El Salvador has become the first country to adopt bitcoin as legal tender. Officials in the Salvadoran congress voted in a “supermajority” of 62 out of 84 votes. This fulfills president Nayib Bukele’s promise to make bitcoin legal tender alongside the US dollar.
“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. Furthermore, the law enables prices to be shown in bitcoin. Taxes can now be paid in bitcoin, and exchanges in bitcoin are exempt from capital gains tax. The government will also be partnering with digital wallet firm Strike to provide an easy and simple to use financial framework based around the cryptocurrency. Jack Mallers, founder of strike, claims that adopting bitcoin could help countries like El Salvador avoid some of the pitfalls of traditional fiat currency, such as excessive hyperinflation, that developing economies are sometimes prone to.
This decision is unprecedented, as no country has yet …