The recently approved law in El Salvador, which recognizes bitcoin (BTC) as legal tender in that nation, has raised various opinions, some in favor, but also against.
Experts have put the magnifying glass, specifically, on the freedom of those who do not want to accept cryptocurrency as a payment method, when the new legislation makes it mandatory in article 7.
Social networks like Twitter have been the place to many have resorted to present their allegations against the so-called Bitcoin Law.
One of them was George Selgin, an American economist and director of the Center for Monetary and Financial Alternatives (CATO). This Washington-based body is charged with revealing the deficiencies of centralized monetary and financial regulatory systems and promoting libertarian ideas.
Selgin, in a series of tweets, notes that the law is a “victory” for Bitcoin, but doubts that it goes in favor of freedom.
The law “undermines free choice”
Selgin declares himself a defender of the free choice of currency and of the private market alternatives to official currencies. However, does not believe that the approval of the Bitcoin Law should be celebrated, especially by articles 7 and 13, as it considers “they undermine the free choice of currency instead of promoting it.”
According to article 13 of the Bitcoin Law “all obligations in money expressed in USD, existing before the effective date of this law, can be paid in bitcoins.”
The director of the Center for Monetary and Financial Alternatives, George Selgin considers that articles 7 and 13 of the Bitcoin Law of El Salvador should be denounced.
The expert considers that the article “is not less at odds both with the free choice of currency and with the freedom of contract, since past legal tender laws allowed payment in kind contracts to be settled using fiat money.
With article 7, Selgin was more severe, by saying that it is “much worse.” Said article states that “every economic agent must accept bitcoin as payment when it is offered to him by whoever acquires a good or service.”
For his part, Selgin created the article forces merchants to accept BTC as payment, even if they prefer to be paid in USD. “Very few countries have such draconian legal tender laws that in the past they were the last resort of desperate governments,” he added.
Selgin ended his thread on Twitter by assuring that he found the spectacle “abominable” and also hopes that those who now “celebrate” it reconsider and publicly denounce articles 7 and 13 of the new law.
Experts believe that the Bitcoin Law “threatens freedom”
An observation similar to Selgin’s is made by the Argentine lawyer Víctor Castillejo Arias, in a talk covered by CriptoNoticias, called »Bitcoin: legal tender in El Salvador».
«Article 7 speaks of forced acceptance. This means that everyone who participates in the economy has to accept bitcoin. That creates many problems and you have to see how the machinery is oiled for that to work. Not everyone wants to accept bitcoin ”, explained Castillejo Arias.
However, article 12 indicates that those who, due to a notorious fact and obviously do not have access to technologies that allow transactions in bitcoin, are excluded from the obligation expressed in article 7.
In this sense, Castillejo Arias considered that it will be “contentious, but it is a necessary exemption.” In this sense, he added that “people in extreme vulnerability cannot accept bitcoin. Instead, companies can mitigate to not accept bitcoin as currency and rely on this article.
For his part, Martin Litwak, an Argentine lawyer specialized in international wealth planning, also expressed his position on the Bitcoin Law of El Salvador, through Twitter.
Litwak expressed that he is in favor of cryptocurrencies, but against the decision of the President of El Salvador, Nayib Bukele regarding bitcoin.
«Since everything that is not prohibited, is allowed; government permission was not necessary to ‘legalize’ the use of cryptocurrencies, “said the lawyer. In addition, Litwak believed that “forcing” people to receive cryptocurrencies “violates their freedom.”
The lawyer added that cryptocurrencies should not be regulated as currencies but as a category of assets unto itself.
On Litwak’s statement, it is important to clarify the concept of “legal tender”. It is the form of payment, defined by the law of a State, which has been declared acceptable as a means of exchange and a legal way to cancel debts.
In El Salvador, the use of cryptocurrencies was not legalized (as it was not illegal), but it was declared legal tender, something completely different.