The International Monetary Fund (IMF) has warned of “a number of macroeconomic, financial and legal issues” surrounding El Salvador that make bitcoin legal tender. “Crypto assets can pose significant risks and effective regulatory measures are essential when dealing with them,” an IMF spokesperson warned.
IMF Sees Problems With Bitcoin Being Legal in El Salvador
The International Monetary Fund (IMF) raised a number of economic and legal issues on Thursday regarding El Salvador making bitcoin legal tender, on an equal footing with the US dollar. With the recent approval of the “Bitcoin Law” proposed by President Nayib Bukele, El Salvador has become the first country in the world to adopt bitcoin as a legal tender.
Gerry Rice, a spokesman for the IMF, said at a press conference scheduled in Washington:
The adoption of bitcoin as a legal tender raises a number of macroeconomic, financial and legal issues that require very careful analysis so we are following developments closely and will continue our consultations with the authorities. Crypto assets can pose significant risks and effective regulatory measures are essential when dealing with them.
The spokesman added that the IMF will meet with President Bukele on Thursday to discuss the recently passed bitcoin law. El Salvador has been in discussions with the IMF to seek a loan of nearly $1 billion.
Following the adoption of a bill to make bitcoin legal tender, El Salvador announced that it would mine bitcoin using energy from a volcano. “I just instructed the president of La Geo (our state-owned geothermal power company) to come up with a plan to offer bitcoin mining facilities very cheaply, 100% clean, 100% renewable, 0 emission energy from our volcano. It will develop rapidly,” said President Bukele.