Bitcoin Law in El Salvador Denies Its People a Choice

Avik Roy’s June 30 letter, written in response to our op-ed “El Salvador’s Big Bitcoin Mistake” (June 23), argues that El Salvador’s Bitcoin Law will improve Salvadorans’ freedom of foreign money alternative. His conclusion is unfounded and incorrect.

To draw any conclusion, Mr. Roy should know the small print of the authorized modalities of what governs foreign money alternative in El Salvador, specifically the Law of Monetary Integration (2000). This legislation, which we had a hand in drafting, successfully dollarized El Salvador. Articles 2 and 6 specify that foreign money competitors shall prevail. Any foreign money that’s mutually agreed upon by patrons and sellers is authorized to make use of for all commerce and contractual obligations.

Enter the Bitcoin Law of June 8. Article 7 mandates that Salvadorans should settle for bitcoin if supplied. This is a customary function of forced-tender legal guidelines. It will rob these being supplied bitcoin a alternative and prohibit the freedoms enshrined in El Salvador’s aggressive foreign money regime.

Prof. Steve H. Hanke

Johns Hopkins University

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