El Salvador’s adoption of Bitcoin (BTC) as legal tender has been widely celebrated across the crypto ecosystem, but one expert believes the importance of the rollout was a little bit exaggerated.
Speaking to CNBC, Fidelity Investments director Jurrien Timmer said that the significance of El Salvador’s Bitcoin move is “a little bit overplayed.”
“Because it’s not like El Salvador has dropped the U.S. dollar as its peg,” Timmer explained. “It’s not like it switched from dollars as its currency peg to Bitcoin.”
Reminding that the country still has the United States dollar and people can decide to be paid in dollars or pay in dollars, he added that the adoption is on a voluntary basis. However, while paying in Bitcoin is voluntary in El Salvador, local merchants in the country are mandated to accept and process BTC transactions.
Timmer noted that Bitcoin is being tested, for the first time, as a medium of exchange as opposed to a store of value. Listing its scarcity and its powerful network as the core values of Bitcoin, he stressed that the proof-of-work makes Bitcoin, by definition, less scalable than other cryptocurrencies like Ether (ETH).
The Fidelity executive compared Bitcoin’s current moment to an “adolescent’s coming of age” like gold was in the 1960s:
“Although it’s in reverse, because gold went from being money to being an asset class in the '70s. Bitcoin is kind of going from being an asset class to also being a currency or being money.”
As Cointelegraph reported, El Salvador made history on Tuesday, Sept. 7, by making Bitcoin legal tender. The government also provided a state-issued wallet named Chivo.