El Salvador's historic decision to deem Bitcoin as legal tender sets a precedent for how other governments can embrace cryptocurrencies.
After over a year of basically zero in-person conferences around the globe, Bitcoin 2021 marked a huge milestone in getting "back to normal" this past weekend in Miami. A lot has changed in the blockchain sector over the past year, and a lot went down at the big event.
There was a super cringe, Bitconnect-esque moment when Max Keiser screamed, "We're not selling! F* Elon!" Meanwhile, on Crypto Twitter, the discussion centered around the appearance of Size Chad and the discovery that he's actually a real person. Those were definitely memorable events. But what was the biggest news of the weekend? That came during Jack Mallers' emotional speech at the Nakamoto stage on Saturday afternoon.
El Salvador - First Country to Deem Bitcoin As Legal Tender
Prior to Mallers' presentation, there were rumors circulating that his announcement at the end of the conference would be the biggest news in the blockchain sector in the past couple of years. The hype was certainly real in this case. With tears of joy, Mallers' played a video of El Salvador President Nayib Bukele stating that he would submit a bill to make Bitcoin legal tender in the country.
This is a big deal for several reasons.
- With the passage of this bill, El Salvador is set to become the first nation to deem Bitcoin as legal tender and will not apply capital gains taxes.
- El Salvador is likely to become the first nation to officially put Bitcoin (BTC) and/or other cryptocurrencies on its balance sheet.
- This could be the catalyst for more national or regional governments to adopt similar policies towards cryptocurrencies.
- Many governments are creating central bank digital currencies (CBDCs) as a "blockchain not bitcoin" approach, but El Salvador is showing that decentralized cryptocurrencies owned by the people should play a vital role in the future.
- We are seeing the emergence of a new wave of opportunities where smaller countries can leverage blockchain and cryptocurrencies to innovate in the 21st century. Traditionally, this wasn't possible in a world monetary policy has been dominated by a small group of superpowers and decision-makers. El Salvador plans to offer “immediate permanent residence to crypto entrepreneurs.”
- El Salvador shows nations that there is an answer to national monetary policy that doesn't involve money printing and hyperinflation.
What's Next For National Crypto Adoption?
El Salvador's adoption of cryptocurrency isn't important because of the nation's size. After all, the country only ranked 103 out of 196 countries in terms of GDP based for 2020. El Salvador's decision is crucial because it is a bold move stance. President Nayib Bukele is showing how decentralized technologies and innovations around them can be embraced and encouraged, not shunned or discounted. This decision is important because it shows that the same path is available for other nations if they choose. Most importantly, this moment at Bitcoin 2021 shows us mass adoption of crypto is much closer to reality than we originally imagined.
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