Bitcoin Push as a legal tender

Subject : Economics

Context : El Salvador became the world’s first sovereign nation to adopt bitcoin cryptocurrency as legal tender

Concept :

As per the new law of El Salvador, Bitcoin, as a legal tender, can be used in any transaction and businesses will have to accept that payment form.
The law also states that tax contributions can be paid via Bitcoin and exchanges in the cryptocurrency will not be subject to capital gains tax.
Under the new law, El Salvador will promote necessary training and mechanisms so that the population can access bitcoin transactions. However, those who do not have access to technologies that can carry out bitcoin are excluded from being required to accept it as payment.
The bitcoin-dollar exchange rate will be set by the market.

Cryptocurrency:

A cryptocurrency is a digital asset designed to work as a medium of exchange.
Cryptocurrencies typically use decentralized control as opposed to centralized digital currency and central banking systems.
Cryptocurrencies are built on the back of blockchain technology, a system of distributed, cryptographically-secured account keeping.
Bitcoin is the first decentralized cryptocurrency.

Status of cryptocurrencies:

Most countries have warned their citizens against investing in cryptocurrencies and transacting in them.
Some countries have tried to use the blockchain technology to create government-sanctioned digital currencies. China, a hub of cryptocurrency activity, has issued a digital Yuan based on blockchain technology. The Bank of England has also proposed a digital Sterling.
The RBI had virtually banned cryptocurrency trading in 2018. The Supreme Court had asked the Centre in 2019 to frame policies for crypto, and in 2020, struck down the curbs imposed by the RBI. India has allowed the treatment of cryptocurrencies as commodities.
Bitcoin is the first and biggest of decentralized cryptocurrencies, which are increasingly becoming mainstream. Etherium, Tether, and Binance Coin are some of the many others that have emerged after Bitcoin.
As per available reports by the end of 2021, at least 4-5 more nations will adopt bitcoin as their sovereign acceptable currency.