World Bank Won't Help El Salvador Develop Its BTC Project

The World Bank has refused a request from El Salvador to assist in the country’s implementation of BTC as legal tender. The financial institution gives grants or technical assistance to countries pursuing large financial projects. 

When it comes to BTC, the World Bank has said it is concerned about transparency and the leading cryptocurrency’s impact on the environment. 

“We are committed to helping El Salvador in numerous ways for currency transparency and regulatory processes,” a World Bank spokesperson reportedly told Reuters yesterday, adding, “While the government did approach us for assistance on BTC, this is not something the World Bank can support given the environmental and transparency shortcomings.” 

Yesterday, the Salvadoran Finance Minister, Alejandro Zelaya, admitted that the government had approached the World Bank for technical assistance on BTC.

Doubt over El Salvador’s BTC project

The World Bank is not the only major financial institution to cast doubt over El Salvador’s decision to adopt BTC as legal tender. 

Earlier this month, the International Monetary Fund (IMF) said that El Salvador’s decision raises several “macroeconomic, financial, and legal issues that require very careful analysis.” 

JP Morgan also poured cold water on El Salvador’s decision. 

“There are clearly important implications for that country, but it is difficult to see any tangible economic benefits associated with adopting BTC as a second form of legal tender,” JP Morgan analysts said last week. 

But it’s not all bad news for El Salvador. 

Benoit Coeure, head of the Bank for International Settlements’ Innovation Hub, said El Salvador’s BTC move was an “interesting experiment.” 

However, Coeure qualified this comment by telling Decrypt the BIS does not believe BTC has passed the test as a means of payment. 

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