Using Bitcoin To Build A Pet Hospital: A Lot of Bark?

The young, outspoken, and self-proclaimed “world’s coolest dictator,” El Salvadorian president Nayib Bukele, says he plans to use Bitcoin to fund the construction of a state-of-the-art pet hospital. The announcement came on Twitter in a series of tweets that quickly garnered backlash from those who think Bukele is barking up the wrong tree.

A Bark Worse Than His Bite?

The handsome millennial and former mayor of Nuevo Cuscatlãn and San Salvador became president of El Salvador in a historic election-winning as a third-party candidate outside of the country’s two major political parties in 2019. He quickly shook up the country and the world by strong-arming Parliament into firing an attorney general investigating several of his administration’s government institutions and five supreme court judges.  This paved the way for him to run for a second term, something not currently allowed in El Salvador. 

Bukele then declared Bitcoin the official currency of El Salvador alongside the U.S. dollar. Well, somebody had to be first and Bukele appears intent on being the top dog when it comes to world power and Bitcoin.  

These actions were called a “self-coup,” and protests broke out all over the country threatening to put Bukele in the doghouse. However, the press savvy and social media darling quelled protests and continues to confound the world with his vision of politics. 

Chivo Pets

The funds for the new pet hospital will come from a four million dollar surplus in the country’s Bitcoin trust thanks to a recent surge in BTC prices. Rumored to be dubbed Chivo Pets after Chivo Wallet (Chivo is slang for cool), the official Bitcoin and dollar wallet developed by the government of El Salvador allows users to make free transactions in Bitcoin and U.S. dollars for individuals and companies.

In a tweet, Bukele’s administration released a stylish video montage of animal hospital renderings promising the new facility would be able to handle emergency veterinarian appointments, operations, and have space for rehabilitation and grooming. It will also have a laboratory, classrooms, an auditorium, and a coworking area.

According to Bukele the surplus funds will not affect the total value of the trust and will keep the same quantity of bitcoin even when the U.S. dollar amount decreases. 

Not The Cat’s Meow

El Salvador’s economy is a bit unsteady and the government’s bond dropped six percent after the announcement came that Bitcoin would be the national currency. The International Monetary Fund (IMF) is considering throwing El Salvador a bone with a billion-dollar loan but criticized adopting Bitcoin as the national currency. The U.S. is not happy with Bukele’s authoritarian power moves and holds the most sway over whether or not the IMF will grant the loan to El Salvador. 

Siobhan Morden, head of Latin America fixed-income strategy at Amherst Pierpont Securities, wrote in a client note about El Salvador’s current economic situation: 

"The economic agenda remains subordinated to the political agenda with no clear framework on budgetary financing, no apparent commitment to fiscal discipline, and a political agenda that remains a drag on investment and growth."

Running Off-Leash

Besides the economic implications, critics of Bukele’s pet hospital plan pointed out the money would be better spent on more healthcare facilities for people. 

Other cryptocurrency founders have also been quick to slam Bukele’s move to adopt only Bitcoin as the national currency. 

“Vitalik Buterin, the co-founder of Ethereum, has also slammed President Bukele on adopting Bitcoin as legal tender, saying it goes against everything cryptocurrency stands for. Making it mandatory for businesses to accept a specific cryptocurrency is contrary to the ideals of freedom that are supposed to be so important to the crypto space,” Buterin said.”

A Paws-itive Outlook

Despite a shaky economy, a less than friendly relationship with the United States, and international and internal backlash over using surplus BTC funds for animals rather than people, Bukele continues to be enthusiastic and upbeat about the direction the country is taking. 

The brash young millennial President regularly praises the strength of his political party, which he founded in 2018. He previously tweeted: 

"Our country has a great future with young people like this (and a couple not so young)." 

Despite outcry from neighboring countries and from governments around the world, including the U.S. Bukele tweeted out; "our friends in the International Community... with all respect, we are cleaning our house... and that's none of your business."

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