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IMF sees legal, economic problems with El Salvador bitcoin movement

FILE PHOTO: The International Monetary Fund logo (IMF) is seen outside the headquarters building in Washington, USA, on September 4, 2018. REUTERS / Yuri Gripas / File Photo

NEW YORK (Reuters) – The International Monetary Fund said Thursday it has a number of economic and legal concerns regarding the move from El Salvador to make bitcoin a parallel legal tender.

El Salvador has become the first country in the world to adopt bitcoin as a legal tender, with President Nayib Bukele announcing the use of its potential to help Salvadorans living abroad send money transfers home.

“The adoption of bitcoin as a legal tender raises a number of macroeconomic, economic and legal issues that require very careful analysis,”

; Gerry Rice, an IMF spokesman, said during a scheduled press briefing.

“We are following developments closely and we are continuing our consultations with the authorities.”

Rice said the fund will meet with Bukele later on Thursday to discuss the bitcoin law. El Salvador is in talks with the IMF to apply for a nearly $ 1 billion program. $.

El Salvador’s law means that bitcoin will have equal footing with the dollar, which became its official currency 20 years ago.

Reporting by Rodrigo Campos; Editing Chizu Nomiyama

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