A government official stated that “if a person has assets in Bitcoin
and makes big profits, there will be no taxes.”
to live in his country to those entrepreneurs who wanted to work with cryptocurrency. Now he is going for more.
Foreign investors will be exempt from taxes on their bitcoin
earnings in El Salvador, a government legal adviser said.
Speaking to AFP news agency, Javier Argueta, legal adviser to President Nayib Bukele, said
“If a person has assets in bitcoin and makes large profits, there will be no taxes. This (is done) obviously to encourage foreign investment.”
Argueta added that the country was working with international agencies to implement compliance measures. Global bodies such as the International Monetary Fund (IMF) have highlighted traceability and the prevention of illicit financial activities as key concerns. However, it is worth noting that – in the wake of El Salvador’s adoption – the IMF, for example, has been an international body that has issued several warnings against cryptocurrency
Sea of criticism
As reported by the media, the ratification of Bitcoin as legal tender, although still in its infancy, is proving somewhat problematic for the country. There has been criticism from all sides, from the opposition party to global bodies
around the world. But the government has paid no heed and moved ahead, undeterred by this resistance.
September, with USD$30 in BTC offered for new users. The government bought 400 bitcoins to prepare for the exchange, which it has to be said is not going perfectly.
It remains to be seen how the exchange will play out in the medium to long term. Critics have listed a number of problems, with volatility being the main concern. The country’s interior ministers have drawn attention to this, saying that salary payments could be affected by volatility.
Roller coaster and litmus test
As expressed by media outlet Beincrypto, the general consensus is that El Salvador’s decision has been a rollercoaster for the country.
But at the same time, this is a groundbreaking move for Bitcoin, and many are curious to see how it will play out on such a large scale. The next 12 months will be litmus test to see how it will Bitcoin plays a role in the local economy.
There are many who have seen this Salvadoran experiment as positive. Even Edward Snowden himself, known for his leaks of classified documents, applauded El Salvador’s initiative and said that other nations that are not quick to adopt crypto will regret it. For his part, Charles Hoskinson, the creator of Cardano and CEO of IOHK, said that every country needs a Bitcoinstrategy.
But despite that support, the country’s citizens are still protesting against Bitcoin.
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