El Salvador has become the first country to approve Bitcoin as the official currency, announced President Nayib Bukele through Twitter. The President has backed the cryptocurrency’s use in boosting the economy. He announced that people who invest Bitcoin in El Salvador will get the country citizenship. People investing three Bitcoins in country’s economy will be given citizenship by the government.
The El Salvador Congress on June 9 approved a bill making Bitcoin a legal tender in the country. The bill was passed after getting 62 out of possible 84 votes.
The price of Bitcoin was up from $33,555 to $34,398, as per CoinMarketCap, shortly after the announcement of the approval.
“The purpose of this law is to regulate Bitcoin as unrestricted legal tender with liberating power, unlimited in any transaction, and to any title that public or private natural or legal persons require carrying out,” the law reads.
Following this move, citizens of El Salvador will be able to show prices in Bitcoin. They will also be allowed to make tax contributions with the digital currency, and exchanges in Bitcoin will not be subject to capital gains tax.
“The government will guarantee the convertibility to the exact value in dollars at the moment of each transaction,” Bukele said.
Experts have said the move to bitcoin could complicate talks with the IMF, where El Salvador is seeking a more than $1 billion program.
