While El Salvador’s president Nayib Bukele received a lot of cheer from the crypto community when he announced that his country was moving to embrace Bitcoin as legal tender, he probably didn’t anticipate that the road to Bitcoin adoption will be laced with a lot of hurdles.
In addition to having to worry about getting support from financial institutions and the World Bank, Bukele will now have to deal with the Farabundo Martí National Liberation Front (FMLN) party, which is against the decision of making Bitcoin legal tender.
The FMLN party is supporting a public lawsuit seeking to abolish the recently passed Bitcoin legal tender law. According to them, the pro-crypto move is “unconstitutional.” The party and other interested members of the public moved the Constitutional Chamber of the Supreme Court of Justice (CSJ) against the bill, Spanish news outlet El Mundo reported Monday.
The party’s deputy Jaime Guevara opined that the Bitcoin law had “no legal basis” and was passed to “loot people’s pockets, it is tax-exempt, they want to force us to trade.”
One of the lead plaintiffs in the case, Oscar Artero, also stated that the bill was passed without proper scrutiny and legal considerations.
As reported by BTC PEERS, the Bitcoin law was passed by the Salvadorian Congress following a 62/80 voting session in support of the move. Bukele’s party clearly dominates the Congress as it currently holds 56 out of the 80 seats in the parliament. FMNL, on the other hand, controls just four seats.
It is unclear how the matter with pan out since the opposition has decided to go to court. However, there are rumors that the government is secretly mulling over banning the law. The El Mundo report referenced the now rampant rumor. According to Enrique Anaya, an expert lawyer in the country, the lawsuit is being orchestrated by the President who is looking for a way to silently roll back the decision to accept Bitcoin. Although Guevara has denied working with the government on this, the report stated that a survey from a corporate alliance shows that eight out of ten respondents are not in support of the government’s decision.
A case study for other nations
El Salvador’s move to make Bitcoin a form of money is setting a precedent for other nations to follow. However, a wrong move could be disastrous for the crypto industry.
From day one, the government has faced a lot of opposition regarding its decision. First, the International Monetary Fund (IMF) expressed its concerns over the government’s decision. The World Bank also denied technical assistance to the country. El Salvador relies heavily on these organizations for economic assistance, and its latest decision does not appear to sit well with them. If the country is able to weather through the storm and maintain Bitcoin as legal tender, it will become a major win for the entire crypto industry. On the flip side, if the nation succumbs to pressures from international monetary organizations and rolls back its law, other anti-Bitcoin governments could easily take a cue and move to crush the asset class.
So far, the country appears to be doing just fine. The payment firm leading the adoption drive Strike is positive that things are going as planned. In a recent podcast, the CEO of Strike Jack Mallers confirmed that five top banks and two of the biggest cashpoint distributors in El Salvador are in on the development.