El Salvador Introduces Fuel Subsidy For Citizens Who Pay In Bitcoin

El Salvador’s gas stations will allow a 20-cent fuel subsidy for citizens who pay with Bitcoin BTC/USD.

What Happened: In a series of tweets, El Salvador’s President Nayib Bukele announced the state company Chivo has negotiated with the largest gas stations in the country to allow a special discount for Chivo Bitcoin Wallet users.

Effective Oct. 1, all citizens who paid for fuel with BTC received a 20-cent subsidy for each gallon of fuel.

“This erases several increases in the international price of fuels,” said Bukele, as per a rough translation.

“This benefit has no limit and can be used by public transport, entrepreneurs and by any company or person, which represents another direct relief to the pockets of Salvadorans.”

The president said he the new subsidy to reduce transportation costs in supply chains.

According to a report from Forbes Central America, El Salvador’s economy grew by 24.5% in the second quarter of 2021. The country is now the second-fastest growing economy in the region, after Panama, with a projected GPD growth rate of 9%.

The extent to which these results have been influenced by Bitcoin’s legal tender status in the country remains to be quantified.

Last week, Bukele said the country had mined its first amount of Bitcoin harnessing geothermal energy from volcanoes.

BTC Price Action: Bitcoin is down 1.49% over 24 hours, trading at $47,256. 

Wassim Chouak on Unsplash.