Bitcoin Legalization Risks
Friday, June 11, 2021
Following the approval of the Bitcoin Law in El Salvador by the members of the Legislative Assembly, which creates a legal framework that recognizes this digital currency as legal tender in the country, the IMF warns that financial and legal risks have arisen.
With the approval of the Law, the State will guarantee, through the creation of a trust in the Development Bank of El Salvador (BANDESAL), the automatic exchangeability of bitcoin to dollars. The exchange value of this cryptocurrency to dollar will be established by the market, according to the Law.

The news has not been well received by all sectors, since for the International Monetary Fund (IMF) this decision generates risks for the economy.

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Gerry Rice, IMF spokesman, told that "... the adoption of bitcoin as legal tender raises a number of macroeconomic, financial and legal issues that require very careful analysis. We are therefore closely following developments and will continue our consultations with the authorities."

The article adds that "... the price of bonds showed declines in the day on Monday, June 7 after it became known that El Salvador would seek to adopt bitcoin as a currency of course and would coexist with the dollar. This provision was approved at midnight on Tuesday and Wednesday, without study and consultations with experts, by the deputies of the Legislative Assembly."

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