The year 2021 will probably go down the history books as one of Bitcoin’s (BTC) most interesting years, given its recent uptake by billionaires and adoption by mainstream institutions, not to mention El Salvador’s move to make it legal tender.

In El Salvador’s case, it almost seems as if the whole world is watching this experiment to see whether it will be a success or a total failure for the Central American nation.

With Sept. 7 marking the official implementation of Bitcoin as a legal tender in El Salvador, a wave of protests in the country against the move has roused suspicions and uncertainty over how the new law will be enforced.

From the arrest of individuals criticizing the Salvadoran government over the new law, to the wave of citizens across the country protesting Bitcoin’s legal status, the seminal crypto is facing some headwinds.

How Bitcoin became legal tender

It all began in early June after Salvadoran president Nayib Bukele announced in a tweet that the country’s legislative assembly had passed a bill making Bitcoin legal tender. The law was set to be implemented on Sept. 7 and would see the country’s 4.5 million citizens able to make purchases with Bitcoin at stores nationwide.

In his announcement, Bukele said that once an official bill to make Bitcoin legal tender was passed, “Chivo ATMs” — Chivo being the name of the official BTC wallet for El Salvador — would eventually be “everywhere” in the country. This would allow El Salvadorans to withdraw Bitcoin in cash without incurring any commissions on their holdings, as is the case with services such as Western Union.

Moreover, Bukele assured citizens that no one will be forced to use Bitcoin. In a statement, the 40-year-old president said that “someone can always queue up at Western Union and pay a commission.”

“What if someone doesn’t want to use Bitcoin? [Well] don’t download the app and continue living your normal life. Nobody is going to take your dollars,” he said.

The first wave of resistance

Following the announcement, a group of protestors called the Popular Resistance and Rebellion Block (BRRP) block emerged to protest against the Bitcoin law.

“President Nayib Bukele passed the law making the cryptocurrency legal tender in the country without proper consultations with the people,” one activist said.

Although the protest group highlighted complexities such as Bitcoin’s volatility as reasons for caution, their main claim is that the law mainly serves large businesses linked to alleged money laundering to the benefit of corrupt officials.

“Bitcoin only serves some large businessmen, especially those linked to the government, to launder ill-gotten money,” one protestor said.

A letter from the BRRP group said that “entrepreneurs who put their capital in Bitcoin will not pay taxes on their earnings and the government would spend millions worth of taxes to execute the whole campaign.”

Indeed, the bill to make Bitcoin legal tender includes some interesting proposals such as a zero capital gains tax on BTC. The bill also promised investors permanent residency in the country with a three BTC investment in El Salvador.

The arrest of Mario Gómez

As the controversial Bitcoin bill became a law on Sept. 7, both supporters and detractors continue to emerge with the latest in events around the law being the arrest of Mario Gómez.

According to several local news outlets in El Salvador, Mario Gómez — a computer and crypto expert as well as an avid critic of the government — was arrested by local police and held for a few hours before being released.

Gómez has been known to regularly post on social media opposing the government’s move to make Bitcoin legal tender. Observers such as Steve Hanke — an economist from Johns Hopkins University — criticized Gómez’s arrest as an “authoritarian police tactic in action.”

Hector Silva, a counselor of the mayor’s office in San Salvador, said, “the arrest of Mario portrays the fragility of the government in terms of the implementation of the Bitcoin law but confirms something even more dangerous.”

“They are willing to manipulate whatever institutions are necessary to push critical voices out of the way,” added Silva.

Although the police released a statement saying that Gómez was detained as part of a financial fraud investigation, news reports claimed that he was arrested without a warrant and an attempt was made to take possession of his phone and computer.

The citizens’ protest

Right before Gómez’s arrest, some retirees in El Salvador took to the streets to protest, worried about the government using the cryptocurrency to pay their pensions.

While speaking to reporters, one demonstrator from the crowd — which included veterans, disability pensioners, workers and retirees — said, “we know this coin fluctuates drastically. Its value changes from one second to another, and we will have no control over it.”

While Bukele has promised that the use of Bitcoin in the country will be optional and that salaries and pensions will still be paid in United States dollars, the protestors still highlighted a lack of knowledge of the technology.

Citizens have also complained that there has been too little explanation from officials about the pros and cons of Bitcoin. “We don’t know the currency. We don’t know where it comes from. We don’t know if it’s going to bring us profit or loss. We don’t know anything,” one Salvadoran added.

In response, Bukele’s administration has stated that the use of Bitcoin is not mandatory and that necessary training and other alternatives to Bitcoin will be provided.

