El Salvador has passed a law making Bitcoin legal tender, making it the first country in the world to officially adopt cryptocurrency as its official currency.
The Bitcoin law was passed by a “super majority” within the Congress of the Central American country.
>> Keep track of the latest price updates and predictions The independent one‘s live coverage of the crypto market
“The purpose of this law is to regulate Bitcoin as unrestricted legal tender with liberating power, indefinitely in every transaction and for every title that public or private natural or legal persons demand,” says the Bitcoin Act.
“It is the duty of the state to facilitate the financial inclusion of its citizens in order to better guarantee their rights.”
An estimated 70 percent of Salvadorans do not have access to traditional financial services such as bank accounts.
Bitcoin’s legal tender status means it will not be subject to capital gains tax, which President Nayib Bukele hopes will also attract crypto entrepreneurs to the country.
Bitcoin price soared 5 percent after the announcement on Wednesday.