El Salvador adopts Bitcoin as legal tender

Wednesday 9June was a momentous day for crypto.

El Salvador became the first country in the world to adopt Bitcoin as official legal tender.

The Legislative Assembly of El Salvador voted to pass a bill that declared Bitcoin as legal tender, as per the Communications Secretariat of the Presidency of the Republic of El Salvador, receiving 62 out of 84 votes.

As I was quoted by Forbes, Yahoo News, City AM and Verdict, amongst others, although it is the first to adopt the world’s largest cryptocurrency by market capitalisation, El Salvador certainly won’t be the last.

Several larger, more powerful countries are trying to stifle or slow down the unavoidable shift to global, digital currencies.

However, El Salvador has made history in embracing Bitcoin, recognising it as legal tender.

Other countries will follow suit. Low-income countries have long suffered from weak currencies that are particularly vulnerable to market changes, thereby triggering rampant inflation.

As a result, the majority of developing countries depend upon major ‘first-world’ currencies, such as the U.S. dollar, to complete transactions.

Though, depending on another country’s currency can lead to often very costly problems.

A stronger U.S. dollar for example will affect the economic forecasts of emerging markets, as developing countries have taken on such high dollar-denominated debt over the past few decades.

Nevertheless, by adopting a cryptocurrency, these developing nations have a currency that isn’t influenced by market conditions within their own economy, nor directly from just one other country’s economy.

Moreover, as Bitcoin operates globally, it is more broadly impacted by global economic changes.

Financial inclusion for individuals and businesses in developing countries could be bolstered due to digital currencies, as they can bypass the biases of traditional banks and other financial services providers.

Naturally, El Salvador’s move won’t be without criticism, likely from those based in wealthy countries.

Still, I think this revolutionary approach to resolving complex issues should be advocated.

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