El Salvador's bitcoin wallet users hit by glitches, fraud

Users have fallen victim to scammers promising to solve technical issues on the platform and have lost significant amounts of money in the process

The use of crypto currency as legal tender has been in force in El Salvador since Sept. 7, and in that period, user complaints continue to pile up.

According to the country’s treasury department, $30,000 in taxes have been paid with the virtual Chivo Wallet after the Ministry of Finance authorized the payment of taxes, including VAT, income tax and import duties, with bitcoin starting the week of Oct. 18.

In order to make the payment, the user has to scan the QR code generated at the payment window, the Treasury said in the statement, adding in a Tweet that “In our tax offices you can pay quickly and easily with your @chivowallet.”

But as tax payments are being made, ongoing failures have cast a dark shadow on the government’s widely anticipated bitcoin wallet and users are not holding back.

Users have fallen victim to scammers promising to solve technical issues on the platform and have lost significant amounts of money in the process. Other reported failures include Unique Identity Document (UID) usurpation, incompatibility with other wallets and ongoing technical maintenance.

Following numerous complaints, including situations where citizens’ personal data have been stolen to get the $30 worth of free bitcoin Salvadorans receive for signing up for the wallet, several opposition parties have filed a citation asking the legal representative of the company, Chivo S.A. de C.V., to report to the Assembly to answer questions on the ongoing issue.

Users have also called out the government on the high commission fees charged with each transaction.

They are stealing our money, a user wrote on social media, an accusation which some may say is not far-fetched given that when promoting the wallet, the government had said that there will be no cost to using it or commissions on sending or receiving remittances, making or receiving payments or converting bitcoin to dollars or vice versa.