Legislative Assembly of El Salvador approves $150M Bitcoin Trust. In other words, The Legislative Assembly of El Salvador approved an enactment of a $ 150M dollar Bitcoin Trust to support the nationwide development of the crypto industry.
On Aug. 31 the assembly approved the legislation. Moreover, 64 members voted for it, while 14 members voted against it. Precisely, the trust is to facilitate the conversion of BTC into US dollars. As well, to encourage the deployment of essential related technologies enabling diffuse adoption of cryptos.
The Legislation will consider BTC as Legal Tender
The legislation will consider BTC as legal tender across El Salvador. Furthermore, it will be effective on Sep. 7th. Presently, US Dollar is an official currency in the country. In addition, The Development Bank of El Salvador (Bandesal) is responsible for managing the trust.
The $150M will be taken from the country’s $500 loan with the Central American Bank for Economic Integration (CABEI). On the other hand, the main purpose of the $500M loan was to enhance the economic revival for small and medium-sized businesses.
An allocation of $23M of the fund is to support the installation of the government-powered ATMs, enabling local citizens to exchange between BTC and US dollars. Another $30M has been assigned to promote the adoption of the Government’s digital wallet, Chivo.
In June, President Nayib Bukele announced that the government would give away $30 worth of bitcoins to every citizen who downloads the Chivo wallet. The current population of El Salvador is 6.5 million, so either the government has underestimated adoption or it hasn’t allocated enough Bitcoins to accommodate everyone.
Relatively, Koibanx, a company that tokenizes assets and provides financial infrastructure, disclosed their agreement with the government to help El Salvador build its digital currency infrastructure on Algoland’s open-source blockchain.
Nonetheless, some international organizations significantly criticized the new legislation. However, Minister of Economy, María Luisa Hayém Brevé stated that the government concentrates on educating the public about cryptocurrency. As well, using cryptocurrency incentives as an approach to ease the level of uncertainty within its population.