The count down for Bitcoin (BTC) becoming a legal tender in El Salvador has begun.  The community spirit was like, “It is already legal in our hearts.”

Meanwhile, mixed opinions are doing the rounds.  The most prominent opinion is that El Salvador’s decision to make Bitcoin legal tender will hurt the credit ratings of local insurers.

The opinion about Bitcoin posing a threat to local insurance companies is a point expressed by Flitch ratings.

Worthy of recollecting, in June, Salvadoran president Nayib Bukele proposed a bill through congress which focused on making cryptocurrency legal tender.  Thus, BTC has been exempted from capital gains tax.  Also, the bill made it necessary for businesses and tax collectors to accept it.

This has led to a situation where Salvadoran insurers will be under pressure to convert bitcoin quickly to dollars to stay away from price risks. If it is not possible, they might face steep losses.

The September 7, 2021 deadline is coming nearer for the process to kick in. However, some of them feel that this process is “unnecessarily rushed,” further stating that this leaves little time to adapt for insurance companies.

Further, the opinion is that bitcoin is a risky reserve asset due to lack of transparency. Additionally, this can leave the insurance industry even more fragile because several insurers are already holding large caches of low-rated Salvadoran government bonds.

Pointing to El Salvador’s sovereign debt for July, it has been cited that the new bitcoin law is one of the primary reasons for the B- rating, which is considered below the investment grade. The rating agency also stated that adopting bitcoin as a legal tender could cause harm to debt-relief talks with the International Monetary Fund, further debasing the country’s bonds.

Otherwise, El Salvador is making its moves fast, and BTC enthusiasts love the changes.

If Nayib Bukele’s plans would work out, he will take El Salvador through into another halving cycle. Hopefully, with a massive industrial complex of miners. I don’t think his people will want him to leave. He has already proved himself by bringing in a lot of political progress in a short amount of time.

They have single-handedly done a lot of things bringing the BTC FUD down to a great extent. He is a man of action, and he gets stuff done.

The evolution further will be like: our state-owned geothermal electric company), to put up a plan to offer facilities for Bitcoin mining with very cheap, 100% clean, 100% renewable, 0 emissions energy from our volcanos.