El Salvador’s authorities took such a step to make it easier for citizens of the country living abroad to transfer funds to their homeland.
Bitcoin became the legal tender in El Salvador, the relevant law was approved by the country’s parliament. To create an infrastructure for payments in cryptocurrency, 90 days are allotted.
According to the adopted law, bitcoin will be used in the country as the official currency along with the US dollar. As the document says, the type of exchange between bitcoin and the dollar will be dictated by the market, all prices can be expressed in bitcoins, and all taxes can be paid with this currency.
“Any economic agent must accept bitcoin as a means of payment when it is offered as payment for goods and services,” the document on the recognition of Bitcoin as the state currency says. They will also use cryptocurrency to pay taxes. El Salvador’s authorities guarantee an instant conversion of Bitcoin to the US dollar, which will remain the base currency. To do this, the authorities will create a 150 million trust fund to buy cryptocurrency from the public.
President Bukele hopes Bitcoin’s official status will help Salvadorans who work abroad send money home.
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