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El Salvador marks 1st year of Bitcoin use as confidence wanes

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A year ago, El Salvador began accepting Bitcoin as legal tender following a controversial and much criticized decision by President Nayib Bukele
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A year ago, El Salvador began accepting Bitcoin as legal tender following a controversial and much criticized decision by President Nayib Bukele.

All seemed rosy for the first few months as citizens enthusiastically embraced the new opportunity, but Bitcoin’s value has plummeted since and some experts say the move has been a failure.

Maria Aguirre, 52, a shopkeeper in the El Zonte seaside resort that has been a major center for Bitcoin use, says things were going well last year as Bitcoin’s value rose from $52,660 at opening on September 7, 2021, to briefly over $68,000 a couple of months later.

“But over the last five months it’s been only falling,” said Aguirre, who continues to accept Bitcoin transactions.

Bitcoin has dipped under $20,000 for most of this September.

In El Zonte, around 60 kilometers southwest of capital San Salvador, Bitcoin was already being used before Bukele’s move, which was designed to encourage a population where only 35 percent of people owned an account at a financial institution in 2021, according to the World Bank.

El Salvador became the first country to accept Bitcoin as legal tender, alongside the US dollar that has been the official currency for two decades.

The government even created the Chivo electronic wallet and granted each user the equivalent of $30.

By January, the application had been downloaded four million times, according to Bukele — an impressive amount in a country of 6.6 million, although with a diaspora of three million living mostly in the United States.

Bukele’s idea was to ensure that remittances, which make up 28 percent of El Salvador’s GDP, be sent by Chivo meaning less money lost in commission to exchange agencies.

However, former central bank president Carlos Acevedo says the body’s records show that “less than two percent of remittances are arriving through digital wallets, which means that this hasn’t been a benefit either.”

University student Carmen Majia, 22, said she used Bitcoin in the beginning “but given how things are going, now I don’t trust it and I uninstalled the application.”

– Volatility –

When Bukele’s plan was launched, Aguirre had already been using Bitcoin for eight months in the Pacific seaside resort that is popular with surfers.

After Bitcoin shot up in value between September and November 2021, Bukele announced a plan to build Bitcoin City — a tax haven for cryptocurrencies and blockchain technology on the Gulf of Fonseca that would be powered by geothermal energy from the Conchagua volcano.

To build it, Bukele was going to issue $1 billion in Bitcoin bonds but those plans were delayed by the volatile cryptocurrency market that saw some less robust currencies crash and Bitcoin take a huge hit.

According to the credit rating company Moody’s, Bukele’s plan has cost El Salvador $375 million.

Taking advantage of the drop in value, Bukele bought 80 Bitcoins at $19,000 each in July, taking El Salvador’s total holdings to 2,381 units of the cryptocurrency, all bought over the last year.

In June he told compatriots to “stop looking at the graph” insisting that Bitcoin is a secure investment that will bounce back up.

“Patience is the key,” he said.

– Little enthusiasm –

But Acevedo insists that the use of Bitcoin “really has not worked” and that “so far it has really been a failed bet.”

But not a total failure “because it could recover and get out of this crypto winter.”

Acevedo says Bitcoin has not produced Bukele’s stated aim of “financial inclusion” and its fall in value has “psychologically influenced people who do not view it with enthusiasm.”

The adoption of Bitcoin has also complicated El Salvador’s attempts to secure a $1.3 billion loan from the International Monetary Fund, which had urged against the move.

Faced with a warning that the country could default over its public debt that has surpassed 80 percent of GDP, Bukele announced in June a plan to buy back bonds due to expire in 2023 and 2025.

He insists the country has the cash to do so.

That reduced the country’s risk from 35 percent to 25 percent but Acevedo says El Salvador will not be able to return to the debt markets until that figure comes down to “at least five percent.”

In El Zonte, Cheetara Hasbún, a hotel employee, still thinks Bitcoin is a “good payment” method and just “needs more time, as was given to the dollar.”

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TikTok suspends rewards programme after EU probe

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TikTok Lite arrived in France and Spain in March allowing users aged 18 and over to earn points that can be exchanged for goods
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TikTok on Wednesday announced the suspension of a feature in its spinoff TikTok Lite app in France and Spain that rewards users for watching and liking videos, after the European Union launched a probe.

The popular video-sharing social media platform, owned by Chinese company ByteDance, said the suspension would remain  “while we address the concerns that they have raised”.

The European Commission’s top tech enforcer, Thierry Breton, said the EU investigation would continue, stating: “Our children are not guinea pigs for social media.”

TikTok Lite arrived in France and Spain — the only EU countries where it is available — in March. Users aged 18 and over can earn points to exchange for goods like vouchers or gift cards through the app’s rewards programme.

TikTok Lite is a smaller version of the popular TikTok app, taking up less memory in a smartphone and made to perform over slower internet connections.

The European Commission on Monday announced an investigation into TikTok Lite, and threatened to have the rewards programme suspended, raising concerns about the risk to users’ mental health.

The commission demanded TikTok provide more information by a Wednesday deadline, along with any defence against the threatened suspension.

Breton said in a statement that “our cases against TikTok on the risk of addictiveness of the platform continue”.

“We suspect that this (rewards) feature could generate addiction and that TikTok did not do a diligent risk assessment and take effective mitigation measures prior to its launch,” he said.

The probe is the EU’s second against TikTok under a sweeping new law, the Digital Services Act (DSA), that requires digital firms operating in the 27 nations to effectively police online content.

