If I told you that there is a local economy growing in the streets of the coastal village of one of the most beautiful beaches and best surf spots in El Salvador, where its locals are turning to Bitcoin (₿) to pay for things ranging from a haircut to their weekly groceries, would you believe me?
Well, you better! Enter Bitcoin Beach, a fascinating project started in late 2019 where the people from the village of El Zonte Beach leverage on Lightining Network to use Bitcoin in their daily lives.
When I came across its account on Twitter I immediately started following what they were up to, and was inspired by the fact that this is not a project to allow some hot-shot surfers to buy cold beer or pay their lodge with Bitcoin, but rather an initiative to validate the use case of Bitcoin as means of payment through well-thought philanthropic effort, aiming to boost economic inclusion for the unbanked.
Personally, I have been in El Zonte Beach in El Salvador quite a few times. Although the last time I was there in March last year, the project had not started yet, so I couldn't see it first hand (I would've loved to become a participant of this economy during my stay. Next time I am there, you can count on it).
Anyway, this amazing story has deeply inspired me to write a post for my INSPOtlight blog. For this, I reached out to them and had the pleasure to chat a bit (no pun intended) with Bitcoin Beach's founder Michael Peterson, who was kind enough to walk me through the initiative he started after moving to El Salvador from the US. As he explains:
Our project has set out to slowly grow a Bitcoin ecosystem in El Salvador in a way that truly improves lives. For the past 6 months, we have been using Bitcoin in the coastal village of El Zonte through a number of initiatives that all involve using BTC in real transactional ways.
The project has been divided mainly in two phases, where Phase 1 involved getting Bitcoin into the local community while simultaneously making sure there were local businesses where it could be spent.
Injecting the Sats
But how did enough Bitcoin to kick-start a local economy made it to the coast of El Salvador? Well the project scored a major win when it was backed by an anonymous Bitcoin early adopter, who wanted to see Bitcoin's stated purpose come to fruition benefiting those who need it the most:
Backed by the donation of an anonymous early Bitcoin adopter, we set out to prove that Bitcoin could have the biggest impact on the lives of those society often ignores.
Ever since, thousands of millions of Satoshis have been injected into the community in different ways, including youth work programs to help improve the local environment, like cleaning El Zonte River, which runs by the village into the Pacific.
https://twitter.com/Bitcoinbeach/status/1174328900375273478?s=20
Proof of how dynamic this local economy is becoming is that the young team in charge of cleaning the river, used their Bitcoin to buy pupusas (El Salvador's delicious national dish) without exchanging it to fiat prior:
https://twitter.com/Bitcoinbeach/status/1174330306926645249?s=20
Other ways Bitcoin has been injected to this project include:
✳️ Educational grants to students staying in school,
✳️ BTC grants for university students
✳️ Universal Cash (BTC) Transfers to the elderly and poorest families in the community
✳️ Community construction projects (contractor, workers, and supplies all paid in BTC.)
According to Michael, another key motivation inherent to the project is the possibility of knock out some stereotypes and growing assumptions about the use of Bitcoin as means of payment:
Bitcoin Beach decided to challenge the growing assumptions that Bitcoin would never be used for daily transactions like buying a cup of coffee, and the assumption that Bitcoin would be used more by the wealthy than those looking to get to the first rung of the economic ladder.
By empowering the population of a coastal village in El Salvador, Bitcoin Beach has set out to create a sustainable Bitcoin economic ecosystem, where the majority are unbanked and the local businesses don't meet the requirements that would enable them to accept credit cards.
Parallel to injecting Bitcoin to the local economy of El Zonte, Bitcoin Beach, as per Michael, the project also involves educating its population on how to handle Bitcoin, while promoting its adoption by the small businesses in the village:
As we injected the BTC into the community we also taught local businesses how to accept Bitcoin and helped educate them on the advantages (and drawbacks) of accepting Bitcoin. We currently have several stores, 2 restaurants, 2 hardware stores, a hair and nail salon, and even 2 local water directives accepting Bitcoin.
