El Salvador is the world’s first country to recognize Bitcoin as legal money, making it the first in the world to do so.
Despite criticism from some local groups, the government believes that bitcoin will be a net good for the economy and society as a result of its implementation.
President Nayib Bukele of El Salvador stated on Monday that his government has purchased its first 200 Bitcoin (BTC) ahead of the Sept. 7 implementation of a new law that will make the cryptocurrency legal tender in the country.
According to Bukele, as the deadline for completely implementing the new BTC regulations approaches on September 7th, “our brokers will be purchasing significantly more.”
El Salvador has just bought it’s first 200 coins.
Our brokers will be buying a lot more as the deadline approaches.#BitcoinDay #BTC— Nayib Bukele (@nayibbukele) September 6, 2021
El Salvador’s Congress approved a new $150 million Bitcoin fund just last week, and the acquisition is part of that budget. As a result, this fund will be utilized to ease the conversion of Bitcoins into United States dollars in the run-up to the new law being effective.
At the current exchange rate, the BTC purchase was worth slightly more than $10.36 million.
El Salvador became the world’s first country to recognize Bitcoin as legal cash in June of this year, making it the first country in the world to do so. A number of critics, including representatives from the World Bank and the International Monetary Fund, have expressed concern about the new plan, despite widespread support from the Bitcoin community.
More recently, internal opposition has resulted in hundreds of thousands of people protesting across the country against the new Bitcoin Law.
Meanwhile, Bank of America previously stated that accepting Bitcoin in El Salvador could have at least four advantages over other countries. As stated in a research issued in July, the acceptance of Bitcoin by the country would expedite remittances, encourage financial digitization, allow greater consumer choice, and open the country to global investors.
The new Bitcoin Law allows Salvadorans to hold the digital currency as part of a long-term investment strategy, or to withdraw it in cash from any of the 200 ATMs that have been built throughout the country as a result of the new law.
The country is also putting in place infrastructure to accommodate a Bitcoin wallet issued by the government, known as Chivo. The Chivo wallet will be equipped with its own ATM, which will allow citizens to withdraw cash at any time of day or night without having to pay commissions.