Topic: Legal tender definition (Read 315 times)
It's means legally accepted payments, coins.....
It's means legally accepted payments, coins etc.
I think shops do not have the right to refuse to accept bitcoin because this would be similar to refusing to accept the national currency of any country, for example in France shops do not have the right to refuse to accept the French franc because it is the national currency of the country, now bitcoin in El Salvador has become the national currency and no shops have the right to refuse to accept Pay with bitcoin, but of course they have the right to convert bitcoin to any other coin if they want to. I think the real test of Bitcoin on the ground has just begun.
What does it mean for bitcoin to be legal tender in El Salvador?
Does it mean all shops are forced to accept bitcoin or shops can accept bitcoin only if they want to? Logically, it doesn't make sense for it to be the first option because not all shops will have the infrastructure to (e.g. a small convenience store or grocery shop). If it is the second option, then I doubt many shops will opt for it.
Or does it mean products in El Salador are priced in satoshis?
I believe that it is a little wrong to say that in El Salvador, for the first time, bitcoin was recognized by the state as legal tender. Cryptocurrency becomes legal tender on the territory of a particular state when a law or other equivalent regulation is adopted stating that this cryptocurrency or cryptocurrency as a whole is officially recognized as a means of payment and the procedure and conditions for its circulation in the territory of the state are established. In other words, cryptocurrency is being legalized on the territory of this state. At the same time, the cryptocurrency will go along with the national currency, but it is not mandatory for acceptance by all individuals, institutions and organizations.Does it mean all shops are forced to accept bitcoin or shops can accept bitcoin only if they want to? Logically, it doesn't make sense for it to be the first option because not all shops will have the infrastructure to (e.g. a small convenience store or grocery shop). If it is the second option, then I doubt many shops will opt for it.
Or does it mean products in El Salador are priced in satoshis?
In the case of El Salvador, for the first time, bitcoin became the national currency, that is, in addition to the fact that it became an official means of payment, like the national currency, it is mandatory for acceptance and settlement on the territory of this state.
[...] It is legally approved for every one to accept it in that country and once it is a law, refusing to accept it is a crime or an offense already and that is the major difference. [...]
Yes and no. Not sure how it's in other countries, but at least in the US there's the... loophole, I guess? that while legal tender must be accepted to settle debt, a business can deny service based on a would-be customer's payment method. That's why it's perfectly legal for stores to not accept cash and go cashless only: If they don't provide you with a service or product, there's no debt to settle in the first place.
I'll leave it as an excercise for the reader what this implies about the value of fiat currencies.
Yes from what you said, that is buttressing the choice of the financial service or payment system to use. For jurisdiction that have opened a choice that is used in the country or mode(s) of payment or receiving payment, yes there should be a choice to choose from. For example from what you said, the receiver who sold product to customer may have choice of payment mode (base on the convenience) if they don't want physical cash and want e-banking transfer or if cryptocurrency, that's if the country is adopting cryptocurrency. But where the country has not adopted any other mode and only cash/fiat then the legal tender comes into it to be must for acceptance. That is how I understand legal tender, nobody can refuse it not to be money if the law has made it so.
What does it mean for bitcoin to be legal tender in El Salvador?
Does it mean all shops are forced to accept bitcoin or shops can accept bitcoin only if they want to? Logically, it doesn't make sense for it to be the first option because not all shops will have the infrastructure to (e.g. a small convenience store or grocery shop). If it is the second option, then I doubt many shops will opt for it.
Or does it mean products in El Salador are priced in satoshis?
Does it mean all shops are forced to accept bitcoin or shops can accept bitcoin only if they want to? Logically, it doesn't make sense for it to be the first option because not all shops will have the infrastructure to (e.g. a small convenience store or grocery shop). If it is the second option, then I doubt many shops will opt for it.
Or does it mean products in El Salador are priced in satoshis?
Products definitely don't need to be priced in satoshis and I think that most if not all are still in terms of USD.
It's just that people are able to always get out of a transaction paying with BTC - the merchant can't technically refuse.
I'm sure that practically it's a bit different since not every single transaction ends up in court, but this does allow much greater adoption to happen.
[...] It is legally approved for every one to accept it in that country and once it is a law, refusing to accept it is a crime or an offense already and that is the major difference. [...]
Yes and no. Not sure how it's in other countries, but at least in the US there's the... loophole, I guess? that while legal tender must be accepted to settle debt, a business can deny service based on a would-be customer's payment method. That's why it's perfectly legal for stores to not accept cash and go cashless only: If they don't provide you with a service or product, there's no debt to settle in the first place.
I'll leave it as an excercise for the reader what this implies about the value of fiat currencies.
Really good question that I think is overlooked by most people.
From my understanding, if the debtor wants to settle their debt in a court of law through bitcoin, then the creditor cannot possibly come back and say that they haven't been paid.
But in practice I'm sure that there will be merchants that deny BTC, although if the customer decides to insist paying, I don't see a reason why it can't be done.
