The Central American Bank for Economic Integration is optimistic about Bukele’s Bitcoin
bid and believes it can be the basis for its implementation in other countries.
Central American countries are waiting to see if El Salvador’s adoption of Bitcoin as a parallel legal tender reduces the cost of remittances, an important source of income for millions of people, said the Central American Bank for Economic Integration, the region’s development bank. Reuters
Congress approved by supermajority in June the Bitcoin Law
, proposed by President Nayib Bukele himself, which gives the cryptocurrency the status of an official currency alongside the U.S. dollar. This is a world first. The measure goes into effect in September.
Bukele has touted the adoption of BTC as a way to facilitate remittance payments for Salvadorans living abroad.
“The whole world is watching if El Salvador does well and if, for example, the cost of remittances goes down substantially … other countries will probably look for that advantage and adopt it,” Dante Mossi, executive president of the Central American Bank for Economic Integration (CABEI), told Reuters
Mossi called the plan an “out-of-this-world experiment
” aimed at increasing financial inclusion in a region where many people lack access to bank accounts or credit cards and rely on money sent home by relatives living in the United States.
CABEI is providing technical assistance to El Salvador for the implementation of the cryptocurrency. CABEI chief investment officer Carlos Sanchez said the bank’s technical assistance is focused on helping El Salvador design a legal framework for Bitcoin
adoption and ensuring that strict international money laundering protocols are met.
“The assistance is aimed at helping El Salvador navigate waters that have not yet been explored,”
It’s worth noting that this is an important show of support, as neither the World Bank. nor the <a href=”https://www.diariobitcoin.com/criptomonedas/fmi-vuelve-a-advertir-contra-adopcion-de-cripto-como-moneda-
de-curso-legal/”>International Monetary Fund wanted to support El Salvador’s decision under different excuses, even making serious warnings. In fact, Moody’s rating agency downgraded the country, considering it higher risk.
Other countries that stand to gain from adopting
The Central American bank, however, has a different position. Mossi said that Central American nations that receive the most remittances are the most likely to favor the use of Bitcoin and stressed that CABEI has a “fiduciary obligation” to support El Salvador in its request for assistance.
“Guatemala, Honduras and El Salvador are the countries that would gain the most if Bitcoin adoption reduced the cost of sending remittances,” said Mossi.
CABEI participated in a recent meeting of the Central American Monetary Council, part of the Central American Integration System (SICA), where participants inquired about El Salvador’s plans and showed interest, he added. Bitcoin El Salvador’s plans and showed interest, he added.
The Central Bank of Honduras referred Reuters to a June 11 statement that said the bank does not prohibit, supervise or guarantee the use of cryptocurrencies as payment methods in the country.
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