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El Salvador's bitcoin experiment has cost $375 million so far and lost $60 million
The initiative appears to be a response to the capital's Soyapango district's redevelopment, which has a reputation for gang violence.
According to Bitcoin Archive, Salvadorian entrepreneurs operating in the region can apply for a $100,000 Bitcoin grant to help boost the local Soyapango economy.
💥EL SALVADOR: $100K #Bitcoin grant given to entrepreneurs in the municipality of Soyapango to boost economy of the area. 🙌
— Bitcoin Archive 🗄🚀🌔 (@BTC_Archive) June 26, 2022
Soyapango has a population of 290,000 people, making it El Salvador's third most densely populated region. Soyapango, located east of the capital, San Salvador, is a major thoroughfare to the country's east.
According to a 2018 France24 article, Soyapango is a violent neighborhood where gangs serve as the local authority and turf wars between rivals are common.
“Residents live in fear, without road maintenance, garbage collection or even a hospital. The greatest problem however is getting to neighborhoods controlled by rival gangs.”
Locals typically leave "to survive," and local businesses are threatened with paying protection money.
Gangs in El Salvador
However, the random shooting of innocent people in late March, which resulted in the deaths of 62 people, prompted a tougher stance on the issue.
The Legislative Assembly enacted emergency powers at the time, suspending certain civil liberties and broadening the scope of arrestable offenses. This was supposed to be in effect for 30 days beginning March 27.
According to Reuters, the emergency measures were extended for the third time on June 25, indicating that the situation was out of control. The extension is what the people want, according to Christian Guevara, the leader of the ruling New Ideas party.
“We are determined to support not just one more (extension) but as many as are necessary at the government’s request because that is what the people are asking for.”
According to polls, 70% of Salvadorans believe these actions are necessary to reduce gang crime.
Bitfinex will cover the costs.
There are currently no public details available about the grant, such as the application and qualification process.
According to a tweet from the country's Secretary of Communications, Soyapango entrepreneurs can receive a $100,000 Bitcoin "donation" funded by Bitfinex "to boost the area's economy."
El Salvador en la mira de #Bitcoiners internacionales. 🌎💸
— Secretaría de Comunicaciones 🇸🇻 (@ComunicacionSV) June 24, 2022
Hoy emprendedores de Soyapango reciben un donativo en #Bitcoin valorado en $100,000 por parte de @bitfinex con el fin de potenciar la economía de la zona. 🤩 pic.twitter.com/9Sxzz11H3J
Bitfinex CTO Paolo Ardoino tweeted in April that Bitfinex and Tether had established a relief fund to assist people affected by gangs in El Salvador. To get things started, both companies contributed 25 BTC.
1/ 🇸🇻 🌋
— Paolo Ardoino (@paoloardoino) April 10, 2022
Bitfinex and Tether have set up a relief fund to help the families of the people affected by the pandillas in El Salvador.
Bitfinex is the preferred service provider for El Salvador's Volcano Bonds scheme, which is intended to boost government coffers and fund infrastructure development at the proposed Bitcoin City.
The project was supposed to be completed in the first half of this year. However, due to market conditions, it has been delayed.
