 It's been over a year since Cell Salvador adopted Bitcoin as its official currency. The outcome of this unprecedented initiative is still being debated. Bitcoiners have praised it as the first milestone leading to a global Bitcoin revolution. But financial institutions and mainstream media frame it as a failed gamble by the country's president Nahib Bukele. So President Bukele, I would say, is a pragmatist. He's preparing his country for the future, future-proofing it against fiat money collapse. So what are the actual results of El Salvador's Bitcoin project? And can it serve as an example for more countries to follow? We talked about it with Samsung Mao, the CEO of Gen3 and one of the main proponents of Bitcoin adoption in El Salvador. I'm Giovanni, your host. In this show, we challenge the ideas that are shaping the world of crypto. In each episode, we assess a crypto narrative, a macroeconomic outlook or a potential disruptive technology. Probably the most solid ideas will make it to the other side. I know that you have been one of the main proponents of Bitcoin adoption in El Salvador. You have been there multiple times. You have been collaborating with Bukele's government. So can you tell us what are the main achievements in terms of Bitcoin adoption in El Salvador that were achieved during this time since the Bitcoin law was adopted? So I would say the biggest achievement is that they've managed to rebrand themselves as Bitcoin country. And they've drawn a lot more attention to themselves on the international stage. This is good on a number of reasons because they're attracting more investments in the country. They're attracting a lot more tourism. I believe tourism is up 30 percent. And basically they are the epicenter of nation-state Bitcoin adoption at this time. So they're doing quite well. The media reports that El Salvador is at risk of default, but I would say they're far from that. They're growing their GDP in double digits right now. And if you look at their GDP growth and assume a marginal tax rate of 20 percent, they're probably up about half a billion in revenues this year. So that dwarfs any drop in the value of their Bitcoin holdings by far. So I would say they're doing quite well after adopting Bitcoin. Yeah, definitely. I think that a lot of people started knowing about El Salvador specifically because of Bitcoin, because of the personality of Bukele, he's a great marketer in that sense. So apparently there are certain problems with Bitcoin payment infrastructure. El Chivo, which was this Bitcoin wallet, government-backed Bitcoin wallet, was full of bugs. Our reporter, Joe Hall, was there not long ago? He also said that, quote, Bitcoin payments in El Salvador suck. So how can you comment on that aspect? Well it depends on what you're looking at. When Chivo was first rolled out, there were a number of issues, and I believe the deployment was rushed. They were trying to hit a deadline to match the deployment of the law. But since then, they've brought on a number of companies to help with it. And I believe that the payments are much smoother now. There are still some issues with lightning, I believe, and that could be due to just general lightning channel liquidity. You're basically recreating traditional banking infrastructure in the country. So it's bound to take some time, and it's bound to have uneven deployment. But the important thing is to look at what Bitcoin enables in El Salvador right now. And it's basically giving everyone in the country access to something like PayPal or Venmo or Wwise. So they can make these digital payments, pay bills, pay other people without having to deal with an intermediary, and without having to go through a lot of overhead, such as getting a bank account and maintaining a bank account. The population of El Salvador was largely and still is unbanked. But according to a recent survey, up to around 24% of the population of El Salvador uses Bitcoin. So it seems to be not so much. But if you consider the fact that probably before Bitcoin, all those people didn't have any access to financial services, that is still a huge, huge improvement. Still a comparative little amount of people use Bitcoin in El Salvador as a form of payment, far less than the people that still want to use the dollar, for example, which is the second legal tender in El Salvador. So is that because, according to you, of the lack of sophisticated infrastructure, so infrastructure need to be improved, or is it because of a lack of education? Well, all the aspects should be improved. But I would say the lack of uptake on Bitcoin is largely because they need to still receive dollar denominated value. So if you're a merchant and you're selling capuzas or selling drinks or things on the street, you're paying your supplier in dollars probably, right? So unless they're taking Bitcoin, you still need to collect payment in dollar denominated value. So this is why Chivo is useful, because it allows them zero fee conversion. So if a tourist goes to them and pays them in Bitcoin, they can get converted into dollars on the spot. So they're not at risk dealing with Bitcoin volatility. Overall, I would say if we want Bitcoin to be adopted as a form of medium of exchange, just like accepting it and pricing it in Bitcoin, we need Bitcoin to go up a lot more to the millions of dollars per coin mark, where the volatility would be a lot less pronounced. But that's going to take a long time. I think that education on how to use Bitcoin could probably have a faster effect on adoption in the country, no? Yeah, I'm not sure it will take that long. Currency collapses happen very rapidly and they're usually not anticipated. If you