A majority of 62 of the 84 lawmakers approved the bill, which was proposed by President Buckel last week.
Salvador has confirmed suggestion: President Naib Bukel passed a law legalizing Bitcoin, making the Central American nation the first in the world.
A majority of lawmakers voted in favor of the initiative late Tuesday night to pass a law that would formally introduce cryptocurrency, despite fears of a possible impact on Salvador’s plan with the International Monetary Fund.
“The #Bitcoin law was simply approved by a qualified majority,” President Nayeb Bukele tweeted after the vote in the assembly.
– Legislative Assembly (@AsambleSV) June 9, 2021
Translation: The legislative plenary session with 62 votes is approved by # LeyBitcoin [that allows] El Salvador will accept #Bitcoin as the legal tender. #Tewewassemble continues to make history! says a tweet from the Legislative Assembly.
Bukele argues that the use of Bitcoin has the potential to send money back home for its potential to transfer El Salvadorians abroad, while saying that the US dollar will continue to be a legal means.
“It will bring financial inclusion, investment, tourism, innovation and economic development to our country,” Buckle tweeted shortly before the vote.
He added that the use of Bitcoin, which will be used at will, will not pose a risk to users. Its use as a legal remedy will take effect within 90 days.
“The government will guarantee accurate dollar convertibility at every transaction,” Bookel said.
El Salvador’s dollar economy is largely based on remittances from citizens working abroad.
Data from the World Bank show that remittances to Armenia amounted to almost $ 6 billion, about a fifth of GDP in 2019, which is one of the highest rates in the world.
Experts note that the transfer of Bitcoin could complicate negotiations with the IMF, where El Salvador is looking for more than $ 1 billion.
Alina Carrara, head of the International Monetary Fund’s mission in El Salvador, said late Monday that the fund was “following the news and will have more information as we continue our consultations with the authorities.”
Carlos de Susa, portfolio manager at Vontobel Asset Management, said Bitcoin’s push seemed reckless as Bukele shot itself in the foot, making tax revenue collection more difficult.
“Cryptocurrencies are generally a very easy way to avoid taxation, a very easy way to simply avoid the authorities, because it is a completely decentralized system, you can launder money, you can avoid taxes, etc.,” he said.
Cry is the currency digital money which can be used to pay online for some transactions.
As in the case of “real” currencies, one, 10 or millions of Bitcoins can be owned. Unlike real currencies, cryptocurrencies exist only online and are not supported by any government or central bank.
Cryptographic: devotees say Currencies represent the economy of the future. But in the end, their value depends on their limited supply and the number of people pursuing them.
According to CoinMarketCap, the cryptocurrency market grew by more than $ 2.5 trillion in mid-May last year due to the interest of more serious investors in moving from Wall Street to Silicon Valley.
But the volatility currency, currently priced at $ 36,127, and its murky legal status have raised questions about when it can replace the fiat currency in day-to-day transactions.