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El Salvador Gov’t to Mitigate Against Fuel Price Crisis – Using its Bitcoin App

Adoption

Bitcoin El Salvador Latin America

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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Last updated:

June 25, 2023

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The government of El Salvador has launched a drive to help promote its Chivo bitcoin (BTC) wallet – allowing citizens and businesses who use the app to buy fuel at a discounted rate as global prices rise.

President Nayib Bukele announced that the Chivo operators had negotiated a deal with two fuel distribution companies, meaning that Chivo users could receive a discount worth USD 0.20 per gallon at petrol stations across the nation.

Bukele wrote that the “state-owned company Chivo” had “negotiated with the largest gas station companies in the country,” and that the move would “mitigate several increases in the international price of fuel.”

The president went on to note that the discount would “have no limit” and would apply not only to individuals, but also to public transport operators, “entrepreneurs and all companies.” The discount will be valid from September 30 to October 14, he explained.

The government mouthpiece Diario El Salvador reported that “taxi drivers, Uber and InDriver drivers, public transport, school transport operators, private motorcyclists, couriers, private vehicles, delivery people, travelers and merchandise distributors” all stood to benefit.

The President added that the move would also “reduce transportation costs in supply chains.”

Fuel prices are on the march all over the world and shortages have been reported around the world in recent days, disrupting nations as far afield as the UK and Brazil. Per Bloomberg data, Brent crude prices are peaking at levels not seen since late 2018, while natural gas prices are also up.

ElSalvador.com reported that the international picture “will drive up the price of gasoline and diesel” in the nation, and noted that this year alone “there have been at least 15 increases in fuel prices and only three decreases.”

But mainstream media outlets continue to report that many in the nation are still struggling to come to terms with bitcoin adoption after the token became legal tender, alongside the USD, on September 7.

Reuters quoted Jean-Paul Lam, an associate professor at the Canadian University of Waterloo, as stating:

“Bitcoin is not an easy technology to adopt […] especially for old people looking to receive remittances. It will face a lot of obstacles in getting people to adopt it.”

However, Lam conceded that other nations are likely casting an eye at events in the Central American nation, calling Bukele’s BTC plans a “little lab experiment that other countries are watching.”

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Learn more:
– El Salvador’s Bitcoin Mining ‘Volcanode’ Takes its ‘First Steps’
– Angry Bukele: No Salaries or Pensions Will Be Paid in BTC, Critics are Lying

– What Are Salvadorans Doing with their USD 30 Bitcoin Giveaways?
– ‘Dictator’ Bukele ‘Buys the Bitcoin Dip’ as 1.1M Users Flock to Chivo Wallet

– Thousands Joined Anti-Bitcoin March in El Salvador, BTC ATM Torched
– El Salvador Bitcoin App Is a Private Firm Funded by Public Funds, Say Media