Thursday, February 2

IMF recommends again to El Salvador to stop considering Bitcoin as legal tender – DiarioBitcoin


For Angel Di Matteo @shadowargel

In a new report, the IMF again recommended that El Salvador retract its conversion to Bitcoin as official currency, and expressed concern about the effects that this could have in the medium / long term for the nation’s economy, especially in the face of plans to want to launch bonds based on digital currency.

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The International Monetary Fund, better known by its acronym as the IMF / IMF, again recommended that the government of El Salvador reverse its decision to grant status to Bitcoin as legal tender in the country, again highlighting the risks associated with the use of cryptocurrency.

IMF recommends El Salvador stop legally recognizing Bitcoin

The recommendation came to fruition in a new report published today through its website, where the board of directors held conversations with representatives from El Salvador to speak fairly on the subject.

In the report published by the IMF it reads:

“Since September 2021, the government has adopted Bitcoin as legal tender. However, the adoption of a cryptocurrency as legal tender carries great risks to financial and market integrity, financial stability, and consumer protection. You can also create contingent liabilities.”

Among the remarks made by the board of directors, the concern about the bonds backed by Bitcoin that the government plans to launch, which they see as a risky bet precisely because of the volatility faced by the digital currency.

reiterative posture

Although the IMF recognizes El Salvador’s efforts in economic matters and the emphasis with which they have addressed the pandemic by COVID-19, The comments of the financial entity are added to the position that it has been maintaining since last year, in which it describes making Bitcoin a legal tender as a very bad decision.

This was previously indicated in a report published in November of last year, where it emphatically stated that Bitcoin should not be used as legal tender in El Salvador, inviting the country to strengthen aspects associated with the regulation and supervision of digital currency.

In the same way, the IMF He also invited other countries not to follow the example of El Salvador, warning about the possible consequences of going down that path.

El Salvador advances with Bitcoin

Let us bear in mind that El Salvador has gone ahead with great plans to Bitcoin after the adoption of the digital currency. Among these, the intention to finance the construction of a new city called Bitcoin City, the launch of bonds based on the digital currency and the purchase of BTC to save as a reserve.

In addition, the country’s authorities are also advancing plans to carry out crypto mining activities powered by geothermal energy, which is completely renewable and conforms to the new standards that the industry is seeking.


Recommended reading


Fountain: CoinDesk, IMF report

Angel Di Matteo version / DailyBitcoin

Picture of Unsplash

WARNING: This is an informative article. DiarioBitcoin is a means of communication, it does not promote, endorse or recommend any investment in particular. It is worth noting that investments in crypto assets are not regulated in some countries. May not be suitable for retail investors as the full amount invested could be lost. Check the laws of your country before investing.





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