This is How Bitcoin Wallets Work in El Salvador

President Bukele of El Salvador has claimed that one-third of the country's population is now actively using Chivo, a digital wallet designed to allow for easier transactions. This is part of the President's plan to modernize and promote technology in the Central American nation. The first step was introducing internet banking services last year, which will soon be joined by fingerprint recognition as an option on ATMs. There are also plans to introduce electronic declarations at customs points and eventually smart cards with biometric data for all citizens to aid with payment for public services.

The state has already used Chivo to pay out salaries and other benefits and government suppliers. The state-run telecommunications company Antel also allows direct payments to be made through Chivo. This will make it easier for people to pay their taxes and other bills, President Bukele said. "I'm talking about a future where you can go to the bank to have your salary credited directly toward your Chivo wallet. You will not need to use checks or cash anymore," he told a ceremony at the National Telecommunications Institute (Intel).

Bukele has promised that as soon as this is in place, anyone who refuses Chivo will be required by law to issue official receipts. He also thinks that once consumers see how easy it is, they can guarantee that those receiving goods from them also accept it as payment – giving merchants an incentive not to refuse Chivo because customers want them to.Chivo users can use their phones or tablets to pay bills, buy bus tickets or pay traffic fines without having cash on them - something that is proving popular amongst young people who might not have bank accounts.

Speaking at an event in Morazán, President Bukele said: "I really like the idea of Chivo because it's something that is very simple and easy to use... We are talking about your phone, in your pocket. It not only makes life easier, but it helps us bridge this digital divide". Chivo is an app developed by the Bancos Comercial e de Ahorros (COMERCI Bank and Savings), Banco Azteca El Salvador and the G&T Continental. It is available to customers of these banks, who can use it for transactions in currency or digital currency, such as Bitcoin.