Investment management company VanEck’s strategic advisor Gabor Gurbacs has compared El Salvador to Singapore as a possible future financial center in the Americas.
Gurbacs believes that increasing capital investment and immigration will be crucial in driving economic development in El Salvador in the next years, drawing similarities to Singapore’s change in the late 1990s. These debates all started after a post by Max Keiser, a well-known American broadcaster and Bitcoin supporter who just relocated to El Salvador. Keiser’s “Move to #ElSalvador, The New Land of the Free” article mentioned a few of them, such as the fact that Bitcoin is recognized as legal cash there and the availability of the U.S. dollar.
Max Keiser listed the country’s attempts to reduce crime, its beautiful beaches, and its world-famous coffee as reasons to visit El Salvador. Since Nayib Bukele became president of El Salvador in June 2019, the country’s economy has emerged on the global stage. Sovereign bonds issued by the government have outperformed many other developing markets, with a remarkable 70% return by August. This has attracted the attention of major financial institutions such as JPMorgan and other big investment firms.
In the same week that Bitcoin was officially recognized as legal cash by the Bukele government in September 2021, a Bitcoin custodial wallet, Chivo Wallet, was made available to all Salvadorans. Volcano Energy, a Bitcoin mining venture powered by El Salvador’s volcanic resources, was started in June with a massive $1 billion investment. As executive chairman of the firm, Keiser is deeply engaged in this effort. In October, the country’s first mining pool was launched thanks to collaboration with Bitcoin miners Luxor Technology.
El Salvador hired Saifedean Ammous, author of The Bitcoin Standard, as an economic adviser to the National Bitcoin Office in May as part of a strategic effort to advance the country’s cryptocurrency ambitions. The country plans to use Bitcoin accumulation as part of a strategy to reduce its debt load over the next five years. The elimination of taxes on technical inventions was another brave move by Bukele in April. It is hoped that this would encourage more business owners and investors from outside to settle in the nation, therefore bolstering the economy.
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