After around 6 months in place, with approximately 5 BTC in circulation, the project has now 150+ users who have set up their Bitcoin wallets and are using Lightning Network “for everything from buying a $1 bag of tortillas to paying for a $3 haircut.”
I could go on and continue to write about all the exciting things about this project I have found out, but let's have a look at some of these first hand directly from their Twitter timeline instead:
https://twitter.com/Bitcoinbeach/status/1236142047138111488?s=20
A key part of the project involves training the people of El Zonte on how to pay and accept payments in Bitcoin.
https://twitter.com/Bitcoinbeach/status/1224813452851666944?s=20
The first BTC ATM has been installed in El Zonte
https://twitter.com/Bitcoinbeach/status/1231442588168785920?s=20
A Bitcoin Training Center/Homework center for the kids in the community being built with materials and contractor being paid in ₿.
https://twitter.com/Bitcoinbeach/status/1248394124664827904?s=20
https://twitter.com/Bitcoinbeach/status/1253405065613840385?s=20
Bitcoin Beach on how Bitcoin is helping the most vulnerable in a coastal village in El Salvador to get through the economic downturn caused by the COVID-19 pandemic.
As you can see, this project is going places and it is incredibly dynamic. To check out on all what Bitcoin Beach is up to, I really recommend you to follow their Twitter account:
https://twitter.com/Bitcoinbeach/status/1173987360259940352?s=20
Insights from the Founder
As I've mentioned several times here in my blog, I think Twitter is a wonderful place. It didn't just made me come across this project but also allowed me to reach out to
RR- Can you walk us through behind your vision for Bitcoin Beach?
MP – From the early days, Bitcoin promised to allow us to bank the unbanked, and return power back to the individual from governments and financial companies. In the decade since the Bitcoin whitepaper was released, Bitcoin has remained full of potential but lacking concrete examples of how it would actually ever achieve these purposes.
Bitcoin has remained primarily the domain of speculators, with disappointingly little real world transactional use. Sadly, we have not seen Bitcoin become a vehicle for the poor and unbanked to utilize in order to better their lives.
So we decided to challenge the growing assumptions that Bitcoin would never be used for daily transactions like buying a cup of coffee, and the assumption that Bitcoin would be used more by the wealthy than those looking to get to the first rung of the economic ladder.
RR- That's amazing! You have given us great insight on phase 1 of the project. Could you hint what phase 2 will bring for the project?
MP- Yes. We are now working on phase 2, which will focus on helping locals receive international remittances from their relatives in the US.
RR- Most of us who get in crypto have a notion of technology once we stumble upon but here we are talking adoption by unbanked individuals.
**In the coastal village you may have come across part of the population that are not familiar with this type of technology at all. How difficult has it been to bring someone from zero to hero in tech aspects, to be able of handling BTC ?
**
MP- Initially we started thinking that training and explaining Bitcoin had to come first. We quickly realized that we had it backwards. First thing is to get someone transacting in BTC. Once this happens they take the initiative to start learning more about it.
We help with this but we try to not focus too much on it. We believe that BTC will follow in footsteps of lots of other technology in that with wide adoption the technical aspects will be made more user friendly.
We are currently using Wallet of Satoshi which is amazingly easy to use. We are waiting for Ln_Stryke app to exit Beta to roll out a program encouraging family to use BTC to send remittances.
RR- This is outstanding. I really wish this project much success and now I can't wait to go to El Zonte and buy myself some pupusas and pay for them in Bitcoin.
RR- I can't close this article without asking: why El Zonte?
MP- I bought a house in El Zonte 15 years ago and we have lived here for the past 6 years. We were already working the community so it was natural place to start.
Living in El Zonte, Michael? Really?...well that makes me a bit (more like a lot) jealous...
https://media.giphy.com/media/GnFBKXaMJ1wYM/giphy.gif
Header photo by me.