El-Salvador passed its much anticipated Bitcoin Bill into a law earlier this month. The country has thus been a pioneer of Bitcoin adoption on a national scale, an action that has generated a lot of discussions among governments.
Sequel to the passage of its Bitcoin Bill, the government of El-Salvador has announced that it would be exempting foreign investors from paying any tax on the profits they make from Bitcoin.
While the exemption has heated up diverse opinions from several sectors, the Legal Adviser to the President, Javier Argueta, explained the reason behind this policy in an interview on Friday.
According to him, the government is using this friendly policy to magnetize foreign investors who would be dealing in Bitcoin—which is now a legal tender—in the course of their business and investments.
Asides from that, Mr. Javier was asked two questions with respect to El-Salvador’s adoption of Bitcoin. The first is about how the government plans to handle Bitcoin volatility, and how it hopes to curb the use of Bitcoin for criminal activities.
Concerning the first question, he noted that the government was aware of this possibility. In lieu of that, Javier said the government would “halt Bitcoin transactions” anytime its value is getting too low so as to mitigate risks in such extreme situations.
With respect to the second question, the Legal Adviser to the President said that each wallet has technical qualities that make it traceable. Such that if someone commits money laundering with it, the cops can easily find a way to trace the person.