El Salvador’s Legislative Assembly has approved a bill allowing the establishment of a $150 million Bitcoin Trust and to promote the advancement of cryptocurrency framework and facilities across the nation. The measure was approved on August 31, with 64 lawmakers supporting the bill and 14 voting against the establishment of the trust.
The Trust is intended to ease the exchange of Bitcoin into the US dollars, as well as to fund the development of critical technical framework that will enable broad acceptance of cryptocurrencies. The announcement comes only one week before the country’s contentious Bitcoin Law goes into force.
The upcoming law would make Bitcoin legal currency across El Salvador, and it is set to go into force on September 7th. Currently, US dollars are the country’s legal currency. The Development Bank of El Salvador (Bandesal) has been tasked with overseeing the functioning of the trust.
The $150 million will come from the nation’s $500 million loan with the Central American Bank for Economic Integration (CABEI). The CABEI loan was first obtained to aid in the economic rehabilitation of small and medium-sized companies.
Of those monies, $23.3 million is set aside to assist the construction of government-aided cryptocurrency ATMs, which will enable domestic residents to trade Bitcoin for USD30 million has also been set aside to provide incentives for the use of the government’s digital wallet, Chivo.
President Nayib Bukele stated in June that the government would give out $30 in Bitcoin to each and every Salvadoran adult who downloaded the Chivo wallet. Nevertheless, El Salvador has a population of 6.5 million people, indicating that the government either thinks usage would be lower or has not allotted adequate Bitcoin to do that.
In similar story, asset tokenization and financial network firm Koibanx said today that it has secured a contract with the government of El Salvador to build the country’s crypto currency network, which will use Algorand’s open source block chain as the foundation.
El Salvador’s Bitcoin Law has received condemnation and mistrust from overseas bodies as well as its own citizens. Mara Luisa Hayém Brevé, Minister of Economy, said that the government was focusing on cryptocurrency education and utilizing cryptocurrency rewards to alleviate the great deal of uncertainty in its people.
