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According to a Salvadoran government official, while businesses must accept BTC transactions, they can choose whether to settle transactions in BTC or USD.
The day before the country’s controversial Bitcoin Law recognising Bitcoin as legal cash went into effect, Javier Argueta, the legal counsel of the Presidential House of El Salvador, addressed the requirements of businesses in an interview with local media.
According to the legal counsel to El Salvador’s president, businesses are required to accept Bitcoin (BTC) from clients, but they have the option of receiving BTC or US dollars once the transaction is completed.
According to a rough translation, Argueta highlighted that while it is required for businesses to maintain a “electronic wallet” in order to accept Bitcoin, “in the transaction […] you have the will to take Bitcoin or dollars, that is why it is voluntary.”
“If I buy you 1,000 shirts that cost $200 and I’m going to pay you in Bitcoin, you have the wallet, but in the transaction, when you do it, you have the will to receive Bitcoin or dollars, that is why it is voluntary.”
Businesses that refuse to accept BTC will be in violation of local legislation, according to the official. According to ElSalvador.com, “all businesses are obliged to make the transaction in Bitcoin and, despite the fact that neither the law nor the regulations specifically mention it, if the firm does not accept it, it is susceptible to referrals of infringement to the Consumer Protection Law.”
#ElSalvador | Según Javier Argueta, asesor jurídico de Capres, todos los empresarios que no hagan uso de la billetera Chivo y se nieguen a hacer la transacción con #Bitcoin se enfrentan a legislaciones como Ley de protección de consumidor; se harán remisiones.
— elsalvador.com (@elsalvadorcom) September 6, 2021
Users of the government’s Chivo wallet can make transfers in both Bitcoin and US dollars. The wallet is managed in collaboration with the Mexican crypto exchange Bitso, which says it is collaborating with the California-based crypto-friendly bank Silvergate to handle USD transactions.
The programme also enables merchants to automatically convert Bitcoin into dollars.
The clarification comes as local businesses fight back against language in the Bitcoin Law that stipulates merchants “must” accept Bitcoin as a form of payment, with private-sector leaders calling for the legislation to be reworded.