Salvadoran President Nayib Bukele announced that local motorists can receive a $0.20 per-gallon price reduction when they use the government-backed Bitcoin wallet.
The president tweeted the announcement of the subsidy, describing it as “positive news to the pockets of Salvadorans”. Bukele translated.
“The state company Chivo has negotiated with the biggest gas station companies in the country so that their stations will start tomorrow selling each gallon fuel $ 0.20 less, with Chivo wallet.”
Bukele stressed that the discount is not limited and that anyone can get the rebate. He stated that the discount would erase “significant increases in international fuel prices” and “reduce transport costs in supply chain logistics.”
However, some Salvadorans appear unconvinced that the subsidy ultimately benefits the public, with Twitter user Adan 3840 responding:
“Those 20 cents will come from all of us, right? The gas station does not lose, there goes the refund after paid with the taxes of even those who walk on foot.”
Others were cynical of the government’s decision to offer the discount to only those who pay using Chivo, with another Twitter account questioning why the administration did not move to offer relief on fuel prices at an earlier date.
Alongside the news, Bukele also revealed that he has authorized a fund intended to “stabilize” the domestic price of liquified gas. The president asserted that while the international market had planned a $1.17 rise in the price of 25-pound cylinders of liquified gas, Salvadoran locals will experience “a slight reduction” in cost.
He added that the government will absorb the increase for one year only, noting any reductions in global gas prices will also be passed on to consumers during the period.
El Salvador became the first country to legally recognize Bitcoin as legal tender on Sept. 7. Later that month, Bukele claimed that one-third of Salvadorans were already using Chivo less than three weeks after its launch.
However, onlookers have expressed skepticism regarding Bukele’s reports of surging crypto adoption, with outspoken crypto critic and author David Gerard asserting that Salvadoran officials are “feeding Bukele numbers that please him” that “fall apart under the slightest examination.”
In his “Attack of the 50 Foot Blockchain” newsletter, Gerard analyzed Chivo usage metrics reported by Bukele to conclude that the government-backed wallet “would be doing more transactions a day than Visa does worldwide” if the president’s data were accurate.
