At the start of this month, El Salvador initiated its Bitcoin adoption program and is now the first-ever country to consider it as a legal tender, followed by a bill passed. El Salvador seems to love Bitcoin, as the country is seen to be giving out $30 worth of Bitcoin to registered civilians nationwide.
According to the Bill, the complete adoption is scheduled to start on the 7th of September this year, as El Salvador is waiting for regulatory authorities to issue guidelines regarding the operations and regulations of Bitcoin in the country. The Bill passed will also force all registered businesses to accept Bitcoin, except for those who cannot afford the proper technology to implement it. President of El Salvador stated that Bitcoin becoming a legal tender will help the country to have an impressive flexibility in payment methods, making local and international payments much easier for its citizens.
Analysis by Fitch Ratings
New York-based analytical and rating company Fitch Ratings has published a report about the adoption of Bitcoin by El Salvador. Fitch Ratings stated that the country of El Salvador is taking a big risk of the adoption of Bitcoin, which might cause their financial companies to have additional risks regarding regulations, finances, and operations.
Also read:Fitch Ratings also mentioned that the adoption of bitcoin would also give rise to the global concerns of cryptocurrency being used for illegal activities, such as money laundering and funding terrorists. El Salvador is at risk of being unintentionally getting tagged by authorities for supporting such activities. Fitch Ratings also discussed the prolonged issue of Bitcoin’s volatility, saying that El Salvador will have to face a lot of challenges when it comes to keeping Bitcoin as a store of value and using it as a legit payment method for transactions around the country.
Furthermore, Fitch Ratings stated that El Salvador would also have to face issues like minimal support from the world bank and other institutions that are not supportive of cryptocurrency trade.
Some people see this adoption as an amazing opportunity to make profitable use of crypto. Meanwhile, others from the regulatory industry and financial institutions have criticized crypto for its unstable state and other issues that might eventually hurt the country rather than increasing its value and worth.
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