Most of El Salvador’s legislators have voted to accept Bitcoin as legal tender. The President will sign the law shortly.
In today’s vote, the vast majority of El Salvador’s Legislative Assembly members voted in favor of President Nayib Bukele’s proposal to accept Bitcoin as legal tender in the country. The President intends to sign the law within 24 hours.
Sixty-two legislators voted in favor of the bill, nineteen against, and three abstained. Bukele said the initiative is an attempt to improve the availability of financial services in a country where only 30% of citizens have access to financial services. According to him, citizens will not be required to use the state cryptocurrency wallet.
Bukele said the country is drafting a new law that will grant a residence permit to anyone who invests 3 BTC in El Salvador’s economy. According to him, the law will oblige all organizations to accept BTC to pay for goods or services, but the government will support companies that do not want to take the risk of cryptocurrency volatility.
The trust that the government will set up in the Development Bank of El Salvador to instantly convert BTC to US dollars will take on the traders’ risk. The trust fund will hold approximately $ 150 million.
“Some businesses, like ice cream parlors, are not willing to take risks. They have to accept bitcoins because it’s legal tender, but they don’t want to risk convertibility. These companies want dollars to be deposited into their bank account. When a cafe sells ice cream, it can ask the government to exchange its BTC for dollars. Of course, a business owner can do it in the markets, but he can ask the government to do it immediately. ”
The Development Bank Trust will sell part of the received BTC for dollars to replenish the fund. In the coming days, government officials in El Salvador will meet with representatives of the International Monetary Fund to discuss a plan for the further development of the economy in the new environment. Bukele also said the government could start promoting BTC mining in the country.
As a reminder, since April 1, 2017, bitcoin has also been recognized as legal tender in Japan and is regulated similarly to foreign currencies.
I am Derek Black, an author of World Stock Market. I have a degree in creative writing and journalism from the University of Central Florida. I have a passion for writing and informing the public. I strive to be accurate and fair in my reporting, and to provide a voice for those who may not otherwise be heard.