By Alicia Maher
The world governing body on financial matters (the IMF) recently issued a report and made some recommendations regarding El Salvador’s BTC adoption. However, the central American country has vowed never to implement the IMF’s recommendations.
No Organization Can Strong-Arm Us Against Our Will
While answering questions from media reports, Alejandro Zelaya (the nation’s minister for treasury matters) stated that “no agency whether international or local has the right to tell us how we should run our country.” he further stated that “we are an independent nation and we can make independent decisions as it suits our country’s citizens.”
Early last week, the IMF issued a report recommending that El Salvador stop its BTC trust fund program and return the funds it has yet to use into the country’s financial coffers. The international financial watchdog stated that its recommendations are to help El Salvador avoid the woes that come with the huge fluctuation of the crypto market. Also, it will help fraudsters from using BTC for criminal intents in the country.
The IMF’s Suggestion
Within the past 90 days, BTC’s price has dipped by nearly 55% from its peak price, which according to the IMF, is one reason El Salvador needs to reverse its decision to adopt BTC as a legal tender. Commenting on these suggestions from the IMF, Zelaya noted that the government has anti-money laundering policies to check the activities of criminals attempting to use BTC for illicit purposes.
The IMF also suggested that El Salvador should stop giving free $30 to citizens using its Chivo wallet for the first time. The agency opined that the Chivo wallet’s potential is best optimized through the USD and not BTC.
“Over the short-term, the cost of running the Chivo wallet and execution of the BTC policy will far outweigh any possible benefits,” part of the IMF report revealed. Reacting to this suggestion, the government of the Central American nation stated that there had been a considerable improvement in financial inclusion following the launch of the Chivo wallet.
It also claimed that this BTC policy had positively impacted the nation’s tourist sector. But, the government’s statement acknowledged that there have to be improvements regarding customer protection, and the government is already working towards that goal.
BTC Price Will Increase Colossally – Nayib Bukele
As the back and forth between El Salvador and the IMF continues, El Salvador’s president tweeted that BTC’s massive price increase is inevitable and might happen sooner than expected. Bukele was so bullish about the leading cryptocurrency that he pushed for its adoption as a legal tender in his country.
“If each of the 50 million millionaires decides to own 1 BTC, there won’t be enough for each of them since there can only be 21 million BTC in circulation. Hence, it is only a matter of time before the price of one BTC increases to be worth millions of us dollars.”
After being the first nation to adopt BTC as a legal tender last year, El Salvador has purchased BTC and continues to increase its BTC holdings. Besides purchasing BTC, El Salvador is also planning to establish a BTC hub.