El Salvador proposes law to make Bitcoin legal tender

El Salvador’s President Nayib Bukele addresses Congress on Tuesday, June 1, 2021 at the Parliamentary Building in San Salvador, El Salvador. Photographer: Camilo Freedman / Bloomberg via Getty Images

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El Salvador became the first country to adopt Bitcoin as legal tender.

Members of the South American parliament voted by the “overwhelming majority” in favor of the Bitcoin law.

At the beginning of Wednesday, President Nayib Bukele sent a law to the national parliament for voting.

“The purpose of this law is to regulate Bitcoin as an unlimited fiat currency with free power, unlimited in any transaction, and to any rights that a public or private natural person or legal entity must exercise. Is to do “

Prices can be displayed in Bitcoin, tax burdens can be paid in digital currencies, and Bitcoin exchanges are not subject to capital gains tax.

Bitcoin is famous Wild price fluctuations Prompted critics to suggest it Not suitable for a valid currencyIt is still unclear how El Salvador will eventually develop Bitcoin as fiat currency.

According to the proposed law, the exchange rate with the US dollar is “freely set by the market.” The current official currency of El Salvador is the US dollar.

The law also states that the state “promotes the necessary training and mechanisms to give people access to Bitcoin trading.”

According to the Bitcoin law, about 70% of El Salvador does not have access to traditional financial services. Cryptocurrencies are seen as a way to increase financial inclusion.

This proposal must go through the El Salvador legislative process before it can be passed by law.

Bukele’s move to submit a bill to Congress last week El Salvador has partnered with digital wallet company Strike. Build the country’s modern financial infrastructure using Bitcoin technology.

During April Bitcoin According to CoinDesk data, it reached a record high of $ 64,829.14, but has since fallen by almost half. It has still increased by more than 230% in the last 12 months. The rise is due to many factors, including: Increasing interest of institutional investors Such as large companies Tesla And square Buy Bitcoin.

El Salvador proposes law to make Bitcoin legal tender

Source link El Salvador proposes law to make Bitcoin legal tender

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