Bitcoin has become legal tender: This country suddenly announced Bitcoin as legal tender! Many central banks have left the market. How big is the impact?
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This “no-name” small country struggling with food and clothing made a big move as soon as it took action.
Bitcoin has become legal tender
Bitcoin has become legal tender announced by El Salvador. El Salvador, a coastal country in northern Central America, has announced that since September 7th, Bitcoin and the U.S. dollar have become the country’s legal tender. Now after this announcement El Salvador became the first country in the world to list Bitcoin as legal tender. And El Salvador Bitcoin law announce soon.
El Salvador became the first country in the world to list Bitcoin as legal tender.
Bitcoin will go hand-in-hand with the U.S. dollar? Supporters and critics all over the world will pay attention to the results of this unprecedented experiment.
Bitcoin turned into a country’s legal currency
On September 7, Bitcoin officially became the legal tender of a country.
On the same day, the country’s President Nayib Bukele revealed through social platforms that the country had purchased 400 bitcoins. Based on the Bitcoin price at the time of the tweet, the total amount of digital currency purchased by El Saldova is approximately US$20.9 million. After the Twitter announcement, the price of Bitcoin rose as expected. The price was approximately US$52,681.85.
Bitcoin legal countries list 2021
Bitcoin legal tender– The El Salvador has become the first country to officially list Bitcoin on its balance sheet and deposit it in its reserves.
We just bought the dip.
— Nayib Bukele 🇸🇻 (@nayibbukele) September 20, 2021
150 new coins!
El Salvador now holds 700 coins.#Bitcoin🇸🇻
In fact, as early as June of this year, this developing country with a population of less than 7 million passed a bill to approve Bitcoin as the country’s legal tender, and it came into effect 90 days later. The government expressed the hope that the passage of this bill can achieve the goals of attracting investment, facilitating the transfer of remittances, promoting financial inclusion, and strengthening currency diversification.
70% of Salvadorans disagree with the government’s decision
However, the bill did not receive widespread recognition as policy makers had hoped, and instead received a lot of criticism across the country. Since June, demonstrators protesting on the streets of the capital have continued to march. According to data released by the University of Central America, nearly 70% of Salvadorans who participated in the survey disagree with the government’s decision to use Bitcoin as legal tender. Many people also said that they don’t know how to use digital currency.
However, supporters in the country who approve of the bill say that as the acceptance of Bitcoin increases, other countries can follow suit. The above-mentioned bill also states that Bitcoin exchanges are not required to pay capital gains taxes by allowing prices to be displayed in Bitcoin and using digital currency to pay taxes.
Digital currency wallets are also online
Online payment, cross-border transfers are carried out at any time, the procedures are zero, etc., are mentioned in the official Bitcoin payment.
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Promotional video about Bitcoin payments
At the end of last month, the Salvadoran government released a promotional video about Bitcoin payments. It pointed out that the use of Bitcoin is not mandatory, and people can freely choose to use U.S. dollars or Bitcoin when making payments. In the country, cash transactions, commodity pricing, wages and pensions, etc., will continue to use U.S. dollars.
Government is installing 200 Bitcoin ATMs
On August 23, local time, Booker revealed on the social platform that the government is installing 200 Bitcoin ATMs, which will be distributed in 50 financial outlets to support citizens of the country to conduct Bitcoin and Bitcoin transactions. Conversion between U.S. dollars. At the same time, Chivo Wallet, the official cryptocurrency wallet, will be launched and used together.
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In this wallet application called Chivo Wallet, citizens can register with a national ID in order to use Bitcoin for transactions. When users register to accelerate the adoption of Bitcoin, they will receive $30 worth of Bitcoin as a small gift to incentivize consumption.
citizens can register with a national ID in order to use Bitcoin for transactions
According to foreign media reports, a quarter of Salvadoran citizens currently live overseas, mainly in the United States. These overseas workers usually send their overseas wages back to their families in China. According to data from the El Salvador Central Bank, the total remittances of the country’s diaspora reached US$5.9 billion last year.
