One big step for Bitcoin: Bitcoin legalization in El Salvador
On June 9th, Beijing time, President Nayib Bukele of El Salvador announced that the "Bitcoin Law" written by him had been approved by the vast majority of members of the El Salvador Congress, which means that the bill will take effect in 90 days, and Bitcoin will Become the legal tender of the country.
The specific content of the "Bitcoin Law" has a total of 16 articles, of which I think the more worthy of taste are the following:
Article 2, the exchange rate between Bitcoin and the US dollar, will be freely determined by the market.
Article 3, the price can be priced in Bitcoin.
Article 6. For accounting purposes, US dollars will be used as the reference currency.
Article 7, All economic agents must accept Bitcoin as payment, whether for goods or services.
Article 13, All debts denominated in U.S. dollars that existed before the effective date of this law may be paid in Bitcoin.
These terms have properly promoted Bitcoin to the status of national legal tender.
If the disintegration of the Bretton Woods system in the 1970s announced that mankind abandoned gold and entered the era of credit currency, then 90 days later, mankind will once again try to enter the era of non-credit currency and return to the "gold standard", but this time the "gold" that humans try is not gold but It's bitcoin.
for example:
for example:
Internationally, after Bitcoin has obtained national legal status, Bitcoin needs to be regarded as a "foreign currency" in accordance with international financial reporting standards (IFRS, US GAAP, etc.).
Traditional commercial banks may need to treat Bitcoin like any country's legal tender.
More importantly, it will also trigger a global discussion on legal tender and digital currency.
For this bold attempt of El Salvador, some other countries have already begun to try to emulate and follow. So far, Latin American politicians from seven countries have expressed interest in bitcoin. Among them, Gabriel Silva, a member of the Panamanian Congress, stated that "this is very important and Panama cannot be left behind. If we want to become a true technology and entrepreneurial center, we must support cryptocurrencies."
Some people may think that a country like El Salvador is just a small country, and wonder how big a role they can play? It is also reminded that El Salvador's move may even be suppressed by other major countries and the international community. But let's not forget that when Bitcoin was first born, it was just a toy in the hands of a group of geeks. How much impact could it have at that time? Don't forget how much Bitcoin has been suppressed in the process of growing up.
Any great cause always starts from the first step, and any great change is always torn from an inconspicuous crack. Bitcoin and even digital currency have shaken legal currency and subverted human society. I think today is really a big opening.
About 1 or 2 months ago, I wrote something like this in an article: The important driver of the current round of Bitcoin bull market is institutional investors, and the important driver of the next round of bull market may be national capital, that is, Bitcoin like Gold is regarded as a reserve asset by the country.
Although Singapore’s national capital has already invested in and held Bitcoin in this round of bull market, which is regarded as the intervention of national capital, I have always estimated that the large-scale intervention of national capital will be in the next round, that is, 4 years later. When Bitcoin becomes the nation's reserve asset, it's on par with gold.
But in any case, I can't imagine that Bitcoin has become the legal currency of a country just one or two months after I wrote the article, which is a more important status than reserve assets. In a way, this means that Bitcoin's status has surpassed that of gold.
I always emphasize that the field of digital currency is an extremely magical and imaginative world, and there will always be unexpected miracles happening here. This time, I was shocked by a miracle again.
In this round of bull market, people often talk about two topics: one is when the market value of Bitcoin will surpass that of gold, and the other is when the market value of Ethereum will surpass that of Bitcoin.
Regarding the second topic, there was a very detailed article stating that Ethereum has surpassed Bitcoin in all aspects, and now it only needs to catch up with the market value.
As for the first topic, today we can say that Bitcoin has completely surpassed gold in terms of political status, and now it is only short of catching up with the market value.
Thinking of this, I can't help but have this question in my heart: In the second half of this bull market, can we see both of these catch-ups become reality at the same time?
