Saint Kitts and Nevis, an island state in Central America, is considering making Bitcoin Cash legal by March 2023.
The good news comes from the Bitcoin Cash 2022 Conference held last Nov. 12 and 13, where Terrance Drew, Prime Minister of the Central American island state St. Kitts and Nevis, revealed a positive intention toward Bitcoin.
It appears that the country is following a process of integrating cryptocurrencies into its economy and, just as part of this process, is studying this operation.
Drew confesses: Bitcoin Cash as legal tender could be the turning point
In the speech given by Drew, the prime minister’s intentions are clear:
“I welcome the opportunity for further dialogue to explore opportunities to mine Bitcoin Cash and make it legal tender in St. Kitts and Nevis by March 2023, once safeguards are secured for our country and our people”
Apparently, according to Drew, his country is increasingly realizing the possible benefits that adopting crypto like Bitcoin as legal tender would bring.
In fact, already many businesses on the island accept Bitcoin Cash as a method of payment.
Logically, this is a complex and time-consuming operation that can only be put in place after considering all aspects of such a venture and following all the necessary due diligence best practices.
However, the intention is there, and for Bitcoin, the most prestigious and highest-valued crypto, the news bodes well. Since cryptocurrencies have always and by many been viewed with hostility and distrust.
Nevertheless, Bitcoin in particular has never given up and, while letting those who doubted its potential speak for themselves, it has gradually built a veritable empire.
In any case, if the country went ahead with its project, it would follow in the footsteps of other states that have already moved in this direction, such as El Salvador. Which declared Bitcoin a legal tender in June 2021.
Bitcoin: the first to adopt it as legal tender is El Salvador
On September 7, 2021, the Central American state of El Salvador officially became the first country in the world to adopt Bitcoin Cash as legal tender. On that occasion, President Nayib Bukele formally stated his goals, saying:
“The goal is to boost economic development and allow citizens to save on the 400 million dollars in commissions paid in remittances from the US and other countries”
Specifically, the law institutionalizing cryptocurrency was passed in June 2021 with 62 out of the 84 available votes in the Legislative Assembly, the Salvadoran parliament.
The measure, hailed as “historic” by Bukele, requires merchants and businesses to accept the queen of cryptocurrencies as a method of payment, in a condition of equivalence to the other official currency in the country (the U.S. dollar).
The executive announced on September 6, 2021, the purchase of the first 400 bitcoins and was then working on installing 200 counters in the country to allow conversion between the two currencies and withdraw bitcoins at no extra cost.
In addition, there was also a kind of national promotion to get closer to the instrument: the equivalent of thirty dollars in bitcoin as a gift to anyone using the digital wallet available through an app called Chivo.
Advantages and criticisms of Bitcoin Cash as a legal tender
The countless advantages of adopting Bitcoin Cash as legal tender are several and were already enunciated by Bukele when he made it so in El Salvador. However, as with any major innovation, there has also been no shortage of criticism from skeptics.
Let’s try to get an accurate picture of the situation. As a legal tender currency, Bitcoin Cash offers fee savings and is certainly an important business lever.
In addition, innovation leads to greater financial inclusion, potentially solving the unbanked problem, more investment, tourism, innovation and economic development for countries, especially with an eye on savings on remittance flows.
Indeed, the adoption of Bitcoin Cash could greatly reduce the burden of fees and make sending money cheaper, with a positive leverage effect for the national economy.
As already anticipated, even in the face of these benefits, there has been no shortage of criticism. Many are still scared and disagree with the decision made first by El Salvador and now probably by St. Kitts and Nevis.
This is because they see Bitcoin as too volatile a currency and fear for the transparency and environmental risks of mining by Central American countries. In addition, critics fear that the effect of Bitcoin as a legal currency is to fuel money laundering.
Meanwhile, some analysts warn of the reputational damage of ” Government Bitcoin” in the eyes of foreign investors.