look at history, it just sort of happens overnight and then you're shoveling cash into a wheelbarrow. So Bitcoin could be at the million dollar mark in five, 10 years. And I think the benefit of El Salvador adopting a Bitcoin standard is that they've already onboarded their population and started to educate them in how to use Bitcoin. So as you said, El Salvador was famous for the gangs, for violence and so on. Since Bukele adopted a strong hand towards these problems, the crime rates have fallen a lot. Still, a lot of critics say that he has been using authoritarian methods to achieve these goals, like, for example, extrajudicial arrests. He's also defied the constitution in order to extend his presidential mandate. What is your personal opinion about Mr. Bukele and about these criticism that has been brought against him? So President Bukele, I would say, is a pragmatist. He does what's needed and he takes steps that will pay dividends off in the future. So the Bitcoin law is one of those things. He's preparing his country for the future, future-proofing it against fiat money collapse. The other things that he's doing to make the country safer, such as basically going to war against the terrorists that have been killing people. I mean, you can look at that from a nice and safe Western country and say, you know, that's not ideal, but you have to deal with the reality on the ground, which is you have sophisticated networks of gangs that are killing people. So you should go after them. It's what pragmatism would dictate you need to do to keep the country safe. Without safety, it's difficult to grow a country in terms of GDP, attracting investment and tourism. So a new bill has been introduced recently to the Parliament of El Salvador, which is the first step in order to create this Bitcoin bond, which is basically an initiative that will allow El Salvador to sell one billion worth of bonds, 10-year bonds, to investors. Half of it will be invested in Bitcoin and the other half is going to be invested in Bitcoin infrastructure and this Bitcoin city that is going to be built in El Salvador. You are one of the big proponent of this. You are also called the architect of the Bitcoin bonds. Can you tell us how is the current state of this initiative at the moment? Right. So as you mentioned, they've put forth the law to Congress and this is the first step to enabling it. So first, they'll need to approve the law. Then they'll need to, I believe, form a regulatory body that would govern these digital securities. And then they'll need to put forth a prospectus. Which would detail what the Bitcoin bonds would actually look like. So the design that we had, which was from last November, may be outdated, so they probably need to revisit that and see. But that was designed in a very different market when Bitcoin was about 47,000 and mining was profitable. Right now, hash rate difficulties at an all time high and Bitcoin prices down. So I think we need to look at the economics of the design of the bond. So we still don't know when they're going to be available, more or less? It's possible end of Q1, early Q2. It just depends on how fast everything goes and when they have the prospectus. And I guess that the cool thing about this bond is that everyone can become a bondholder, right? Just also individual retail investors can participate in this. Yeah, everyone that is able to register and access the Bitcoin securities platform will be able to access it. And the goal is that smaller retail investors, like someone in El Salvador, can actually invest in their own country because historically, bonds are not that readily accessible, but with the Bitcoin bonds, because it's being built on liquid, we can go down to about a hundred dollar coupon size. So if you have a hundred dollars, you can actually buy a piece of the bond and then take that bond and store it in your block stream green or your Gen 3 aqua wallet. So we saw that a number of countries are moving towards the example of El Salvador and trying to adopt Bitcoin as a legal tender. We saw that this year, the Central African Republic adopted Bitcoin as a legal tender. So you are involved as the CEO of Gen 3 in the basically promoting these sort of changes. I wanted to ask you what kind of lesson should these countries draw from El Salvador? Well, I would say the most important thing is that there is a grassroots movement in the country that anchors the Bitcoin adoption. The Central African Republic doesn't really have that. So they they did pass a law, but then they created their own altcoin, the Sango coin, and it seems like they're they're trying to do some metaverse and NFT things, and I don't believe that's very practical or useful. And I would say a large part of that has to do with the lack of this grassroots movement. So in El Salvador, you have Bitcoin Beach and in a number of Latin American countries, you have their own little initiatives, right? In Guatemala, you have Bitcoin Lake and there's many more examples around the world of these things, but I think without that strong community to kind of keep the government in check and accountable, they can go off on a tangent and take on some of these odd projects. So I would say a mix of top down initiative and bottom up initiative is needed to balance each other out in any country that wants to successfully adopt Bitcoin. For sure, the presence of a grassroots community is very important because Bitcoin as in its ethos, I think, has this grassroots element in it. So it's very important that it's just not like a top down initiative. Thanks a lot, Samson, for being on our show. It was a pleasure to talk to you today. Thanks Giovanni. Take care.