Just a few hundred miles from El Salvador, Guatemala’s Bitcoin Lake contrasts state-led Bitcoin adoption with a promising grassroots model.
This is an opinion editorial by Rikki, author and co-host of the “Bitcoin Italia,” and “Stupefatti” podcasts. He is one half of the Bitcoin Explorers, along with Laura, who chronicle Bitcoin adoption around the world, one country at a time.
Laura and I continue our adventures in Central America with the aim of gaining an in-depth understanding of the peculiar characteristics of Bitcoin adoption in the very different countries there and reporting it without bias on our YouTube channel, “Bitcoin Explorers.”
The great curiosity that grips us after spending more than a month in El Salvador, and leaving it behind, is to try to understand what people think about Bitcoin in countries where there has been no government propaganda, no media coverage and no lousy state app like the Chivo wallet to complicate things. Countries where, therefore, adoption is not happening by decree, but solely through the free initiatives of citizens and through the work of private companies that believe in Bitcoin and build products and services on top of its protocol.
But the question we would like to try to answer is not the simplest one: Is bottom-up Bitcoin adoption better than the top-down adoption theorized by El Salvador President Nayib Bukele?
Exploring Grassroots Bitcoin Adoption In Guatemala
To find the answer, our latest destination was Guatemala, a country that is, in some ways, very similar to El Salvador. As of 2017, there were 16.5 million inhabitants there, nearly 60% of whom lived below the poverty line, likely unbanked or underbanked, and 23% lived in extreme poverty. At that point, 0.001% of Guatamalans held more than half of the country's wealth. These are ideal conditions for Bitcoin's intrinsic features to be appreciated.
Unlike El Salvador, however, Guatemalan government policy is not favorable to cryptocurrencies, in fact, it is quite the contrary. Significant laws and regulations have been passed in an attempt to harness the phenomenon and control it.
Nonetheless, around Lake Atitlán, one of the country's hottest tourist destinations, a small group of pioneers has been organizing an alternative economy experiment in Bitcoin for about a year, along the lines of what has already been done in El Zonte by Bitcoin Beach. The name chosen for this experiment is Bitcoin Lake and this was our chosen destination.
We spent about ten days on the shores of the lake and what we documented surprised us in a positive way, beyond our wildest expectations.
We found ourselves in a place of rare beauty. A large body of water surrounded by volcanoes and impenetrable jungle — tropical nature in its purest expression.
On the banks of Atitlán rise several local settlements, some larger towns, such as Panajachel, where there really is everything one could want in order to spend a few weeks of leisure and rest, and other smaller villages, for example San Marcos, totally immersed in nature and definitely more suitable for those who want to relax, meditate or hike. These are very different locations that thus manage to meet the needs of all kinds of tourists. And indeed, the lake thrives on tourism. It is striking how many hotels, bars, restaurants and activities are offered to those who choose to spend their vacations here.
There is one thing, however, that unites every activity around here: cash. Even in Guatemala, access to electronic payment instruments is very limited and credit card fees are exorbitant. Any tourist would soon realize this, because as they travel here they will see that the few businesses that accept credit cards charge 5% or 10% more on your bill if you want to pay with Visa or Mastercard. This is another ideal condition in Guatemala, then, to build an alternative economy with Bitcoin.
And this is an opportunity that some local companies are understandably seizing. In addition to the plethora of open-source bitcoin wallets available, there are applications such as Osmo, which, in addition to allowing people to receive and send bitcoin, allows them to instantly convert them into quetzales, the local currency, or even U.S. dollars. There are local payment services such as IBEX that offer merchants a state-of-the-art implementation of the Lightning Network, ideal for larger businesses that also have reporting requirements. These services, thanks to the Bitcoin protocol, really do brilliantly replace a bank account or point-of-sale (PoS) provider. This is perhaps why there is so much enthusiasm on the lake for this technological innovation, and why adoption is growing so strongly. When you consider that the Bitcoin Lake experiment began not even a year ago, it is impressive how many businesses and merchants are already accepting bitcoin: a system that is faster, safer and cheaper than credit cards.
What Is It Like To Live On Bitcoin In Bitcoin Lake?
But what is it like, then, to live on bitcoin in Bitcoin Lake?
Super fun!
There are so many options available to Bitcoin travelers. We ate lunch and dinner at grassroots restaurants, had breakfast tasting the excellent local coffee, danced late into the night drinking great cocktails, even flew paragliders over the lake, rented a boat and took a tuc-tuc: all while paying in bitcoin. There are dozens and dozens of businesses that already accept them, and one is honestly spoiled for choice.
The comparison with Bitcoin Beach is, in this respect, merciless. Atitlán is a much larger and more organized resort, so the supply in bitcoin will be greater considering such a wider reach for adoption. El Zonte, outside of the ocean and the surf, has little to offer and is a very small village, where at 8:00 at night you struggle to find an open restaurant. But Panajachel, for example, is a resort that manages to entertain well into the night. Here, you can happily come on vacation with your wife or pre-coiner friends while enjoying a wonderful Bitcoin holiday without the fear that they might get bored.
But how do merchants react when, upon entering their store, you ask if you can pay in bitcoin?
We were also very impressed by their reactions! They often gave us toothy smiles and said “yes” with a pride and enthusiasm not often encountered with most merchants in El Salvador. When it was time to pay a bill, they took their tablets or smartphones with incredible confidence, opened their wallets and, with four taps, showed us the correct QR codes — amazing awareness and knowledge of the technological tool.
Needless to say, of course, this was not always the case. There were also those who panicked, those who answered us that, right now they could not accept our transactions because the owners were not there and the bitcoin wallet was on their smartphones, those who told us that today "Bitcoin is not working" and therefore, they were sorry, but they could only accept cash.
In short, there is everything and more in Bitcoin Lake and it is still so early! But the feeling we have is that there is a lot of curiosity in the streets. When we stopped to talk about Bitcoin with locals, we always sensed a keen interest. They often asked us questions, they wanted to know more.
"Is it true that it's free? Really with the right application, even if you pay in bitcoin, I can receive quetzales or dollars?"
No testy expressions, huffing faces or politically-aligned answers like, "I don't care about bitcoin because I hate Bukele."
In Bitcoin Lake, we were only a few hundred miles further north than El Salvador, but a totally different wind seemed to be blowing. We have no doubt that this will soon be a very popular destination among Bitcoiners. After all, for what reason should anyone visiting Bitcoin Beach in El Salvador not spend a few days here as well? There are private buses that directly connect El Tunco, the town right next to El Zonte, with Lake Atitlán. It only takes a few hours of travel time, is an extremely inexpensive transportation option and you will pass through majestic landscapes, traveling along safe roads.
Our journey in Central America continues but our impression is that this part of the continent is waking up. There is a lot of economic and tourism potential here, and Bitcoin meets real needs. The Bitcoin traveler's horizons, in short, are expanding rapidly and, as we have shown, the number of options is not limited only to El Salvador.
This is a guest post by Rikki. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
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