenced El Salvador's economic revival? We'd love to hear your thoughts.
Frequently Asked Questions
Can I keep physical gold in an IRA?
Gold is money. Not just paper currency. People have been using gold for thousands of years to store their wealth and protect it from economic instability and inflation. Investors use gold today as part of their diversified portfolio, because it tends to perform better in times of financial turmoil.
Many Americans today prefer to invest in precious metals, such as silver and gold, over stocks and bonds. It's not guaranteed that you'll make any money investing gold, but there are several reasons it might be worthwhile to add gold to retirement funds.
One reason is that gold historically performs better than other assets during financial panics. The S&P 500 declined 21 percent during the same period. Gold prices increased nearly 100 per cent between August 2011 – early 2013. Gold was one of the few assets that performed better than stocks during turbulent market conditions.
Gold is one of the few assets that has virtually no counterparty risks. If your stock portfolio goes down, you still own your shares. However, if you have gold, your value will rise even if the company that you invested in defaults on its loans.
Finally, gold offers liquidity. This means that you can sell gold anytime, regardless of whether or not another buyer is available. Because gold is so liquid compared to other investments, buying it in small amounts makes sense. This allows you to profit from short-term fluctuations on the gold market.
What are the benefits of having a gold IRA?
The best way to invest money for retirement is by putting it into an Individual Retirement Account (IRA). It is tax-deferred until it's withdrawn. You can decide how much money you withdraw each year. There are many types to choose from when it comes to IRAs. Some are better suited to college savings. Some are better suited for investors who want higher returns. Roth IRAs permit individuals to contribute after the age 59 1/2. Any earnings earned at retirement are subject to tax. But once they start withdrawing funds, those earnings aren't taxed again. This account is a good option if you plan to retire early.
The gold IRA allows you to invest in different asset classes, which is similar to other IRAs. Unlike a regular IRA, you don't have to worry about paying taxes on your gains while you wait to access them. People who want to invest their money rather than spend it make gold IRA accounts a great option.
You can also enjoy automatic withdrawals, which is another benefit of owning your gold through an IRA. You won't have the hassle of making deposits each month. You could also set up direct debits to never miss a payment.
Finally, gold is one the most secure investment options available. Because it's not tied to any particular country, its value tends to remain steady. Even in times of economic turmoil gold prices tend to remain stable. As a result, it's often considered a good choice when protecting your savings from inflation.
What does gold do as an investment?
The supply and demand for gold affect the price of gold. Interest rates can also affect the gold price.
Due to their limited supply, gold prices fluctuate. Physical gold is not always in stock.
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (aarp.org)
- (Basically, if your GDP grows by 2%, you need miners to dig 2% more gold out of the ground every year to keep prices steady.) (smartasset.com)
- If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (forbes.com)
- Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (aarp.org)
- Saddam Hussein's Invasion Helped Uncage a Bear In 1990 – WSJ
- You want to keep gold in your IRA at home? It's Not Exactly Lawful – WSJ
- 7 U.S. Code SS7 – Designation board of trade as contract marketplaces
- 26 U.S. Code SS 408 – Individual retirement funds
Tips for Investing In Gold
Investing in Gold is a popular investment strategy. This is due to the many benefits of investing in gold. There are many options for investing in gold. Some people prefer to buy gold coins in physical form, while others prefer to invest in gold ETFs.
Before buying any type gold, it is important to think about these things.
- First, find out if your country allows gold ownership. If you have permission to possess gold in your country, you can then proceed. Otherwise, you can look into buying gold from abroad.
- Secondly, you should know what kind of gold coin you want. You have options: you can choose from yellow gold, white or rose gold.
- The third factor to consider is the price for gold. It is better to start small, and then work your way up. When purchasing gold, diversify your portfolio. You should invest in different assets such as stocks, bonds, real estate, mutual funds, and commodities.
- Lastly, you should never forget that gold prices change frequently. Therefore, you have to be aware of current trends.
By: Sergio Goschenko
Title: El Salvador's Economic Renaissance: The Influence of Bitcoin
Sourced From: news.bitcoin.com/salvadoran-vice-president-felix-ulloa-bitcoin-adoption-fueled-el-salvadors-rebirth/
Published Date: Tue, 17 Oct 2023 21:00:29 +0000