Jun 17, 2021 - Economy

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

Rebecca Falconer

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

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