Strike Abandons USDT In El Salvador

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When El Salvador passed a law making bitcoin legal tender in the country, it did not just set itself on a path to add the payment option to existing infrastructure. It provided regulatory clarity that allowed an existing Bitcoin-forward platform to better serve its citizens.

Thanks to the regulation, Strike, the Lightning Network-focused startup helping El Salvador build its national bitcoin-based payments system, will no longer need to substitute U.S. dollars with Tether’s USDT stablecoin.

Why Strike Had To Use USDT In El Salvador

Strike CEO Jack Mallers shared on a recent episode of the “What Bitcoin Did” podcast that, before his first trip to El Salvador to work with the Bitcoin Beach community, he connected with some financial institutions in the country and discovered that it was illegal for a financial service to custody dollars on behalf of a user. In addition, there was no regulatory clarity on Bitcoin in El Salvador at that time.

As a result, he immediately saw an impairment to helping the majority of the country’s population that does not have access to the traditional banking system by implementing Strike.

Consequently, Strike, which leverages dollars and the Bitcoin Lightning Network to allow instant, cheap payment transfers worldwide without intermediaries, had to resort to using USDT to achieve basic, minimum-viable-product functionality in El Salvador.



Source link Bitcoin Magazine

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