In February, the commission opened a formal probe into TikTok over alleged violations of its obligations to protect minors online.

– TikTok squeezed –

TikTok is also under pressure across the Atlantic.

A bill to ban TikTok cleared the US Congress after the Senate on Tuesday approved legislation requiring TikTok to be divested from ByteDance.

TikTok’s CEO, Shou Zi Chew, said the company would fight the law — which he said amounted to a ban — in US courts.

The European Commission has refused to comment on the United States’ move. Instead it has focused on the EU’s legal arsenal to bring big tech into line with its rules.

The move against the TikTok Lite rewards scheme was the latest instance of the EU flexing that legal muscle against online platforms.

It is also investigating tech billionaire Elon Musk’s X, the former Twitter, over alleged illegal content.

TikTok Lite users can win rewards if they log in daily for 10 days, if they spend time watching videos (with an upper limit of 60 to 85 minutes per day), and if they undertake certain actions, such as liking videos and following content creators.

TikTok is among 22 “very large” digital platforms, including Amazon, Facebook, Instagram and YouTube, that must comply with stricter rules under the DSA since August last year.

The law gives the EU the power to hit companies with heavy fines as high as six percent of a digital firm’s global annual revenues. Repeat offenders can see their platforms blocked in the EU.

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In Brazil, hopes to use AI to save wildlife from roadkill fate

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Some 475 million vertebrate animals die on Brazilian roads every year
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In Brazil, where about 16 wild animals become roadkill every second, a computer scientist has come up with a futuristic solution to this everyday problem: using AI to alert drivers to their presence.

Direct strikes on the vast South American country’s extensive road network are the top threat to numerous species, forced to live in ever-closer proximity with humans.

According to the Brazilian Center for Road Ecology (CBEE), some 475 million vertebrate animals die on the road every year — mostly smaller species such as capybaras, armadillos and possums.

“It is the biggest direct impact on wildlife today in Brazil,” CBEE coordinator Alex Bager told AFP.

Shocked by the carnage in the world’s most biodiverse country, computer science student Gabriel Souto Ferrante sprung into action.

The 25-year-old started by identifying the five medium- and large-sized species most likely to fall victim to traffic accidents: the puma, the giant anteater, the tapir, the maned wolf and the jaguarundi, a type of wild cat.

Souto, who is pursuing a master’s degree at the University of Sao Paulo (USP), then created a database with thousands of images of these animals, and trained an AI model to recognize them in real time.

Numerous tests followed, and were successful, according to the results of his efforts recently published in the journal Scientific Reports.

Souto collaborated with the USP Institute of Mathematical and Computer Sciences.

For the project to become a reality, Souto said scientists would need “support from the companies that manage the roads,” including access to traffic cameras and “edge computing” devices — hardware that can relay a real-time warning to drivers like some navigation apps do.

There would also need to be input from the road concession companies, “to remove the animal or capture it,” he told AFP.

It is hoped the technology, by reducing wildlife strikes, will also save human lives.

– ‘More roads, more vehicles’- 

Bager said a variety of other strategies to stop the bloodshed on Brazilian roads have failed.

Signage warning drivers to be on the lookout for crossing animals have little influence, he told AFP, leading to a mere three-percent reduction in speed on average.

There are also so-called fauna bridges and tunnels meant to get animals safely from one side of the road to the other, and fences to keep them in — all insufficient to deal with the scope of the problem, according to Bager.

In 2014, he created an app called Urubu with other ecologists, to which thousands of users contributed information, allowing for the identification of roadkill hotspots.

The project helped to create public awareness and even inspired a bill on safe animal crossing and circulation, which is awaiting a vote in Congress. 

A lack of money saw the app being shut down last year, but Bager is intent on having it reactivated.

“We have more and more roads, more vehicles and a number of roadkill animals that likely continues to grow,” he said.

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Honda to build major EV plant in Canada: govt source

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Honda hopes to sell only zero-emission vehicles by 2040, with a goal of going carbon-neutral in its own operations by 2050
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Japanese auto giant Honda will open an electric vehicle plant in eastern Canada, a Canadian government source familiar with the multibillion-dollar project told AFP on Monday.

The federal government as well as the province of Ontario, where the plant will be built, will both provide some financial incentives for the deal, according to the source, who spoke on condition of anonymity.

The official announcement is due Thursday, though Ontario premier Doug Ford hinted at the deal on Monday.

“This week, we’ve landed a new deal. It will be the largest deal in Canadian history. It’ll be double the size of Volkswagen,” he said, referring to a battery plant announced last year, for which the German automaker pledged Can$7 billion (US$5 billion) in investment.

Canada in recent years has been positioning itself as an attractive destination for electric vehicle investment, touting tax incentives, renewable energy access and its rare mineral deposits.

The Honda plant, to be built an hour outside Toronto, in Alliston, will also produce electric-vehicle batteries, joining existing Volkswagen and Stellantis battery plants.

In January, when news of the deal first bubbled up in the Japanese press, the Nikkei newspaper estimated it would be worth Can$14 billion — numbers backed up by Canadian officials recently.

In the federal budget announced last week, Prime Minister Justin Trudeau’s government introduced a new business tax credit, granting companies a 10 percent rebate on construction costs for new buildings used in key segments of the electric vehicle supply chain.

Canada’s strategy follows that of the neighboring United States, whose Inflation Reduction Act has provided a host of incentives for green industry.

Honda hopes to sell only zero-emission vehicles by 2040, with a goal of going carbon-neutral in its own operations by 2050.

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