El Salvador Is the First Country In the World To Recognize Bitcoin As Legal Tender
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El Salvador is officially the first country in the world to recognize Bitcoin as legal tender.
“The purpose of this law is to regulate bitcoin as unrestricted legal tender with liberating power, unlimited in any transaction, and to any title that public or private natural or legal persons require carrying out,” reads the law.
The law was passed by a supermajority in congress–62 out of 84 votes. As of now, the US dollar the legal tender of El Salvador. In 90 days, Bitcoin will be as well.
El Salvador’s president, Nayib Bukele, believes Bitcoin law will “will bring financial inclusion, investment, tourism, innovation and economic development for our country.”
According to the bill, 70% of Salvadorans do not have a bank account. Bitcoin Law would “open up” financial services to a large swatch of people who otherwise do not have access to bank services.
Proponents also believe that the law will help expat Salvadorans sent remittances (money sent home from abroad) to their family members–a financial act that makes up one fifth of the country’s GDP.
Per Yahoo! Finance, Bitcoin Law states that people will be able to use bitcoin to buy goods and services “unless a business cannot provide the tech required to facilitate the transaction.” People will also be able to pay their taxes in Bitcoin. The state of El Salvador will also help educate and train Salvadorans on using bitcoin.
Although proponents of Bitcoin are excited about this massive step for digital currency, some people are not so optimistic.
Skeptics believe that Nayib Bukele is using Bitcoin Law as a sort of PR stunt to distract from allegations of authoritarianism. Other people think Bukele has pushed the bitcoin agenda to be “popular on the internet”. Which, for the record, seems to be working.
Nayib Bukele, however, seems to be nonplussed. Since Bitcoin Law passed, he has announced a plan to “mine” Bitcoin by harnessing the power of a local volcano. Just don’t ask us how that works…
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