Lately, IMF has also warned the country for its Bitcoin Move.
The Governor of the Bank of England Andrew Bailey stated some of his concerns about Bitcoin being a legal tender in El Salvador. Bailey speaks at a Cambridge Student Union event. He stated that the volatility of BTC is very dangerous.
“It concerns me that a country would choose it as its national currency. What would worry me most of all is, do the citizens of El Salvador understand the nature and volatility of the currency they have,” the BOE Governor said.
In September, El Salvador has authorized Bitcoin usage as legal tender in the country. Besides using the digital asset as one of the payment methods, the Central American nation also holds large amounts of Bitcoin.
Recently, El Salvador increased its Bitcoin holdings by adding 100 BTC. With this addition of 100 BTC, the country ended up with $60 million worth of BTC holdings.
Since the beginning of October, the country has increased its Bitcoin accumulation. It also introduced several initiatives to increase BTC’s adoption in the country.
BTC Strategy of El Salvador
The President of El Salvador Nayib Bukele has been criticized for his BTC strategy by leading financial organizations. Last week, IMF criticized El Salvador for its Bitcoin adoption.
“Given bitcoin’s high price volatility, its use as a legal tender entails significant risk to consumer protection, financial integrity, and financial stability. Its use also gives rise to fiscal contingent liabilities. Because of those risks, BTC should not be used as a legal tender,” IMF said.
However, Bukele insisted to believe in Bitcoin in spite of all the critiques. Even, he stated that he wants to acquire more BTC in the future.
“Bank of England is “worried” about El Salvador’s adoption of BTC? Really? I guess the Bank of England’s interest in the well-being of our people is genuine. I’m really concerned about the Bank of England printing money out of thin air,” Bukele said.