Surging Bitcoin, Transaction Fees Impact Users in El Salvador

12 May 2023

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Bitcoin transaction fees have recently surged to a two-year high as interest grows in El Salvador. This surge is affecting everyday Bitcoin transactions. Will Hernandez, the president of the Bitcoin Association of El Salvador (ASO Bitcoin), provides insights into the situation. Before discussing Bitcoin, an update is given on El Salvador's ambitious Bitcoin experiment.

Bitcoin is now being used daily as a legally recognised form of payment, with merchants accepting it. Infrastructure development and educational initiatives are supporting wider adoption.

Challenges remain, such as integrating Bitcoin's Lightning Network support in ATMs to lower fees. The government of El Salvador is creating a favourable environment for crypto companies, aiming to establish the country as a technology hub. See more here

As El Salvador navigates the challenges of Bitcoin adoption, the country's approach illuminates potential strategies for other digital currencies and decentralised platforms. The surge in Bitcoin transaction fees underscores the importance of scalable and cost-effective solutions in the crypto space. These lessons could prove valuable for other digital currencies like Zucoins and networks such as Splitchain, which inherently offer advantages like the absence of layer one network transaction fees and easier scalability to handle more users.

The ongoing efforts in El Salvador to educate its population about crypto and build better infrastructure can serve as a blueprint for Zucoins and the Splitchain network. Implementing similar initiatives can increase user engagement and understanding, fostering wider adoption. Furthermore, as El Salvador aims to become a crypto technology hub, collaborations and partnerships with such regions can accelerate the growth and acceptance of other cryptocurrencies.

Banks' Woes Fuel Crypto Attraction, Says MicroStrategy's Saylor

Michael Saylor, founder and executive chairman of MicroStrategy, a significant Bitcoin holder, asserts that Bitcoin and similar cryptocurrencies stand to benefit from the current banking crisis. Speaking on the David Lin Report, Saylor suggested that the turmoil in banking institutions and global currency devaluation are pushing sophisticated investors towards Bitcoin.

Saylor went on to describe the global distrust in banking systems, seen not only in countries like Argentina and Venezuela, where currency value is rapidly falling, but also in the West. This erosion of trust, Saylor stated, leads people to contemplate commodity monies, such as Bitcoin, particularly when traditional currencies are depreciating and international transactions become difficult.

Contrasting Bitcoin with other forms of commodity money, Saylor emphasised Bitcoin's superiority. Unlike physical commodities which are slow, expensive to preserve, fragile and subject to hefty transaction fees, Bitcoin, being digital, is portable, and can circumvent these issues.

The scarcity of Bitcoin, Saylor underscored, sets it apart from all other commodities. Should the price of oil, gold or any other commodity skyrocket, supply could be increased in response. However, Bitcoin's supply is finite, making it impossible to produce more. This, according to Saylor, places Bitcoin at the pinnacle of money. See more here.

Zucoins: An Energy-Efficient, Cost-Effective Digital Currency For Global Transactions

Zucoins, the digital currency operating on the Splitchain network, is making headway as a viable alternative to traditional fiat currencies, particularly in times of economic instability. Addressing criticisms levelled at Bitcoin for its energy-intensive mining, variable transaction fees and scalability issues, Zucoins offers an efficient and scalable solution.

Designed to facilitate real-time transactions, Zucoins cater to the global economy's need for speedy and dependable digital transactions. The absence of layer one transaction fees, a common burden with other cryptocurrencies, further adds to the cost-effectiveness of Zucoins on the Splitchain network.

The Splitchain network's technology not only mitigates the energy consumption concerns associated with Bitcoin mining, but also emphasises ease of use. This renders Zucoins an accessible and appealing option for both experienced and beginner users. As many parts of the world are currently experiencing a decline in trust towards traditional banking systems, the allure of a secure, efficient and user-friendly digital asset such as Zucoins is increasingly pronounced.

US Gov Department, Chamber of Commerce Criticises SEC's Regulatory Approach and Supports Coinbase

A leading US business group, the Chamber of Commerce, has expressed concerns over how digital money like Bitcoin is regulated. It accuses the Securities and Exchange Commission (SEC), the body that makes rules for such digital money, of purposely creating confusion. The criticism comes as the Chamber supports Coinbase, a large digital money platform, which claims the SEC's unclear rules and lack of response have made the business environment unstable.

Coinbase, known for working closely with rule makers and being open about its business practices, wants a response from the SEC rather than forcing new rules through court action. The Chamber argues that the SEC's actions are unfair to businesses, as they depend on enforcement actions rather than clear rules, limiting public input on how digital money should be controlled.

The Chamber of Commerce, representing over 3 million US businesses, carries significant influence. Its support for Coinbase suggests that the confusion in digital money rules is not accidental, but a deliberate strategy by the SEC. Read more here.

The US Chamber of Commerce, a powerful business group, has voiced its criticism of the current approach to regulating digital money by the SEC, an important rule-making body. This could have major impacts for digital currencies, including Zucoins, which operates on the Splitchain network. The Chamber's demand for clearer rules and less random enforcement actions aligns with the need for open and supportive rules for digital currencies.

The Chamber's support of Coinbase's call for rule changes rather than enforcement actions underscores the need for positive, clear regulations in the digital money space. This matches the principles of the Splitchain network and Zucoins, which aim to create a transparent, user-friendly environment that follows the rules. The Coinbase situation could inspire other digital money platforms to seek clearer rules, leading to a more predictable and stable environment. This could then increase acceptance and use of digital currencies like Zucoins and the Splitchain network.

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All the best,
Peter
MyZucoins

Disclaimer: Of course, this is not advice, financial or otherwise. It’s also important to consider the risks and challenges associated with any potential benefits.