El Salvador president wants to make Bitcoin legal tender

Nayib Bukele

A sign of things to come? El Salvador, a small country in Central America, is leading the charge. According to President Nayib Bukele, a bill is being develop to recognize Bitcoin as legal tender.

He confirmed plans to submit the bill later this week, in a videotaped announcement shown Saturday.

An emotional Jack Mallers of Zap announced the news at the Bitcoin 2021 conference in Miami, saying that the company is working with Bukele to implement a plan. A plan that the 39-year-old president says will have short term benefits for thousands of unbanked individuals and generate jobs.

Mallers said:

“As of now, El Salvador is set to be the first bitcoin country, and the first country to make bitcoin legal tender and treat it as a world currency and have bitcoin on their reserves.”

What is not clear is what being the first Bitcoin country will mean for the fiscally unstable and oppressively poor Central American nation. Some 70% of the residents there lack a banking account, and El Salvador’s gross domestic product was around $24.6 billion in 2020.

A brief excerpt of what appeared to be the bill that Bukele is readying harped on a familiar theme that central banks are increasingly taking actions causes harm to the economic stability of El Salvador. Circulation of a digital currency with a supply that cannot be controlled, then, becomes necessary.

The bill must be reviewed by the country’s legislative assembly first.

But this should not be a problem for the populist president’s upstart political party that controls 70% of that body. Meaning, any project supported by him is likely to be fast tracked.

We’ll find out soon enough how it rolls.

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