Mixed opinions

Although President Bukele enjoys incredibly high approval ratings, recent polls concerning the Bitcoin law show a widespread lack of support for the measure. A recent poll conducted by El Salvador’s Universidad Centroamericana José Siméon Cañas shows that up to two-thirds of respondents are inclined toward a move to repeal the law, and more than 70% prefer the U.S dollar over Bitcoin.

International institutions like the International Monetary Fund have also warned about macroeconomic, financial and legal issues brought about by El Salvador’s adoption of Bitcoin.

Siobhan Morden, head of Latin America Fixed Income Strategy at Amherst Pierpont, said that “the plans for Bitcoin under an increasingly autocratic regime will likely only compound concerns about corruption.”

On the flip side, others remain optimistic that the new law will eventually benefit Salvadorans given that the country’s economy is heavily reliant on remittances sent home by migrants overseas. Last year alone, the country’s remittances totaled $6 billion, accounting for a fifth of gross domestic product.

“El Salvador’s adoption of Bitcoin as legal tender by law offers the country some optionality in financial matters and sovereignty,” said Alexander Blum, managing director of Two Prime.

His sentiments were echoed by Alberto Echegaray Guevara — an artist and entrepreneur — who said, “President Bukele’s Bitcoin Law is not only trying to make international money transfer cheaper and easier for 70% of his unbanked population but also creating a new economic hub and new remittances platform in Central America.”

Adrian Pollard from HollaEx told Cointelegraph, “It is typical for new technology rollouts to have bugs and apposition but that’s exactly why it was made voluntary.”

“I suspect there will be more bumps along the road for El Salvador but it will be worth it long term. In fact, I believe other South American nations aren’t far behind and will follow,” added Pollard.

In his announcement, Bukele said that once an official bill to make Bitcoin legal tender was passed, “Chivo ATMs” — Chivo being the name of the official BTC wallet for El Salvador — would eventually be “everywhere” in the country. This would allow El Salvadorans to withdraw Bitcoin in cash without incurring any commissions on their holdings, as is the case with services such as Western Union.

Source: https://cointelegraph.com/news/el-salvador-s-bitcoin-detractors-opposition-mounts-despite-crypto-rollout

Long stuck in the shadows of Bitcoin (BTC), Ethereum (ETH) finally took hold of the market in 2020 during the decentralized finance summer. Designed to recreate traditional financial systems with fewer middlemen, DeFi is now being used across lending, borrowing, and the buying and selling of tokens. The majority of these decentralized applications (DApps) are run on Ethereum, which saw activity on the network increase during 2020. This activity also trended upwards due to yield farming, also known as liquidity mining, which enables holders to generate rewards with their crypto capital.

But as activity on Ethereum increased, so too did the network’s transaction fees. In May, it was reported that Ethereum gas fees were skyrocketing. It’s intuitive that engaging in DeFi is only worthwhile when handling capital that exceeds any network fees. Consequently, it soon became clear to users that the blockchain was verging on unusable.

Related: Where does the future of DeFi belong: Ethereum or Bitcoin? Experts answer

Without a doubt, Ethereum remains the most active and populated blockchain, but other potential players are popping up, providing a viable alternative to Ethereum. For example, layer one protocols such as Binance Smart Chain (BSC) and Solana (SOL) are attracting billions in assets under management, whereas layer two solutions such as Polygon (MATIC) are capturing Ethereum’s disgruntled users’ attention due to their compatibility with Ethereum-based protocols. This is in addition to delivering low fees and quick transaction speeds. However, despite Ethereum gas fees reaching a high over the past year and the growth of faster networks, none of these chains have killed Ethereum yet.

It’s because of this, as we enter the second half of 2021, that the narrative of “Ethereum vs. the rest” is starting to change — developers are realizing the value of a cross-chain future rather than having to pick one blockchain to build on. It’s no longer a case of creating a chain with a competitive edge, but of ensuring all chains can work interchangeably to improve the industry.

Related: A multichain future will accelerate innovators and entrepreneurs

Benefits and drawbacks of a multichain future

Due to its prominence and longstanding presence in the market, Ethereum has the first-mover advantage and remains the most significant blockchain within the DeFi ecosystem as of Q1 2021. But with other chains gaining momentum, it is these alternatives to Ethereum that are providing the benefits of faster transaction speeds and significantly lower fees.

The introduction of other chains isn’t necessarily a bad thing, even for Ethereum fans. After all, a multichain ecosystem brings additional space for new protocols to enter, each with a strong user base. Each new chain also creates a new community, vacancies for services, and an individual identity and culture.

