Bitcoin

Will volcano bonds backed by bitcoin mining be enough to fend off the IMF?


savior Passed successfully A bill would make bitcoin legal tender this week, putting it on par with the country’s official national currency, the US dollar.

While this was celebrated as Bitcoin’s victory, International Monetary Fund Since then, the International Monetary Fund (IMF) has expressed concerns about the move. International Monetary Fund spokesman, Jerry Rice, said during a press conference on the subject:

“The adoption of bitcoin as a legal currency raises a number of macroeconomic, financial and legal issues that require very careful analysis.

We are following developments closely and will continue our consultations with the authorities.”

The IMF does not approve of the sovereign adoption of Bitcoin in El Salvador

El Salvador quickly moved from announcing its intention to adopt Bitcoin to congressional debates and then passing the proposal into law.

President Neb Bukele spoke about the economic benefits of bitcoin, particularly in helping Salvadorans living abroad send remittances home.

However, the International Monetary Fund and foreign investors Do not look positively in this step.

El Salvador now negotiation With the International Monetary Fund a $1 billion financing program to plug budget gaps until 2023. This is in addition to a $389 million loan received last month as a coronavirus relief payment.

The billion-dollar program was already in jeopardy after the country’s attorney general and several top judges were ousted. But the legalization of bitcoin casts more doubt on the deal.

Last month, the Salvadoran Congress voted Removal The Attorney General, Attorney General Raul Melara, and five Supreme Court justices.

The US authorities have expressed concern, as they consider Melara among the few who keep President Bukele and his party under control of corruption. Tweet from President Bukele Addressing the international community as follows:

“We want to work with you, trade, travel, get to know each other, and help wherever we can. Our doors are more open than ever. But with all due respect: we’re cleaning our house…and that’s none of your business.”

The coding community responds

Social media comments on this issue include points like El Salvador should be Free To decide its own monetary policy, claims Revolution The International Monetary Fund does this to protect the power of its influence.

On the issue of El Salvador’s budget deficit of $1 billion, Max Keizer He brought up the idea of ​​the Bitcoin community raising and lending funds to a Central American country.

I am sure #bitcoins A temporary gap could be arranged to facilitate $1 billion in lending to El Salvador. The IMF can go by itself.”

kaiser He later tweeted about the idea of ​​a “Bitcoin Mining-Backed Volcano Bond” (BMBVB). Exact details about this are scarce at the moment. But presumably, as the name suggests, it will be supported by revenue generated from volcanic-powered mining networks.

President Bukele He said he spoke with the country’s geothermal company yesterday to work on volcano-powered bitcoin mining.

Source: BTCUSD on TradingView.com





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