IMF’s Negative Remarks on El Salvador’s Move in Legalizing Bitcoin

  • June 13, 2021

IMF’s Negative Remarks on El Salvador’s Move in Legalizing Bitcoin

Bitcoin, in the last couple of days, El Salvador’s crypto-friendly moves have placed the country on a pedestal. The International Monetary Fund, IMF, however, wasn’t pleased at all with these decisions.

President Nayib Bukele, went all in, about the adoption of cryptocurrency. He went on to make El Salvador the first country to ever give Bitcoin a legal tender status.

With this law set, every economic representative in the country would be compelled to accept Bitcoin as payment. This law also helps in the easy transfer of compensations from Salvadorans living away from the country.

IMF views the “macroeconomics” sways of Bitcoin becoming a legal tender

In the latest press briefing, IMF’s spokesman, Gerry Rice grappled with the country’s recent move and suggested various issues for discussion. The IMF has reportedly arranged a meeting with president Bukele on Thursday to inspect the latest Bitcoin law. The country is hoping to score a massive $1 billion program from the IMF, according to Reuters.

“Adoption of bitcoin as legal tender raises several macroeconomic, financial, and legal issues that require very careful analysis. We are following developments closely, and we’ll continue our consultations with the authorities,”

Rice added.

Cryptocurrencies have always had it tough setting up a presence in the financial world. Despite officials across the globe constantly trying to regulate the market, cryptocurrencies recorded extreme growth in terms of value as well as fame. However, this wave didn’t stop financial regulators from examining the industry.

Remarking on the same, Preston Pysh, a bodacious Podcast host tweeted,

“Similar to how global central banks have incentivized citizens of the world to get in debt up to their eyeballs, the IMF does the same but for nation-states. #Bitcoin flips this incentive on its head. Watch El Salvador’s actions here…it’s going to be extremely demonstrative.”

Furthermore, with this at bay, the country has already started inquiring into inducing efficient methods of Bitcoin mining. El Salvador has been preparing to use the energy captured by volcanos for mining crypto, as long as environmental issues surround the mining industry.

Sources:

  1. https://www.imf.org/external/mmedia/view.aspx?vid=6258230460001
  2. https://twitter.com/PrestonPysh/status/1403014414366916617
  3. https://www.reuters.com/article/el-salvador-bitcoin-imf-idUSL2N2NS1PB
  4. https://www.thelivefeeds.com/imf-weighs-in-on-el-salvadors-bitcoin-legal-tender-law/
  5. https://bitcoinist.com/imf-concerned-about-el-salavadors-bitcoin-law-due-to-legal-and-economic-issues/
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