The users of the application used the freezing of the bitcoin value for one minute, which occurs when the conversion is made. During this time, they compared rates on exchanges and made a profit using arbitrage
The developers of the Salvadoran crypto wallet Chivo have disabled the display of the bitcoin price when buying or selling it in the app. According to the announcement of the project team, users used the freezing of the value of the first cryptocurrency for one minute, which occurs when making an exchange, in order to make money on the difference in rates through arbitration. In a minute, users managed to compare the price of bitcoin on crypto-exchanges.
If the value of bitcoin on the exchanges rises, users buy the asset in Chivo, taking advantage of the fact that it is blocked. When the price of an asset on the exchanges decreases, the user is sold it at the cost fixed by the application.
Also, the Chivo developers will refuse to freeze the cost of bitcoin and change the algorithm for converting funds. In the near future, the application will return the display of the bitcoin price when making a transaction. After that, the conversion of funds will take place in real time, taking into account the current exchange rate.
On October 16, El Salvador's President Nayyib Bukele reported that residents of the country are depositing much more US dollars into the Chivo wallet than they are withdrawing.
Chivo is a cryptocurrency wallet that was developed by the government of El Salvador after bitcoin became the official means of payment in the country along with the US dollar.
On September 7, El Salvador entered into force a law granting the first cryptocurrency the status of legal tender. On the same day, the country's authorities bought 550 bitcoins. Later, the President of El Salvador Nayib Bukele announced the purchase of another 150 bitcoins.