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The governor of the Bank of England, the country’s central bank, expressed concern about El Salvador’s choice of Bitcoin as its national currency. The governor quoted the International Monetary Fund’s (IMF) recent warning about the use of Bitcoin as legal tender: “What worries me the most is whether Salvadoran citizens understand the nature and volatility of the currency they own.”
The governor of the Bank of England worries about Bitcoin becoming legal tender in El Salvador
On Thursday, Bank of England (BOE) Governor Andrew Bailey expressed concern about El Salvador’s use of Bitcoin as legal tender in a speech at the Cambridge University Student Union. Bailey explained:
I am worried that a country will choose it as its national currency… What I am most worried about is whether Salvadoran citizens understand the nature and volatility of the currency they own.
El Salvador passed a Bitcoin law in September, making cryptocurrency legal tender along with the U.S. dollar.
President Bailey added that the International Monetary Fund’s Bitcoin legal tender.
International Monetary Fund Tell El Salvador Bitcoin “should not be used as legal tender” last week.The fund quoted “the high price volatility of Bitcoin” as saying that using Bitcoin “As legal tender, it will bring significant risks to consumer protection, financial integrity and financial stability.” In addition, “its use will also generate financial contingent liabilities.”
The IMF’s warning came a day after El Salvador’s President Naib Bukler announced plans to build the world’s first “Bitcoin City” powered by a volcano and financed by Bitcoin bonds.
Despite the warning issued by the International Monetary Fund, El Salvador Bought another 100 bitcoins, After a new Covid-19 variant was reported, used Friday’s cryptocurrency sell-off.
Governor Bailey also commented on the Bank of England’s decision to issue its own central bank digital currency (CBDC). He emphasized:
There are good reasons for digital currency, but in our opinion, it must be stable, especially when used for payment. For crypto assets, this is not the case.
The President of El Salvador responded to the concerns raised by the Governor of the Bank of England via Twitter on Saturday.
He wrote: “The Bank of England is’worried’ about the adoption of Bitcoin in El Salvador? Really? I think the Bank of England’s interest in the well-being of our people is sincere. Right? I mean, they have always cared about our people. Always . Must love the Bank of England.” Buckler Further tweets:
I am really worried about the Bank of England printing money out of thin air.
What do you think of Andrew Bailey’s comments? Please let us know in the comments section below.
Image Source: Shutterstock, Pixabay, Wikimedia Commons
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