The governor of the Bank of England has voiced concerns about the Central American country El Salvador choosing bitcoin as a national currency. Citing a recent warning by the International Monetary Fund (IMF) against bitcoin’s use as legal tender, the governor said: “What would worry me most of all is, do the citizens of El Salvador understand the nature and volatility of the currency they have.”
IMF is not happy that El Salvador has made BTC legal tender.
“It concerns me that a country would choose it as its national currency … What would worry me most of all is, do the citizens of El Salvador understand the nature and volatility of the currency they have,” Bank of England’s governor Bailey noted while speaking at the Cambridge University student union. Governor Bailey added that the International Monetary Fund (IMF) is not happy that El Salvador has made BTC legal tender. As reported earlier, El Salvador became the first country to pass a law making the leading cryptocurrency legal tender alongside the U.S. dollar in September.
The IMF told El Salvador that bitcoin “should not be used as a legal tender.”
As reported earlier, the IMF told El Salvador last week that bitcoin “should not be used as a legal tender.” Citing “bitcoin’s high price volatility,” the Internationa Monetary Fund stated that the use of BTC “as a legal tender entails significant risks to consumer protection, financial integrity, and financial stability.” In addition, “Its use also gives rise to fiscal contingent liabilities.” The warning came one day after El Salvador’s president, Nayib Bukele, announced a plan to build the world’s first “bitcoin city” powered by a volcano and financed by bitcoin bonds.