El Salvador’s Congress approved legislation to establish a $150 million fund to make Bitcoin-to-US dollar conversions easier. The law comes a week ahead of the country’s planned adoption of the benchmark cryptocurrency as legal tender. 
<h2>El Salvador's Congress Passes Law to Create $150M Fund for Bitcoin Conversions</h2>
According to <a href="https://www.reuters.com/article/el-salvador-bitcoin/update-1-el-salvador-congress-backs-150-mln-fund-for-bitcoin-ahead-of-adoption-idUSL1N2Q2211?rpc=401&amp;" target="_blank" rel="nofollow noopener">Reuters</a>, Salvadoran Congress approved the fund with an overwhelming majority of 64 to 14 votes. Money for the fund will be allocated by El Salvador’s finance ministry and administered by the state development bank BANDESAL. 

“The purpose of this law is to financially support the alternatives that the state provides, without prejudice to private initiatives, that allow the user to carry out the automatic and instantaneous convertibility of bitcoin to the United States dollar,” the congressional document stated.

It is possible that the fund would be used for the 200 Bitcoin ATMs and 50 financial centers announced by President Nayib Bukele <a href="https://www.cryptoknowmics.com/news/infrastructure-being-built-for-el-salvadors-bitcoin-adoption-nayib-bukele/">last week</a>. Bukele had emphasized that the government is expanding Bitcoin-related infrastructure that would work in conjunction with the Chivo digital wallet. This will help people withdraw and deposit their Bitcoins conveniently without commissions. 

Bukele estimates that adopting Bitcoin would save the citizens of El Salvador $400 million paid every year on receiving remittances from abroad. Despite his optimism, the Bitcoin law has come under fire due to the cryptocurrency’s volatility and its potential to encourage corruption in public life. 
<h2>IMF Reiterates the Risks of Bitcoin Adoption</h2>
The International Monetary Fund has <a href="https://www.cryptoknowmics.com/news/the-imf-opposes-the-use-of-cryptocurrencies-as-legal-tender/">once again</a> warned countries against the adoption of cryptocurrencies. The fund’s latest warning is a reiteration of its stance explained in a July blog post titled ‘Crypto assets as National Currency? A Step Too Far'. 

“Privately issued crypto-assets like bitcoin come with substantial risks. Making them equivalent to a national currency is an inadvisable shortcut," IMF said in a tweet on Sunday.

Notably, both the IMF and World Bank have already expressed their disapproval of El Salvador’s crypto legislation. The World Bank, in particular, rebuffed El Salvador’s request for assistance with Bitcoin implementation in June.

El Salvador's Congress Approves $150 Million Fund for Bitcoin Conversions

On Tuesday, El Salvador’s Congress approved legislation to establish a $150 million fund to make Bitcoin-to-US dollar conversions easier.

Divya is a postgraduate from Jawaharlal Nehru University specializing in International Relations and a professional writer with more than 5 years of experience writing for the web. She is an avid reader interested in the global financial system and the effects of decentralization. At Cryptoknowmics, she hopes to deliver clear and understandable content to inform readers about the latest events in the crypto sector.

El Salvador's Congress Approves $150 Million Fund for Bitcoin Conversions

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