So Crypto Cannot Be A Legal Tender
You wake up in the morning and see the IMF becomes a big fan of crypto. Maybe you are still sleeping and that's a dream. The International Monetary Fund (IMF) will always hold its position as an anti-crypto. It is normal you will not hear anything positive about crypto from the IMF.
They think no cryptocurrency should be an official and legal tender. The crypto community reacted in different ways because of their stance. Someone compared it with the fax machine and email. The fax machine can complain and say email is not legal. It will not stop email to do its thing.
When El Salvador made the brave move to accept Bitcoin as legal tender, the IMF raised questions about it. They are worried about El Salvador's exposure to Bitcoin and suggested considering it carefully before making more exposure to Bitcoin.
I think the stance against crypto is about the power and control that they have built for a long time. Crypto gives people freedom and control. The powerful centralized authority will not let go of its power and control easily. I will not be surprised to see more action against crypto.
Crypto did not bring the financial crisis in 2008. The existing financial system was messed up back then. While talking about financial stability, those powerful centralized entities point their fingers at crypto as if cryptocurrency is the root of all evil.
We have crypto and I do think that's a blessing. You can build your wealth outside of the existing financial system. You hold your cryptos in your wallet. The most powerful thing is, you have the private key and no one can take your crypto assets away from you.
When countries realize what crypto can do for them, make Bitcoin legal tender, and embrace crypto, you cannot expect those centralized entities to support that. Crypto will make its own way to going forward. Do you think innovation and development will be stopped in the crypto industry?
No matter what they do to make the distance, the distance will reduce and people will keep embracing crypto in their life. Holding crypto will become a common thing like having houses, lands, and other assets.
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Reference: 1.
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It was definitely easier for El Salvador to adopt Bitcoin, given that they don't have their own national currency to protect. They were only using the US dollar before, and they understand the dollar's future ain't bright.
From that point, it got easier to make the decision. Still, I think that's really a brave step.
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I don't really know if making BTC legal tender really did anything because BTC does not help spur economic development. It incentivizes saving things because it will be worth more in the future. It does help adoption and I do think we need people to move away from the current system.
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It has increased tourism and foreign investment from crypto investors.
Yes, but I don't see it increasing that much more for other countries if they are the 2nd or 3rd. I don't know if there is enough big players to spread out that much funds once the countries grow large enough. I just don't think BTC itself was a good choice for legal tender.
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St. Kitts is looking into making Bitcoin Cash legal tender, so we'll see... I expect lots of countries, states and cities to adopt cryptocurrencies other than Bitcoin.
Doing something like this gives El Salvador a new look. I think people think about their country differently. In long run, Bitcoin shows how valuable it is and the country would definitely be benefited from that.
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