With El Salvador’s Bitcoin Law poised to take effect, we speak with a prominent Salvadoran entrepreneur about his thoughts on the development.
Mario Gomez Lozada, CEO of PowerTrade, is a finance professional and serial entrepreneur with over 20 years of experience in the fixed income and currencies & commodities markets. In 2014, Lozada founded Liquid.com, one of the world's largest cryptocurrency-fiat exchange platforms serving millions of customers worldwide.
Lozada started his career in the mid 1990s in the internet industry where he developed early search engine technology based on his Computer Science Master’s thesis before moving to Tokyo and developing frameworks used as financial systems for a number of major banks. After spending 13 years of his career at Merrill Lynch developing cutting-edge software for sales and trading systems, Lozada joined Credit Suisse as Japan CIO and Head of Fixed Income IT Asia.
Mario Gomez Lozada’s voice shines like a ray of truth through a fog of misconceptions about El Salvador’s Bitcoin Law which goes into effect today. A clear signal amidst the noise of naysayers, his thoughts are sharpened by his experience as an internet, finance and technology pioneer and are sincere as they come from a man born and raised in El Salvador. As his insightful Bitcoin Magazine article explained last month, he is excited by the lead his home country is taking as the first in the world to make bitcoin legal tender. In this interview he offers further insight into a monetary moment that could reverse the global move away from sound money that started when President Nixon ended the convertibility of U.S. dollars to gold in 1971.
As an internet pioneer and expert in the fields of technology, finance and cryptocurrency, how does this law rank in the list of world-changing events you have witnessed first-hand?
To me this ranks as No. 2 after the invention of bitcoin 12 years ago. Frankly, as a Salvadoran citizen and someone who’s been working in the crypto space since 2014, this was very huge news for me.
With 44% of El Salvador’s population being under the age of 24 years, how much do you expect the law to hinge on this group’s engagement?
I think this move will impact everyone with a phone, but yes young people will likely be a major driver toward the adoption of this financial technology.
How important to this law’s success are the people who are sending remittances to El Salvador? Will their willingness to utilize bitcoin to protect the value of their remittances be a deciding factor in the law’s success?
I think it’ll come down to two things: One: fees, which can be as high as 10% or even 20% and two: ease of use. However, fees will drive adoption. We are talking about hundreds of millions of USD basically going back to the people of El Salvador.
How does El Salvador’s history with corrupt politicians influence the people’s trust in President Bukele making such a controversial move on the country’s behalf?
I never trusted any politician of El Salvador. As you said, the levels of corruption are extreme. However, President Bukele is in a league of his own. He has my trust and the trust of over 90% of the population. In his time in office, he’s done everything right, from an outstanding management of the pandemic to education and infrastructure. It’s only outsiders that have not lived in El Salvador that are judging him based on his predecessors and I think that’s wrong. But in the end, their opinions are irrelevant to many Salvadorans, including myself.
What would you tell protestors who are concerned about bitcoin’s price volatility and the downgrades that have come from ratings agencies since the bill passed into law?
Volatility will be no issue as they are not being forced to keep their funds in bitcoin. They can immediately convert to USD if they wish. Also, you need to understand that these protests are highly political in nature.
What would you consider a successful law rollout on March 7, 2022, six months after the law goes into effect?
It’ll come down to adoption. Bitcoin will coexist with USD in El Salvador. It will take months, maybe years, to be fully adopted, but it’ll get there once people realize the benefits.
What advice would you give President Bukele as he is weathering the storms of being the first mover in such a world-changing event?
I think his instincts as a Millennial are in the right direction. Keep on this direction and ignore the naysayers. In the end, time will tell whether these were the right decisions. I believe there is a high chance of success and will likely change the future of the country for the better.
What would you tell the leaders of other nations who are considering following El Salvador’s lead on this move to make Bitcoin a pillar of their financial structure?
Bitcoin is the hardest asset there is, bar none. It not only offers the opportunity to bypass the existing financial system, but it brings inclusivity to all citizens when it comes to financial services.
What changes, if any, would you make on the next Bitcoin bill passed by a sovereign nation-state?
I would say follow the exact same footsteps as El Salvador and go all in.
Which country do you think will be the next to pass a Bitcoin bill into law and why?
Probably neighboring countries in Central America will follow, mainly due to the realization of major economical benefits from reduced fees in remittances.
As Mr. Lozado makes clear, his country is taking the lead on financial inclusivity in a world that sorely needs it. While El Salvador may be feeling the fear-driven pressure to fail from the legacy financial system today, Bitcoiners are standing in support and celebrating the coming financial victories that await us tomorrow.
This is a guest post by Josh Doña. Opinions expressed are entirely their own and do not necessarily reflect those of BTC, Inc. or Bitcoin Magazine.