Since the 00:00 hr of September 7th, Bitcoin has become a legal currency in El Salvador. President of El Salvador Nayib Bukele announced on Monday that the country bought its first 200 bitcoin coins. For the first time in the world, a nation accepts the use of cryptocurrency. How is the day-zero of Bitcoin in El Salvador?
The acceptance of the new currency comes three months after the Legislative Assembly approved in an express format the so-called Bitcoin Law, which went ahead thanks to the vote in favor of 62 of the 84 deputies that make up the Parliament, with an official majority.
The movement has caused the nation and many other countries to debate the opportunities and dangers of cryptocurrencies.
What will happen now with Bitcoin in El Salvador?
As of this Tuesday, Salvadoran companies and businesses are obliged, as far as possible, to accept digital currencies as a form of payment.
To encourage its use in a country where the majority of the population does not have internet access, the government is inviting Salvadorans to download a new digital wallet application -the Chivo Wallet- that gives away $ 30 in bitcoins to all citizens.
“Starting tomorrow (Tuesday), users who so wish will be able to download it for free (the Chivo Wallet) from the digital stores of the Android, iOS, and Huawei operating systems,” said a statement from the presidency.
The government clarified that “the use of bitcoin is optional and no one is obliged to use it, so it must be remembered that the dollar is the reference currency for prices, wages, and the country’s accounting records.
Salvadorans against Bitcoin
The coordinator of the FMLN parliamentary group, Jaime Guevara, presented a brief to the Supreme Court of Justice (CSJ) on Monday after it did not respond to a lawsuit filed in June against the Bitcoin Law.
Óscar Artero, on behalf of social organizations and supported by Deputy Guevara, presented a lawsuit of unconstitutionality before the Chamber imposed on said regulations, considering that it was unconsulted and without representation.
On the other hand, the deputy of Vamos, Claudia Ortiz presented yesterday before the Assembly a request for the repeal of the Bitcoin Law.
The deputy also recalled that the Law was approved without any consultation, without technical studies, and without justification.
This petition joins others submitted before by other parties and organizations in the country. Among the other initiatives, there is a reform of the Labor Code in order to establish that salary payments are mandatorily denominated in dollars.
Despite the opposition, the Bitcoin law came into force.
What happens with Bitcoin?
Bitcoin plummeted to 17 percent, its lowest level in a month, amid news that El Salvador’s adoption of cryptocurrency as legal tender is faltering.
The cryptocurrency fell as low as $ 43,500 in New York on Tuesday, dropping more than 19 percent within an hour after breaking the $ 50,000 level.
However, the asset has been cutting its losses and at 2:47 p.m., Central Mexico time, it lost 9.30 percent to 46,925 dollars per unit. Meanwhile, Dash fell almost 20 percent and Ethereum lost 12 percent.
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