El Salvador’s Parliament on Tuesday approved the use of Bitcoin as legal tender. This decision makes this Central American nation the first country to officially recognize this cryptocurrency.
Approved by 62 out of 84 lawmakers, the “Bitcoin Law” legalizes only this crypto and not other similar virtual currencies.
Ninety days after the law is published in the Official Gazette, any natural or legal person, public or private, will be able to use Bitcoins for any type of transaction.
The U.S. dollar-Bitcoin exchange rate will be freely established by the market and the use of this crypto will not be subject to capital gains tax.
All economic agents shall accept it as a form of payment in transactions of goods and services. For that to be possible, the Salvadoran state will create the necessary institutional structure for the circulation of this cryptocurrency.
“The Bitcoin Law is ambitious but simple. It has been structured to have zero risks for those who do not want to take risks,” President Nayib Bukele tweeted, adding that his administration will guarantee the “automatic and instant convertibility” of Bitcoins to dollars.
This crypto “will bring financial inclusion, investment, tourism, innovation, and economic development for our country… let no one tell us that we are too small to be big,” he added.