El Salvador will begin to accept the cryptocurrency as legal tender alongside the US dollar on September 7. However, there is still some skepticism.
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Bitcoin will become legal tender in El Salvador on September 7.Bitcoin will become legal tender in El Salvador on September 7.
El Salvador became in June this year the first country in the world to pass a law to make Bitcoin legal tender. The new regulation aims to come into force next September 7, but not everyone accepts this decision.
Over the last few days, a large crowd of Salvadorans have taken to the streets to protest against the speed with which this measure has been accepted. According to the new law, the popular cryptocurrency will have the same validity as the US dollar, however, some show skepticism towards this initiative.
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To date, the official U.S. currency. This currency has proven for decades that it is stable. However, Bitcoin is known for its ups and downs in the market, therefore, the citizens of El Salvador do not fully trust this regulation.
Bitcoin is characterized by its enormous volatility and the possibility of money laundering. These two peculiarities of the digital currency mean that Salvadorans do not fully trust the government’s decision to make it official.
According to the president of El Salvador, Nayib Bukele, this measure will facilitate remittance payments by Salvadorans living abroad and sending money to their relatives. However, some international players such as the International Monetary Fund consider that this new law will be counterproductive.
The cryptocurrency is constantly changing in value. This situation causes the unknown of how much a Salvadoran’s Bitcoin savings will be worth in a few years. Digital money can multiply or shrink just as easily.
Bukele showed images of the government’s cryptocurrency application.
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For the time being, the government of El Salvador has created a $150 million fund as a security measure and to guarantee convertibility. In addition, Bukele affirms that the US dollar will remain the national currency alongside Bitcoin.
On the other hand, as far as money laundering is concerned, it is worth noting that cryptocurrency is easier to launder without raising suspicions. This is because when the money is digitized it is practically anonymous and it is complicated to trace who is behind it.