Bitcoin to transfer money
If you use Bitcoin to transfer money, the handling fee of up to 10% per cross-border remittance is bound to be greatly saved. Some economists pointed out that the main purpose of Bitcoin in El Salvador is actually remittances, “using remittances to save some wealth, perhaps just to compete with the U.S. dollar in the country.” According to World Bank statistics, remittances account for more than 24% of El Salvador’s GDP.
New challenges in financial regulation are inevitable
What is not known to everyone is that the bill to incorporate Bitcoin into legal tender took less than a week from being proposed to being passed. The free and barbaric development of cryptocurrencies launched by global developers has indeed prompted the central banks or monetary authorities of many countries and regions around the world to vigorously promote the work of legal digital currencies.
Digital currency research
According to the latest survey report of the Bank for International Settlements, currently, about 86% of central banks in 65 countries or economies have carried out digital currency research, and the number of central banks undergoing experiments or proof-of-concept has increased from 42% in 2019 to 60% in 2020 .
According to relevant public information disclosed in the central bank’s white paper, in recent years, whether in Europe, the United States or the Asia-Pacific region, central banks in various regions have announced their considerations and plans regarding central bank digital currencies in various forms.
Bitcoin In India–
“The Central Bank of India is considering introducing centrally-backed digital currencies in phases to protect people from the impact of cryptocurrency price fluctuations.” In late July this year, T. Rabi Sankar, the deputy governor of the Bank of India, introduced the central bank’s digital currency. When the currency progressed, it said that perhaps the era of central bank digital currency (CBDC) has come.
The Central Bank of India is considering introducing centrally-backed digital currencies in phases to protect people from the impact of cryptocurrency price fluctuations.” In late July this year,
At the same time, Sankar also mentioned that the introduction of central bank digital currency may bring more efficient, more credible, more standardized, and more legal currency-based payment options, but it will undoubtedly cause related risks, and its benefits need to be greater. For careful evaluation.
Legal digital currency process
What cannot be ignored is that while the legal digital currency process is advancing, national regulations are also strengthening the suppression of private cryptocurrencies. For example, the Securities and Exchange Commission of Thailand approved a new regulation in June this year that prohibits the listing of other virtual currencies such as emoji tokens, fan tokens, and non-homogeneous tokens on local exchanges.
Central Bank of China on cryptocurrency transactions
Since the beginning of this year, the Central Bank of China has also put forward requirements on the banking industry to strengthen the supervision of cryptocurrency transactions. On July 15 this year, the cryptocurrency content community “Coin World” announced that it would stop operating apps and websites with immediate effect.
According to the announcement, in order to comply with the terms of the operation management department of the People’s Bank of China concerning the virtual currency field, and to cooperate with the regulatory authorities’ industry rectification requirements, the community APP and website ceased operations in China.
Reducing transaction costs better privacy protection
Reducing transaction costs, monitoring fund transactions, and better privacy protection under the loosely coupled account model are the obvious benefits that digital currencies can bring based on their own characteristics, but new regulatory challenges also come with opportunities. Regulators are still cautious about launching legal digital currencies.
Not long ago, the International Monetary Fund (IMF) stated that some countries choose to use cryptocurrency as their national currency, which may indeed have advantages such as security, easy access and low transaction costs, but in most cases, the risks and costs outweigh the potential benefits.
The IMF also warned that Nigeria and others should not use encrypted assets as their national currency, so as to avoid weakening the monetary policy, leading to macroeconomic instability, and making banks and other financial institutions have to face strong volatility in the cryptocurrency market.
FAQ
- Which countries will make crypto legal tender next?
- After El Salvador announcement Brazil crypto bill making.
2. Bitcoin legal tender countries.
- El Salvador the first country to announce legal tender wait and see who is next?
3. Bitcoin official currency.
- Wait and watch who offciailly announce.
4. Can Bitcoin become a legal tender?
- Yes, El Salvador already announced.
5. Which country made Bitcoin legal tender?
- El Salvador
