When Bitcoin was created in 2008, nobody believed that it can see the light of the day. More than a decade later, this cryptocurrency is one of the top trending news in the global financial industry. Its network counts 5 million users today and it is accepted as a payment method by many of the world’s greatest brands, including Expedia, Starbucks, Shopify, Overstock, and Microsoft.
Apart from the institutional interest, one latest development managed to pave the way for Bitcoin’s future. Recently, El Salvador became the world’s first country to legalise Bitcoin. This is massive news for all traders from this country, but also for people that want to use Bitcoin as a payment method.
This is exactly the topic that we wanted to discuss. We are going to take a look at why did El Salvador legalise Bitcoin, even though it is contradictive with their IMF agreement. Let’s start.
The Reason For Bitcoin Becoming Legal
We are sure that you are familiar with this fact, but El Salvador is a country that does not have its own currency. This was a massive problem throughout the years as there are numerous Salvadorans that work abroad and they were unable to send their friends and family money. Yes, they used international exchanges, but they came with a lot of fees.
The president of El Salvador, Nayib Bukele, passed the notion to Congress, and since 62 out of 84 members voted in favour of legalising it, the law was passed with ease. Now, Salvadorans can rest assured knowing that they can legally use this cryptocurrency for payments and for making a profit.
The profit remains the number one reason why so many people register to Bitcoin’s network. They use the advanced services of trading sites to sell this asset and make a profit. Some reputable trading sites, such as Bitcoin Equaliser even allow registered traders from El Salvador to use their AI system and thus, maximise their revenue.
This AI system collects all relevant data concerning Bitcoin from the market and is able to make accurate predictions on its future price. Now, this system does not guarantee traders a profit, but it certainly increases the chances of one.
As for sending money back to El Salvador, Salvadorans that use Bitcoin to make online transactions will be able to send money instantly and without paying any fees. The government of El Salvador is fully aware of this fact and they know how helpful Bitcoin can be for its residents, which is why they legalised it.
The Problem with the IMF
While El Salvador made it easier for its residents to receive and send money, they are now facing a problem with the International Monetary Fund (IMF). The IMF is an open ‘enemy’ of Bitcoin as the Fund does not recognise it as a currency.
Here’s where the problem lies. Recently, El Salvador asked for more than $1 billion from the IMF for a certain program. Now that the country has legalised something that the IMF is openly against it, there may be complications receiving that money.
However, the president doesn’t seem too concerned as he says that the legalisation of Bitcoin has nothing to do with the IMF program and that the money will come in soon.
Will Other Countries legalise Bitcoin?
As of right now, no other country is close to legalising Bitcoin. That is due to the fact that Bitcoin cannot be controlled by banks and governments, hence they consider it an enemy. But, there’s no denying the fact that the recent events in El Salvador were a major step forward as the chances of Bitcoin becoming a globally accepted currency increase.