Web2 and Web3 are two different generations of the World Wide Web. While Web2 is a centralized platform, Web3 is decentralized and powered by blockchain technology. The success of Web3 has been enormous, with many people now moving from Web2 to take advantage of its benefits. However, the path to Web3 is not always straightforward. It is complicated and requires a deep understanding of both technologies. Today's guide will ensure you have the right information to successfully move from Web2…
President of El Salvador: Bitcoin Law Facilitating Zero Commissions is not Mandatory
On Monday, August 23, El Salvador President Nayib Bukele announced that the Bitcoin tender law would launch on September 7. He said it is not a must for individuals to use bitcoin. Furthermore, he confirmed financial institutions would convert BTC payments to dollars. He explained to his 2.8 million Twitter followers that people are at free will to accept BTC or not.
Bukele wrote that whoever wants to continue to carry cash may not receive a sign-on bonus. Also, they may not be able to win over customers who use BTC. Finally, they may not be able to grow their businesses or pay commission on remittances.
Nonetheless, the Salvadoran president did not cite Article 7 of the Bitcoin Law. It requires all economic agents to adopt bitcoin as payment when offered by a customer or client.
Bitcoin as Legal Tender
Recently, President Bukele introduced a bill through congress that made bitcoin a legal tender. The law exempts it from capital gains tax and requires businesses and tax collectors to adopt it. As the supermajority already passed it in the Salvadoran congress, the law should become effective two weeks from now,
According to Bukele, the law allows citizens to download an application on their devices to receive bitcoin or USD. Bukele assures citizens that they have a choice to download the app or not if they don’t want to.
With this application, you can accept payments in bitcoin or dollars. You can also open a small business, receive money from family or friends and transact remittances without commission fees. Bukele noted that they usually pay $400 Million a year in commissions on remittances. Now with this new development, the figure could effectively go down to zero.
Bukele noted that people can receive Bitcoin and convert it to U.S. dollars. Conversely, they can leave it in a digital wallet. Lastly, they can trade it for cash at one of the 200 ATMs available countrywide. He also noted that 50 branches would also be allow money withdrawals and deposits.
Several versions of a Bitcoin law have appeared since the proposal of legalizing BTC as the Salvadoran national tender. For instance, some Salvadorans protested the new law, and a survey conducted in July indicated that most Salvadorans said they were skeptical of bitcoin as a currency. Just recently, one of the Big Three credit rating agencies, Fitch Ratings, published a report on why the credit agency does not think adopting bitcoin is wise.