Cryptocurrency News - 'Cryptocurrency' Legal In El Salvador, A New 'Headache' For Banks_Pic Credit Google

Cryptocurrency News – ‘Cryptocurrency’ Legal In El Salvador, A New ‘Headache’ For Banks!

Cryptocurrency News – ‘Cryptocurrency’ Legal In El Salvador, A New ‘Headache’ For Banks! – These days there’s tons of turmoil within the world regarding cryptocurrencies. Sometimes a tweet by Tesla chief Elon Musk is creating a ground-sky difference in its value, and sometimes China’s taking strict action against it’s increasing concern round the world.

Cryptocurrency News – ‘Cryptocurrency’ Legal In El Salvador, A New ‘Headache’ For Banks!

Meanwhile, recently El Salvador a rustic in Central America, has passed a law to think about cryptocurrencies as tender because of which now a replacement problem has arisen for the banks round the world.

Increased risk of cash laundering

According to the news of PTI, rating agency Fitch has issued a report regarding this. The report said that El Salvador’s treating bitcoin as a tender has posed tons of risks to banks. This includes violation of laws made for prevention of cash laundering, terror funding etc.

To be effective from 7 September

El Salvador’s decision to think about bitcoin a tender is to require effect from 7 September. Fitch says this may increase regulatory, financial and operational risks for financial institutions.

Cryptocurrency News – ‘Cryptocurrency’ Legal In El Salvador, A New ‘Headache’ For Banks!

Fitch has said in its report that the likelihood of using bitcoin for everything from lending to lending is causing concern. this might increase bitcoin traffic from El Salvador and increase the danger of illegal activities in Salvador’s economic system .

Bitcoin use alternative

El Salvador President Nayib Bukele said on Thursday that the utilization of bitcoin would be optional. this suggests that the one that receives the payment with bitcoin can automatically convert it into US dollars. The dollar has been tender in El Salvador for the past 20 years .

Fitch says that the principles for creating bitcoin a tender should fully suits the worldwide Standards of the Paris-based Financial Action Task Force. Because bitcoin lacks transparency and this will increase the danger of cash laundering.

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