El Salvador Government Confirms Every Merchants Must Accept Payments In Bitcoin
JAKARTA - In an interview with local media, Javier Argueta, legal adviser to El Salvador's Presidential Palace, clarified business obligations a day before the country's controversial Bitcoin Act that recognizes BTC as legal tender goes into effect.
The legal counsel of the President of El Salvador has stated that every business and enterprise entity is mandated to accept Bitcoin from customers, however they can choose whether they will accept BTC or US dollars once the transaction is completed.
According to a rough translation, Agueta emphasizes that it is mandatory for a business to “have an electronic wallet” to accept Bitcoin, but “In a transaction [...] you have a desire to receive Bitcoin or dollars, which is why it is voluntary.”
“If I buy you 1,000 shirts for 200 and I will pay you in Bitcoin, you have a wallet, but in transactions, when you do, you have a desire to receive Bitcoins or dollars, which is why it happens. It is voluntary.”
The official added that businesses that refuse to accept BTC will be considered violating local regulations. The ElSalvador.com website states: "According to Argueta, all businesses are required to transact in Bitcoin and despite the fact that neither the law nor the regulations clearly state it, if a business does not accept it, it is subject to referrals for a violation of the Consumer Protection Act."
The government Chivo wallet allows users to process transfers in BTC and US dollars. The wallet is managed in partnership with Mexican crypto exchange Bitso — which says it works with California-based crypto-friendly bank Silvergate to facilitate USD-denominated transactions.
The app also allows merchants to automatically convert the Bitcoins they receive into dollars.
The clarification came as local businesses challenged the language contained in the Bitcoin Act stating merchants “must” accept Bitcoin as a means of payment, with representatives from the private sector pushing for the law to be rewritten or revised.