The World Bank has refused El Salvador’s request to aid the country in their use of Bitcoin as their legal tender.
The international bank cited worries about the environmental effect of Bitcoin and transparency issues.
Earlier this month, El Salvador announced their plans to become the first country to formally use the digital currency.
It seeks to use Bitcoin as a secondary tender along with the US dollar.
The World Bank’s choice could mean the nation faces roadblocks in reaching its deadline to guarantee that Bitcoin can be accepted nationwide within three months.
“We are focused on helping El Salvador in multiple ways including for regulatory processes and transparency., a spokesperson for the World Bank said.
“While their government did come to us for assistance, this is not something we can support due to the environmental and transparency problems., they said.
This comes following El Salvador’s Minister of Finance, Alejandro Zelaya said this week that his country asked the global Bank for technical help with the use of cryptocurrency as an official means of payment.
Mr Zelaya also said the talks with the IMF were successful, saying that the international organization was “not against” the use of Bitcoin.
But the IMF has recently said it viewed “macroeconomic and legal problems” with El Salvador’s use of Bitcoin.
Also, last week, El Salvador became the first nation to officially label Bitcoin a legal currency.
Its Congress passed President Nayib Bukele’s measure to embrace the digital currency.
President Bukele announced that his government made history, and that the new agenda would allow Salvadoreans who are living elsewhere to more easily send money back home.
Under his legislation Bitcoin will be seen as legal tender, along with the US dollar.
The new law means all businesses must accept Bitcoin for goods and services, unless they are unable to have the technology needed to conduct the transaction.
Author: Scott Dowdy