Saturday, May 21, 2022

El Salvador To Introduce Bitcoin Trust Worth $150 Million

El Salvador’s Legislative Assembly, on August 31, passed a new bill for creating a Bitcoin Trust worth $150 million, according to a report.

It has been further reported that 64 members of the legislative assembly cast their vote in favor of the bill, while 14 members opposed it. The main purpose of creating a Trust Fund would be to convert Bitcoin to US Dollars and support the development of crypto infrastructure across the country. 

The Legislative Assembly has given the approval for creating Bitcoin Trust just a week before the government is going to implement the controversial Bitcoin Law in the country. 

After the imposition of Bitcoin Law on September 07, BTC will be recognized as a legal tender across El Salvador.

The Bitcoin Trust will be created using the funds from the country’s $500 million loans with the Central American Bank for Economic Integration (CABEI). It would then be operated by the Development Bank of El Salvador. 

Notably, the country originally took the loan from CABEI for the economic recovery of small and medium-sized businesses.

Out of $150 million, the government has decided to use $23.3 million for installing Bitcoin ATMs. It further allocated $30 million as an incentive, which would be used to promote the usage of Bitcoin across the country. 

In June, Nayib Bukele, the President of El Salvador, announced that all those citizens, who have downloaded Chivo wallet, would be receiving Bitcoin worth $30 to their address. 

Presently, the total population of El Salvador is 6.5 million, which suggests that the government either believes the crypto adoption in the country is lower, or it has not distributed enough Bitcoins in the country.

It has been reported today that Koibanx, asset tokenization and financial infrastructure company, has collaborated with the government of El Salvador to build a digital currency infrastructure of the country. 

Koibanx, in its announcement, has mentioned that it would be using Algorand’s open-source blockchain at the core to develop the crypto infrastructure.

Since the day, El Salvador has announced to accept Bitcoin as a legal tender, it received a lot of criticism from international organizations as well as its citizens.

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