El Salvador’s legalization of Bitcoin (BTC) has given its citizens new payment options, with fast-food giant McDonald’s reportedly accepting Bitcoin payments via the Lightning Network.
Journalist Aaron van Wirdum broke the news on Tuesday after visiting a McDonald’s in El Salvador and being given a printed QR code that directed him to an invoice page on Lightning Network. As of 2019, there are 19 McDonald’s locations in Latin America.
Lightning is a layer-two payment protocol designed to increase the scalability of Bitcoin transactions. Although Bitcoin has been a successful investment asset, its use as a medium of exchange has been limited. Bitcoin payments were central to Satoshi Nakamoto’s 2008 whitepaper, which described BTC as electronic cash. (Intriguingly, in Nakamoto’s forum posts and correspondence, the terms “cash” and “gold” were used interchangeably.)
If El Salvador hopes to achieve widespread adoption of Bitcoin payments, the Lightning Network will most likely be invaluable. Beyond immediate transactions, El Salvador’s Bitcoin gamble could pay off by streamlining global remittances, increasing citizen wealth, and attracting crypto-focused entrepreneurs to the country.
El Salvador’s Bitcoin Law went into effect on Tuesday, proving to be a classic “buy the rumor, sell the fact” market event. Between Monday and Tuesday, the BTC price fell 19% from peak to trough, reaching a low of $42,900.
On Monday, President Nayib Bukele confirmed that his government had purchased its first Bitcoin. The country had 550 BTC in reserves as of Tuesday.