In a surprising move, El Salvador has revoked Bitcoin's legal tender status, less than four years after the Central American country became the first in the world to adopt it. The decision follows a reform to the Bitcoin Law, approved by the Legislative Assembly on Wednesday.

The reform, which modifies six articles and eliminates three from the original pioneering legislation passed in September 2021, means that Bitcoin is no longer official currency in El Salvador. Its use will be relegated to exchanges between citizens and private companies, and its acceptance will no longer be mandatory, but voluntary.

The reform initiative was presented by Tourism Minister Morena Valdez at the request of President Nayib Bukele, who has not publicly commented on the issue. The decision comes amid a challenging economic context for the country and amid negotiations with the International Monetary Fund (IMF) for a $1.4 billion loan, for which the entity imposed as a condition "mitigating the risks of Bitcoin."

Confusion and Criticism

The reform has caused confusion and criticism due to the new wording of some articles. One of the most controversial points is the modification of the first article of the law, which eliminated the term "currency" but kept the term "legal tender."

#BTC $BTC