El Salvador has brought in a new encryption software provider for its Chivo Bitcoin wallet, which has sparked a flood of complaints about failed transactions, lost funds and other technology issues.
US developer AlphaPoint is now providing the infrastructure for the cryptocurrency wallet, the country’s government announced on Tuesday.
El Salvador began issuing Chivo wallets to its citizens shortly after becoming the first country in the world to adopt bitcoin as legal tender in September. The mobile app allows individuals and businesses to send and receive bitcoins.
But Chivo users have reported a range of issues, such as identity theft, funds disappearing from wallets, blocked accounts, and unauthorized transactions. According to reports, phishing scams and bots targeted people seeking help on social media.
The government put $30 worth of bitcoin in each wallet to encourage its use. Several people claimed the hackers opened their Chivo wallets with their ID numbers to claim the inducement, The Block reported.
Athena Bitcoin, a Bitcoin ATM provider and operator, provided the technology for the Chivo wallet before being replaced by AlphaPoint.
“El Salvador and President Bukele are truly leading the world in terms of national bitcoin adoption,” AlphaPoint co-founder and CEO Igor Telyatnikov said in a statement.
“No one else has even attempted a project of this nature. At AlphaPoint, we are honored to be involved in the process and to provide solutions that are both reliable and consistent with the scale of this effort. Chivo Wallet app supports millions of Salvadorans, many of whom are accessing financial services for the first time.”
Bukele said making bitcoin legal tender will make it easier for people to access financial services and send and receive funds from abroad. About 71% of Salvadorans do not have a bank account, according to Statista.
But in January, the IMF urged El Salvador not to use bitcoin as legal tender, stressing that financial stability and consumer protection risked an appeal rejected by Bukele.