The World Bank has poured cold water on El Salvador’s adoption of bitcoin as legal tender, saying it cannot support the move due to “environmental and transparency” concerns.
But the developmental body may soon be forced to accept bitcoin payments from countries that have embraced the cryptocurrency.
Its founding document, the 1944 Articles of Agreement, outlines the procedures and principles by which the World Bank pledges to engage with sovereign governments. A central theme in the document is its commitment to accept payments from member states in local currencies.
Section 12 of Article V defines acceptable “forms of holdings of currency” as follows:
That’s not a foregone conclusion. Reuters asked them about that yesterday and got a decidedly arsey response. “We are committed to helping El Salvador in numerous ways, including for currency transparency and regulatory processes,” a spokesperson waffled. “While the government did approach us for assistance on bitcoin, this is not something the World Bank can support given the environmental and transparency shortcomings.”
The World Bank, by the way, has invested more than $12bn in fossil fuel projects over the past six years, representing at least 6% of its total investment portfolio. It also accepts gold payments from members, despite gold mines emitting on average 0.8 tonnes of CO2 for every ounce of gold produced.
Still, they’re worried about bitcoin’s carbon footprint. So they’ll be happy to know that, by some estimates, 76% of bitcoin miners are already using renewable energy.
Oh yes, and every transaction ever made on the bitcoin network is recorded on an immutable digital ledger that is fully visible to all market participants. That makes it, by far, the most transparent monetary network that has ever existed. No funny business allowed.
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