Jun 17, 2021 - Economy

World Bank rejects El Salvador's request to help implement bitcoin

 Salvadoran President Nayib Bukele gestures during a speech for his second anniversary in power on June 1, 2021 in San Salvador, El Salvador

President Nayib Bukele, giving a speech in El Salvador's legislative assembly in San Salvado earlier this month, pushed for bitcoin to become legal tender. Photo: Emerson Flores/APHOTOGRAFIA/Getty Images

The World Bank has rejected the government of El Salvador's request to help the country implement Bitcoin as legal tender, Reuters first reported late Wednesday.

Why it matters: The international lender's rejection could hamper the government's goal of making the digital currency accepted across the country within three months.

Driving the news: El Salvador's legislature last week became the first in the world to vote in favor of formally adopting bitcoin, with plans to use it alongside the U.S. dollar, the nation's official currency.

  • Finance Minister Alejandro Zelaya said earlier Wednesday that the government had asked the World Bank for "technical assistance" in implementing the cryptocurrency, per the BBC.
  • Zelaya said government officials had also held talks with the International Monetary Fund, which he said was "not against" the plans.

What they're saying: A World Bank spokesperson confirmed to Reuters that "the government did approach us for assistance on bitcoin," but said it couldn't directly help "given the environmental and transparency shortcomings" of bitcoin.

  • "We are committed to helping El Salvador in numerous ways including for currency transparency and regulatory processes," the spokesperson said.
  • An IMF spokesperson told reporters last week: "Adoption of bitcoin as legal tender raises a number of macroeconomic, financial and legal issues that require very careful analysis."

Go deeper: El Salvador moves into bitcoin

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