El Salvador

El Salvador’s Bitcoin Folly

Image: Project Syndicate

By Jeffrey Frankel

Many aspects of cryptocurrencies are baffling, not least the success of a joke like Dogecoin. But El Salvador’s recent adoption of Bitcoin as legal tender alongside the US dollar is perhaps the strangest and potentially most worrying example of all.

El Salvador this month [September 2021] became the first country to adopt a cryptocurrency – in this case, Bitcoin – as legal tender. I say the first, because others might follow. But they should think twice, because the idea is highly dubious – and likely to be economically dangerous for developing countries in particular.

I will admit that I don’t understand the need for cryptocurrencies at all. Like many economists, I fail to see what problem they solve. They aren’t well designed to fulfill any of the classic functions of money – a unit of account, store of value, or means of payment – because their prices are so extraordinarily volatile. This volatility is not surprising, because cryptocurrencies are backed neither by reserves nor by the reputation of a well-established institution, such as a government or even a private bank or other trusted corporation.

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Gang Violence, Gender, and the Role of Education for Peacebuilding in El Salvador

Two_Girls,_El_Salvador

By Christa Giesecke

In spite of Central America’s rich history, culture and traditions, international news from the region frequently tells of violence. Organized crime in the Central American countries of El Salvador, Honduras, and Guatemala is frequently linked to maras, organized gangs with transnational origins. With a total of 431 reported homicides in September 2017 alone, El Salvador, in particular, is considered to be among the most violent countries in the region (Instituto de Medicina Legal, 2017). For women and girls, this violence poses an additional threat in the form of gender-based and sexual violence. Femicide, the intentional killing of women and girls on the basis of their sex, is prominent in El Salvador, with 468 reported cases, the equivalent of one woman’s death every 18 hours, reported in 2017 (Instituto de Medicina Legal, 2017). These alarming statistics raise questions about the nature and roots of violence in El Salvador. 

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