Patrick is an accounting & economics graduate, a Cryptocurrency enthusiast, and a Blockchain technology fanatic. When not crafting informative pieces on any of the above subjects, he will be researching on how the Blockchain technology can transform the world, particularly the financial space.
The World Bank declined to support El Salvador in its bid to adopt Bitcoin as a mainstream currency. Environmental impacts, carbon emissions amid mining, and transparency issues were among the reasons for the refusal.
The World Bank has yet again declared its stance on Bitcoin, and according to the latest development, the global financier isn’t ready to adopt Bitcoin or any other crypto as a mainstream currency. The bank’s representative was quoted saying that even though the government had approached them on Bitcoin adoption, the bank can’t in any way help out given the transparency and environmental issues surrounding Bitcoin. The spokesperson however added that the bank was ready to work with El Salvador to try and sought out the country’s monetary issues, particularly currency transparency and monetary regulations.
Before the request to the World Bank’s team, Alejandro Delays (El Salvador’s minister of finance) stated that El Salvador had requested technical assistance from the World Bank a.k.a Banco Mundial in terms of regulation and implementation of Bitcoin, to make it a legal tender in the South American country.
Effects of the Refusal of World Bank to Support El Salvador in Its Bitcoin Move
As you can already tell, pundits and notable Bitcoiners weren’t surprised by the World Bank’s decision to decline such a noble move. However, they were neither pleased. One Bitcoiner, Anthony Pompliano, stated in a tweet that the World Bank is yet to figure a way to profit from Bitcoin. The developer of Ignite Blockchain-based game, Samson Sow, who’s also Blockstream’s CSO was clearly vexed by the news when he suggested, via a tweet, that the global financial outfit is obsolete and should be disbanded.
While El Salvador’s Bitcoin laws have been well received by Bitcoiners, they’ve also attracted criticism in equal measure. On Wednesday, one economist, Steve Hank, was quoted saying that if El Salvador adopts Bitcoin and make it a legal tender, the end result will be a collapsed economy.
Other global financial bodies, particularly the International Monetary Fund (IMF), aren’t pleased with the idea of embracing Bitcoin. An article published on Cointelegraph indicated such a move will stall the ongoing negotiations between the IMF and El Salvador regarding a $1B loan meant to boost the country. The International Monetary Fund representative added that Bitcoin’s adoption comes with consequences and has a negative impact on many spheres of a country’s macroeconomics.
Help from Other Quarters
Following the setback, some companies have rushed in to provide a soft landing. One such company is Athena Bitcoin that intends to provide ATMs across the South American country. In a tweet, Athena Bitcoin enquired from the president if 1,000 automated machines would suffice. However, the president jokingly answered back “how about 1500?”
In other news, Ronaldo Castro, the country’s Labor and Welfare minister denied the ongoing claims that his ministry was in talks about compensating employees with Bitcoin. He stated that the discussion surrounding wages was too premature.