El Salvador approves $150 million fund to legalize bitcoin

The funds will support a plan to adopt cryptocurrency as an official means of payment. The new rules will go into effect on September 7

El Salvador’s Legislative Assembly Finance Commission has approved a $150 million trust fund to support a bitcoin legalization plan. Local media report that the amount could be increased over time. On Sept. 7, a new law will take effect in El Salvador that will make the first cryptocurrency an official means of payment.

Funds from the new fund will be used, among other things, to pay $30 in bitcoin bonuses that Salvadoran citizens will receive when they activate the state’s Chiva cryptocurrency wallet. It will also be launched on September 7. In addition, the country’s authorities are installing 200 bitcoin ATMs. The government estimates that there are now 50 thousand bitcoin users in El Salvador. It is planned that this number will grow to 4 million.

In July it was reported that the presidential administration of El Salvador began working on a project of its own steiblocoin, which will be called “Colón-dollar”. The stablecoin is expected to be released by the end of this year.

El Salvador recognized bitcoin as official tender in early June along with the U.S. dollar, already used as the country’s currency. Under the new rules, prices in the country can be set in bitcoin, and taxes can also be paid in the cryptocurrency. Bitcoin exchanges will not be subject to capital gains tax.

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