Last week was a historic moment in the crypto industry. El Salvador became the first country to accept Bitcoin as legal tender. The #BitcoinLaw was passed in El Salvador with 62 votes out of 84. This means that no one in the country has the right to refuse BTC as a means of payment.
A few days later, the president of El Salvador, Nayib Bukele announced that workers in the country had dug a well that could produce 95MW of energy to be used in a 100% clean mining farm for Bitcoin. This recent news has seen a lot of experts seeing a bright future for the country.
However, El Salvador’s decision to use Bitcoin as legal tender will not have any economic impact, according to JPMorgan Chase. After El Salvador adopted Bitcoin as legal tender, Wall Street giant JPMorgan Chase appeared dissatisfied with the decision made.
JPMorgan Comments on Bitcoin Move by El Salvador
In a recent report to investors tweeted by Financial Times reporter Robin Wigglesworth, JPMorgan Chase commented that El Salvador’s latest move to make Bitcoin legal tender was growth-oriented. However, the U.S. investment bank appears to be implying that the country’s decision has no economic interest. JP Morgan added that it could impede negotiations with the International Monetary Fund (IMF).
“It is difficult to see any tangible economic benefits associated with adopting bitcoin as a second form of legal tender and it may imperil negotiations with the IMF.”
The International Monetary Fund commented on El Salvador’s legalization of Bitcoin. IMF spokesman Gery Rice said the country’s decision had economic and legal problems.
“Adoption of bitcoin as legal tender raises several macroeconomic, financial, and legal issues that require very careful analysis. We are following developments closely, and we’ll continue our consultations with the authorities.”
JPMorgan Chase went on to explain that El Salvador’s decision could affect the way larger countries deal with Bitcoin.
“The question remains whether the designation of bitcoin as legal tender by a widely-recognized sovereign nation has mechanical implications for its treatment in much larger economies under the tax law, banking and financial regulations, and other areas.”
El Salvador’s move to legalize Bitcoin has received strong support from the cryptocurrency community. However, this move continues to be questioned. Only time will tell if these concerns are valid.