Related: Too little, too late? Ethereum losing DeFi ground to rival blockchains

One possible drawback, depending on how you look at it, is that some blockchains require unique programming languages, such as JavaScript, Rholang, Simplicity, Rust or Solidity, which may present a barrier to entry for developers. At the same time, however, different coding languages can present a new way for developers to solve a problem. And as the blockchain space moves further towards multichain, it may inspire developers to create and innovate as they witness the diversity in viable blockchain projects. It’s for this reason that projects which don’t innovate could be seen as lagging and abandoned by their community.

Not only that, but separated blockchains create innovation silos, presenting challenges to progress and adoption. Joining the multichain future together can be seen as seamlessly connecting these specialized groups. This could be seen as a difficult objective to achieve in the traditional tech world, but cryptocurrency and blockchain are challenging these existing infrastructure monopolies, and this industry has the ability to pioneer an ecosystem that works cohesively rather than competitively.

Related: Life beyond Ethereum: What layer-one blockchains are bringing to DeFi

More blockchains, more value

It’s inevitable that projects will eventually connect multiple blockchains, making the transfer of information from one chain to another seamless. In fact, the cryptocurrency market and multichain adoption is less of a zero-sum game than is often cited. And, as the multichain future becomes more apparent, it will only become clearer that the additional functionality, usability and scalability it brings is contributing to the onboarding of new users.

Related: The great tech exodus: The Ethereum blockchain is the new San Francisco

Rather than viewing the existence of a multichain future with doubt, it should be looked on positively. There are plenty of different smart contract platforms in the crypto ecosystem, all of which impact the blockchain space in terms of accessibility, economic viability and innovation. Blockchains may be separated right now, but everything will come together in the end, creating an interoperable and fast network of protocols that fulfils our daily needs. The beauty of this is that we won’t have to worry about how we’re transacting or what we’re transacting on, as it won’t matter.

We’re still far from achieving the end goal of interoperability, but once it’s achieved mass adoption, the crypto industry will be unstoppable. And, as the sector continues to grow, projects are finding that they have to adapt to a multichain future soon or risk getting left behind.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Michael O’Rourke is the co-founder and CEO of Pocket Network. Michael is a self-taught iOS and Solidity developer. He was also on the ground level of Tampa Bay’s Bitcoin/crypto meetup and consultancy, Blockspaces, with a focus on teaching developers Solidity. He graduated from the University of South Florida.

Without a doubt, Ethereum remains the most active and populated blockchain, but other potential players are popping up, providing a viable alternative to Ethereum. For example, layer one protocols such as Binance Smart Chain (BSC) and Solana (SOL) are attracting billions in assets under management, whereas layer two solutions such as Polygon (MATIC) are capturing Ethereum’s disgruntled users’ attention due to their compatibility with Ethereum-based protocols. This is in addition to delivering low fees and quick transaction speeds. However, despite Ethereum gas fees reaching a high over the past year and the growth of faster networks, none of these chains have killed Ethereum yet.

Source: https://cointelegraph.com/news/the-future-of-defi-is-spread-across-multiple-blockchains

Chainalysis has secured hundreds of millions of dollars in the second quarter as venture firms allocate more resources to the emerging blockchain sector.

Blockchain analytics company Chainalysis has secured $100 million in Series E financing, bringing its total valuation to a staggering $4.2 billion and highlighting once again the tremendous growth of the cryptocurrency industry.

The round was led by global investment manager Coatue, with additional participation from 9Yards Capital, Altimeter, Blackstone, GIC, Pictet, Sequoia Heritage and SVB Capital, Chainalysis announced Thursday.

Chainalysis said the funds will go toward expanding its blockchain data capabilities, which includes investing in new data tools, software and APIs.

“We believe blockchain data is the asset that can help public and private sector organizations understand the risks and opportunities surrounding this asset class and promote its adoption safely and successfully,” the company said.

Chainalysis’ valuation has more than doubled in the last quarter thanks to several strategic investments. As Cointelegraph reported, the company closed out a $100 million Series D round in March led by Paradigm, a crypto-focused investment firm. At the time, Chainalysis’ director of communications Maddie Kennedy told Cointelegraph that the funds will be used to expand the company’s enterprise data offering.

Related: Crypto-finance company Amber Group valued at $1B following $100M raise

Mega-million-dollar funding rounds have become commonplace in the cryptocurrency industry over the last six months. Venture firms have poured billions into crypto startups this year alone, with the likes of Andreessen Horowitz going a step further by announcing a new $2.2 billion crypto venture fund.

What’s more, dealmaking seems to be happening irrespective of current market conditions, which marks an important evolution from the 2017 bull market that saw venture funding dry up once the initial coin offering mania faded.

Source: https://cointelegraph.com/news/chainalysis-raises-100m-in-series-e-funding-led-by-coatue