The World Bank has refused El Salvador’s request to help the Central American country’s transition to adopt Bitcoin as legal tender. El Salvador recently passed a law authorizing the world’s leading cryptocurrency bitcoin as legal tender in the country. The Central American country’s move into bitcoin received praise from the crypto community, but it did not impress global regulators. El Salvador is the first country in the world to officially recognize bitcoin as legal tender.
World Bank cites Bitcoin’s environmental and transparency shortcomings for refusing to help.
The World Bank cited issues with Bitcoin’s environmental impact and transparency as reasons why it will not support El Salvador’s move to adopt Bitcoin as an officially accepted currency. “While the government did approach us for assistance on Bitcoin, this is not something the World Bank can support given the environmental and transparency shortcomings,” a World Bank spokesperson said. However, the World Bank noted that it could help El Salvador in other ways, including “currency transparency and regulatory processes.”
Global regulators are not impressed with El Salvador’s decision.
Earlier, Salvadoran Finance Minister Alejandro Zelaya said they sought technical assistance from Banco Mundial (the World Bank). Many from the crypto community criticized World Bank’s decision to deny El Salvador’s request. While El Salvador has received praise and applauds from the crypto community, global regulators have criticized the Central American country for its move into bitcoin. Earlier, an IMF spokesperson Gerry Rice noted the adoption of Bitcoin presents many financial, legal, and macroeconomic concerns that require a “very careful analysis.” As reported earlier, economist Steve Hanke said that El Salvador using Bitcoin as a legal tender could potentially “completely collapse the economy.”