El Salvador subsidizes fuel prices for customers that pay in Bitcoin (BTC)

Nayib Bukele, the President of the Republic of El Salvador, has announced that citizens can get $0.20 (£0.15) slashed off the price of each gallon of fuel they purchase.

However, there is a catch, seeing as Salvadorans must use the Chivo, the government-backed Bitcoin (BTC/USD) wallet, to be eligible for the subsidy. President Bukele disclosed this news through a tweet on September 30, describing it as a positive initiative for the pockets of Salvadorans.

According to him, the state-owned company Chivo negotiated with leading gas station companies in the country to let users enjoy the reduced fuel prices starting October 1. He added that this subsidy erases several increases in the international prices of fuel. The President also believes that this discount will reduce transportation costs in supply chains.

Bukele further noted that there isn’t a limit on the discount, adding that any Salvadoran and companies based in the country can buy as much fuel as they want.

Apart from fuel prices, Bukele also announced that he had authorized a fund to help reduce the price of liquified gas.

He pointed out that the international market signed off on a $1.17 (£0.86) increase in the prices of 25-pound cylinders. However, the fund would ensure Salvadorans get a slight reduction. However, the government only intends to foot the extra costs for one year, according to Bukele.

Bukele continues getting resistance

This discount is El Salvador’s latest move to foster BTC adoption among its citizens. While this deal will benefit Salvadorans that choose to pay using the Chivo wallet, some citizens believe it is a sham.

For instance, a Twitter user going by Adan_3840 said,

Another user ridiculed the government’s move, claiming it was out of desperation. According to him, this subsidy shows that the government manipulates fuel prices. He further called the government out, asking why it had not introduced the discount earlier through another channel.

This news comes after Bukele claimed that over 2.1 million citizens had adopted the Chivo wallet by September 25. Nonetheless, these figures ruffled the crypto critic and author David Gerard, who claimed Salvadoran officials were presenting the President with false information.

In his Attack of the 50 Foot Blockchain newsletter, Gerard pointed out that the Chivo wallet would be handling more transactions a day than Visa does globally if Bukele’s data is accurate.