After Congress approved President Nayib Bukele’s proposal to adopt this cryptocurrency, El Salvador has become the first country in the world to officially adopt Bitcoin as its legal tender.

Despite concerns that El Salvador and the International Monetary Fund’s plans may be affected, out of 62 out of 84 votes, most legislators voted for an initiative to enact a law that will officially adopt Bitcoin. At 1 p.m. IST on June 9, the price of Bitcoin in India was rupee. 2.45 million.

Bukele touts the use of Bitcoin because it has the potential to help Salvadorans living abroad send money home, while also stating that the U.S. dollar will continue to be legal tender.

“This will bring financial inclusion, investment, tourism, innovation and economic development to our country,” Booker said in a tweet shortly before the Congress vote, which is controlled by his political parties and allies.

He added that the use of Bitcoin is optional and will not pose risks to users. Its use as legal tender will become law within 90 days.

“The government will guarantee that every transaction can be exchanged for the exact value of the U.S. dollar,” Booker said.

El Salvador’s dollarized economy relies heavily on money sent back by overseas workers. According to data from the World Bank, the amount of remittances to the country in 2019 was close to 6 billion U.S. dollars (approximately 437.9 billion rupees), accounting for about one-fifth of GDP, and one of the countries with the highest rate in the world.

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Experts say that the switch to Bitcoin may complicate negotiations with the International Monetary Fund, and El Salvador is seeking plans for more than $1 billion (about 730 billion rupees).

© Thomson Reuters 2021

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