Honduras launches Bitcoin Valley. The tiny Central American country is launching a Bitcoin Valley to grow the region and boost cryptocurrency adoption. Businesses in the city of Santa Lucia, Honduras are now accepting payments in BTC. The country, neighboring El Salvador, aims to become a crypto hub in the region.
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Honduras Aims to Become a Global Crypto Hub
Honduras, a Central American country and neighbor of El Salvador, launched “Bitcoin Valley”, a project in the city of Santa Lucia, in the country, to attract cryptocurrency investors from all over the world. According to a Reuters report, a wide range of businesses in the city now accept bitcoin payments.
With the “Bitcoin Valley”, Honduras wants to enter the booming world of crypto-assets. The latest announcement from the Central American nation comes nearly 10 months after its neighboring country, El Salvador, officially adopted BTC as legal tender. El Salvador also holds millions of dollars worth of BTC.
Not to be outdone by its neighbor El Salvador, Honduras has launched a 'Bitcoin Valley' in a town 20 minutes from its capital Tegucigalpa. The Central American nation wants to promote the use of bitcoin, committing 60 companies to train and adopt cryptocurrency for their products and services.
César Andino, the owner of several small tourist businesses in Santa Lucia, told local newspaper La Prensa that he is betting heavily on the use of cryptocurrency:
"In Santa Lucia, we are all going to participate in this project. We put everything there. Accepting Bitcoin will allow us to open another market, to gain more customers. We need to globalize. We cannot close ourselves to technology and we cannot be left behind when other countries are already doing so."
Although this is primarily a publicity stunt, for the time being, it has become clear lately that developing countries, such as El Salvador and Honduras, see significant potential for the use of assets crypto, especially when local currencies are inherently unstable, commented Simon Peters, market analyst at eToro.
In the footsteps of the Salvadoran neighbor
As a reminder, El Salvador became the first country to adopt Bitcoin as a legal tender in September 2021. President Nayib Bukele sees the asset as a way to develop and strengthen the financial inclusion of its population. Thus the country relies heavily on the king of crypto-currencies.
El Salvador saw a roughly 30% jump in tourism after the adoption of BTC as legal tender in the country. However, the nation is facing some challenges after the latest drop in BTC prices.
At present, the country would have approximately 2301 BTC which he would have paid 105.6 million dollars. At the current price, this would only represent $ 52 million, a decrease of around 50% of its reserves in BTC.
This adoption of Bitcoin is also frowned upon by international bodies and in particular, the IMF, which believes that the country has gone too far. If the International Monetary Fund recognizes that crypto can lead to better financial inclusion, it believes that the country should not have made Bitcoin legal tender.
The institution declares:
"The use of bitcoin poses significant risks to financial stability, financial integrity, and consumer protection.” The IMF, in its press release, urged “the authorities [of El Salvador] to reduce the scope of the bitcoin law by removing the legal status of bitcoin."
Despite his objections, El Salvador's plan remains unchanged, and President Nayib Bukele's tweets detailing the country's new Bitcoin purchases continue to flourish on social media.
El Salvador, therefore, continues to believe in the future of Bitcoin and is implementing many projects such as Bitcoin mining using the energy of volcanoes. The next few years will tell if this strategy turns out to be a winner for the small Central American country and its neighbor Honduras.
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