Bitcoin Will Soon be ‘Legal Tender’ in El Salvador – Here’s What that Means
Starting today, El Salvador has become the first country to make bitcoin legal tender. The government is taking the program a step further by giving $30 USD in free bitcoins to citizens who sign up for its national digital wallet, known as Chivo. Foreigners who invest three bitcoins in the country, currently around $140,000 will be granted residency. Panama is allegedly considering following El Salvador’s lead, but will likely wait to observe how the operation works for El Salvador. Legal tender refers to money that must be accepted in offered in payment of a debt.
However, legal tender doesn’t mean all businesses, especially small businesses, have to accept it as payment for a good or service. Instead, the requirement applies only to debts owed to creditors. The ability of stores to refuse cash or other monies considered legal tender is made explicit on the treasury site. El Salvador is seeking to boost its economy through the new program, encouraging investors with cryptocurrency to spend more of it within the country. The $30 USD in bitcoin is an attempt to temporarily stimulate the economy.