- Recently, El Salvador made Bitcoin a legal tender within its borders.
- To attract global crypto firms, El Salvador exempts foreign nations from tax on Bitcoin.
- President Nayib Bukele’s legal adviser made the announcement last Friday.
El Salvador surprised the world recently when it announced the country will acknowledge Bitcoin as a legal tender. Adding more to the surprises, El Salvador also declared that it will exempt foreign investors from tax on Bitcoin profits.
According to reports, El Salvador’s goal is to attract international crypto investors and companies. President Nayib Bukele’s legal adviser, Javier Argueta, mentioned that:
If a person has assets in bitcoin and makes high profits, there will be no tax. This (is done) obviously to encourage foreign investment…there will be no taxes to pay on either the capital increase or the income.
Of course, some still find El Salvador’s decision to be concerning. However, Argueta said that if ever the value of Bitcoin were to collapse — because of its volatility — El Salvador would halt the transactions temporarily.
Furthermore, Argueta also emphasized their country’s efforts in litigating illegal activities in cryptocurrencies. He said, “We are implementing a series of recommendations from international institutions against money laundering.”
More so, the announcement highlighted that El Salvador currently holds 550 BTC, with a value standing around $24 million.
The country received a lot of support from the global community. According to reports, after El Salvador recognized Bitcoin as a legal tender, the value of Bitcoin surged correspondingly.
To conclude, the government of El Salvador says that all these actions will give Salvadorans access to banking services for the first time. Knowing this, more opportunities could open for El Salvador.