Cathie Wood predicts El Salvador’s Bitcoin and AI initiatives to drive a tenfold increase in GDP by 2029.

El Salvador has the potential to experience a tenfold increase in its gross domestic product (GDP) within the next five years if it continues to pursue its Bitcoin and artificial intelligence (AI) adoption plan under President Nayib Bukele, according to Cathie Wood, CEO of ARK Invest. Wood expressed her belief that President Bukele’s commitment to transforming El Salvador into a hub for the Bitcoin and AI communities, two of the largest economic and technological revolutions in history, is the driving force behind the projected growth. The discussion between Wood and Bukele centered around Bitcoin’s integration into capital markets, AI, and tax policies. Max Keiser, an advisor to Bukele on Bitcoin-related matters, mentioned that Wood provided insights on how El Salvador can achieve a tenfold increase in GDP to reach $300 billion by 2029. The meeting was also attended by Bitcoin advocate Stacy Herbet, US economist Arthur Laffer, and ARK Invest research associate Marc Seal. El Salvador’s GDP stood at $32.4 billion in 2022, marking a 30% increase since Bukele assumed office in June 2019, as per data from the World Bank. Reaching $300 billion would put El Salvador’s GDP on par with Romania, the Czech Republic, and Chile. El Salvador has taken significant steps to embrace Bitcoin, including making it legal tender, eliminating taxes on tech innovation, and removing income tax for foreign investments and remittances. The country also formed a strategic partnership with Google in April 2024, with the tech giant investing $500 million in the country. El Salvador currently holds 5,764 Bitcoin in its treasury, worth $396.2 million, reflecting a 58.6% increase from its average purchasing price. However, the adoption of Bitcoin among the local population has faced challenges due to a lack of technical literacy, limited merchant acceptance, and issues with the rollout of the Chivo Wallet in 2021. In 2023, only 12% of the local population used Bitcoin for payments, a decrease from the previous year, according to a survey conducted by José Simeón Cañas Central American University. The upward price trend of Bitcoin in early 2023 has sparked a new wave of merchant adoption in recent months, led by major companies such as Walmart, Starbucks, and Domino’s.