El Salvador president announces that the country could become the very first country to start adopting Bitcoin as some sort of legal tender. Nayib Bukele, the Salvadorian president, announced this in a video recording that was shown during the recent Bitcoin 2021 conference that was held in Miami.
El Salvador President Nayib Bukele on Cryptocurrency
According to Bitcoin Magazine, Bukele stated that next week, he will be sending a bill to congress in order to make Bitcoin a legal tender. The 39-year-old Bukele had a strong majority with 56 out of 84 seats ever since his landslide victory in the country's legislative elections that took place last March.
President Bukele shared a status that noted Bitcoin investors would start moving to El Salvador saying the country has great weather, beach front properties for sale, and even world class surfing beaches. It was also noted that the country is one of the first countries that don't have property tax.
El Salvador No Capital Gains Tax
It was also noted that the country would have no capital gains tax for Bitcoin since the cryptocurrency is said to become a legal currency. The best news is that Bitcoin investors will have immediate permanent residence for other crypto entrepreneurs.
The story by CNN notes that the country will be partnering with the digital finance company called Strike in order to establish the full logistics of this decision. Jack Mallers, Strike CEO, stated 70% of the active population still does not have a bank account and that they still aren't part of the financial system.
US Dollar and Other Currencies
The CEO said that they had asked him to help write a plan that would view Bitcoin as some sort of world-class currency and that they need to put together a certain Bitcoin plan in order to help those people. El Salvador, as of the moment, uses the United States dollar as the country's official currency.
Although different central banks around the world have already reacted to Bitcoin with fascination, they have yet been hesitant when it comes to embracing cryptocurrency due to the coins' extreme volatility. Crypto's rise in popularity, however, has led the Federal Reserve to finally look hard at the old-fashioned dollar's final limitations. This is true particularly around payments as well as money transfers that might even take days in order to accomplish.
How Bitcoin Could Help
Bitcoin transactions, however, happen almost instantaneously. Cryptocurrencies technically do not require their holders to have bank accounts. Instead, these currencies exist in digital wallets. This could also potentially help the poorer communities not just in El Salvador but also in some minority communities in the US.
Federal Reserve Board of Governors member Lael Brainard laid out a whole case last month for a more secure, central bank-backed digital currency. This could create a more efficient form of payment system and could expand the general financial services to certain Americans that have been underserved by the traditional banks.
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Written by Urian B.