(Adds story links, details of unbanked and internet penetration, bitcoin selloff)
By Anthony Esposito and Nelson Renteria
SAN SALVADOR, Sept 7 (Reuters) – El Salvador on Tuesday became the first country to adopt bitcoin as legal tender, a real-world experiment proponents say will lower commission costs for billions of dollars sent from abroad but which critics warned may fuel money laundering.
The change means businesses should accept payment in bitcoin alongside the U.S. dollar, which has been El Salvador’s official currency since 2001 and will remain legal tender.
President Nayib Bukele, who has pushed for adopting the cryptocurrency, says it will help Salvadorans save about $400 million the government calculates is spent annually on commissions for remittances, while giving access to financial services to the unbanked.
The 40-year-old president is popular with the public but has been accused of eroding democracy, including by the administration of U.S. President Joe Biden.