In El Salvador, which broke new ground in the world on September 7 and made Bitcoin a legal currency in the country, some new rules are also being introduced on the biggest crypto money to encourage investments.
“To encourage investment…”
Speaking to AFP, Javier Argueta, an adviser to President Nayib Bukele, said that foreigners will be exempt from the Bitcoin tax:
“If a person has Bitcoin and earns a substantial profit rate, there will be no tax for that person. We do this to encourage foreign investment. There will be no tax on both income and capital increase.”
Measures taken for price collapse
Argueta also informed that the official wallet, which allows El Salvadorans to buy and spend Bitcoin, also has some mechanisms for asset tracking:
“We also follow the recommendations of international institutions to take measures against money laundering. In addition, we decided to stop the transactions for a short time and minimize currency fluctuations in case of a collapse in the Bitcoin price.
Declaring Bitcoin as legal as the US dollar last week, El Salvador is constantly warned by US-based institutions for money laundering and volatility. The World Bank also answered ‘No’ to El Salvador’s offer of assistance for Bitcoin to be used more comfortably in the country.
Experts argue that the volatility of Bitcoin is also dangerous in a country with high unemployment and poverty, while government officials say that the commissions on funds sent from abroad, especially the USA, will greatly decrease. Figures show that funds from abroad account for more than a fifth of the country’s GDP.
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