Some Santa Lucia residents, like mall owner Cesar Andino, expect the initiative to open up more opportunities for shops in the area and "attract more people who want to use this currency," according to a report by Honduran media outlet La Prensa.
Andino added: “Accepting Bitcoin will allow us to open another market and win more customers. We have to globalize. We can't close ourselves off to technology and we can't be left behind when other countries are already doing it."
The program began on July 28, allowing patrons of local stores to pay with US dollars, Honduran lempira or Bitcoin. The municipal government of Santa Lucia developed the Bitcoin Valley program in collaboration with the crypto exchange Coincaex, Blockchain Honduras and the Technological University of Honduras.
Coincaex provides the equipment and services needed to make crypto payments, while Blockchain Honduras provides education on the use of crypto wallets. La Prensa explained that while customers can pay for goods and services in Bitcoin, they will be sending the cryptocurrency to the Coincaex exchange.
The exchange then instantly sends the Bitcoin value in Lempira (Honduran currency) to the trader to help them avoid loss due to price volatility. Therefore, business owners do not directly receive Bitcoin as a means of payment under this scheme.
Entrepreneurs are hoping that this will increase their business
Local entrepreneurs are hoping that Bitcoin Valley will reignite tourism spending in this tropical coastal country after a major economic hit during the COVID-19 pandemic.
Honduras enjoyed about $556 million in annual tourism spending in 2019 before traffic fell by more than 66% in 2020 to $189 million, according to Macrotrends data. Honduras joins a handful of countries in the region that have launched similar programs to legally pay for goods and services with cryptocurrencies.
El Salvador famously adopted Bitcoin as legal tender in 2021 and has undertaken a nationwide effort to educate residents about its usefulness. A similar tourist attraction 'Bitcoin Beach' was launched in the town of El Zonte.
Guatemala has its own 'Bitcoin Lake' initiative at tourist spots around Lake Atitlan in the Sierra Madre Mountains. The mayor of the region, Cesar Piedrasanta Panajachela, also mined Bitcoin with energy that he says would otherwise be unused and wasted.