August 3, 2021

World Bank says it will not help El Salvador implement bitcoin law

(CNN Español) — The Minister of Finance of El Salvador reported this Wednesday that he requested the support of the World Bank for the implementation and regulation of bitcoin as legal tender in the country. But a World Bank spokesperson told CNN that the body will not help the government of El Salvador in implementation.

“We are committed to helping El Salvador in various ways, including for exchange transparency and regulatory processes. While the government reached out to us for help with bitcoin, this is not something the World Bank can support given transparency and environmental deficiencies, ”the spokesperson said.

What was the government looking for

If the World Bank had accepted the request, it would have joined the technical advice announced on Monday by the Central American Bank for Economic Integration (CABEI) to develop the regulatory framework that allows the use of cryptocurrency, at the same time as the US dollar, to make payments and transactions.

“We have 90 days to regulate, for this to come into effect,” declared the minister at a press conference.

According to Zelaya, CABEI will finance the US $ 150 million trust to guarantee the parity of bitcoin with the dollar. “Innovation should not scare us. We must learn from it, learn to manage it and how to generate opportunities from these risks ”, said Danto Mossi, CABEI executive director, who participated virtually in the conference.

Credit: STANLEY ROAD/AFP via Getty Images

Investor interest

The government of El Salvador ensures that the approval of the bitcoin law has generated interest from international investors for public accounting and mining operations.

In fact, this Wednesday President Nayib Bukele held a meeting with a delegation of 31 investors led by Brock Pierce, presented as one of the bitcoin magnates according to information from Forbes magazine.

The private meeting was confirmed by the Communications Secretariat of the presidency. Hours after the meeting, Pierce shared photos of the meeting on his Twitter account. “It is an honor to lead this official delegation of bitcoin ambassadors in El Salvador to educate the Government on how bitcoin, blockchain and technology can create a brighter future for everyone in their nation,” the investor wrote on the social network.

Bitcoin in El Salvador is a political theater 2:40

Opponents of bitcoin

The use of cryptocurrency does not appeal to everyone. According to a survey by the Chamber of Commerce and Industry of El Salvador, 96% of those consulted said they did not agree with the forced use of bitcoin. The law approved by the legislators, in its article 7, establishes that “every economic agent must accept bitcoin as a form of payment when it is offered to him by whoever acquires a good or service.”

The survey conducted between June 11 and 15 among 1,600 people, businessmen and non-businessmen, revealed that 93.2% of those consulted said they were not interested in receiving their salaries in the new currency. Given this concern, the Minister of Finance clarified this Wednesday that salaries in private companies and the government will continue to be paid in dollars.

With information from Marlon Sorto