From my understanding, if the debtor wants to settle their debt in a court of law through bitcoin, then the creditor cannot possibly come back and say that they haven't been paid.
But in practice I'm sure that there will be merchants that deny BTC, although if the customer decides to insist paying, I don't see a reason why it can't be done.
It's the buyer's decision that's left; the sellers in El Salvador accept Bitcoin by law.
The difference between legal tender and other payment system is that it is backed by the law the land. It is legally approved for every one to accept it in that country and once it is a law, refusing to accept it is a crime or an offense already and that is the major difference. You can't force someone to use or accept the use of some payment notes like cheques for example, you can only make it an option but money iself can't be rejected to be used that is the meaning of legal tender.
According to google if you search legal tender, you get this kind of definition
And in Nigerian system
According to Wikipedia, legal tender is defined as a coin or a bank note that is recognized by the court of law as a way to monetary debt. So in the context of El Salvador making bitcoin a legal tender, it doesn't necessarily mean that bitcoin is used for everyday currency but they can be used and is recognized in the country.
Yes!a generally accepted coin is known as a legal tender,and making Bitcoin to be a legal tender today can be possible,the only problem is that some government of some countries fight it,some ban it from existence.countries like Nigeria,the government of that country banned it from existence,but it is been used the more in that country now.If Bitcoin were to be generally accepted in all the countries,without the government of some countries fighting or banning it,it would have been very good.
According to Wikipedia, legal tender is defined as a coin or a bank note that is recognized by the court of law as a way to monetary debt. So in the context of El Salvador making bitcoin a legal tender, it doesn't necessarily mean that bitcoin is used for everyday currency but they can be used and is recognized in the country.
What does it mean for bitcoin to be legal tender in El Salvador?
Does it mean all shops are forced to accept bitcoin or shops can accept bitcoin only if they want to? Logically, it doesn't make sense for it to be the first option because not all shops will have the infrastructure to (e.g. a small convenience store or grocery shop). If it is the second option, then I doubt many shops will opt for it.
Or does it mean products in El Salador are priced in satoshis?
Keeping it very simple, A legal tender generally means that the Seller has to accept the payment from the buyer in form of cryptocurrencies if he denies payment, he is not entitled to any payment then. But this generally happens in countries that have just one legal tender particularly their own currency, In the case of El Salvador, they don't have their own currency and have two forms of legal tender, so ideally even if a person rejects payment in BTC but is willing to accept payment in USD, he shall still be entitled to that payment. Because when both of them are legal tenders then it's just based on your convenience. Does it mean all shops are forced to accept bitcoin or shops can accept bitcoin only if they want to? Logically, it doesn't make sense for it to be the first option because not all shops will have the infrastructure to (e.g. a small convenience store or grocery shop). If it is the second option, then I doubt many shops will opt for it.
Or does it mean products in El Salador are priced in satoshis?
More importantly legal tender means that if someone pays BTC to the other person, this would be an adequate consideration in the eyes of law, therefore a contract will be established between both parties.
What does it mean for bitcoin to be legal tender in El Salvador?
Does it mean all shops are forced to accept bitcoin or shops can accept bitcoin only if they want to? Logically, it doesn't make sense for it to be the first option because not all shops will have the infrastructure to (e.g. a small convenience store or grocery shop). If it is the second option, then I doubt many shops will opt for it.
Or does it mean products in El Salador are priced in satoshis?
Does it mean all shops are forced to accept bitcoin or shops can accept bitcoin only if they want to? Logically, it doesn't make sense for it to be the first option because not all shops will have the infrastructure to (e.g. a small convenience store or grocery shop). If it is the second option, then I doubt many shops will opt for it.
Or does it mean products in El Salador are priced in satoshis?
Here is the text of the law (translated to English):
BITCOIN LAW
CHAPTER I
GENERAL DISPOSITIONS
Art. 1. The purpose of this law is to regulate bitcoin as unrestricted legal tender with liberating power, unlimited in any transaction, and to any title that public or private natural or legal persons require carrying out.
What is mentioned in the previous paragraph does not hinder the application of the Monetary Integration law.
Art. 2. The exchange rate between bitcoin and the United States dollar, subsequently USD, will be freely established by the market.
Art. 3. Prices may be expressed in bitcoin.
Art. 4. Tax contributions can be paid in bitcoin.
Art. 5. Exchanges in bitcoin will not be subject to capital gains tax, just like any legal tender.
Art. 6. For accounting purposes, the USD will be used as the reference currency.
Art. 7. Every economic agent must accept bitcoin as payment when offered to him by whoever acquires a good or service.
Art. 8. Without prejudice to the actions of the private sector, the State shall provide alternatives that allow the user to carry out transactions in bitcoin and have automatic and instant convertibility from bitcoin to USD if they wish. Furthermore, the State will promote the necessary training and mechanisms so that the population can access bitcoin transactions.
Art. 9. The limitations and operations of the alternatives of automatic and instantaneous conversion from bitcoin to USD provided by the State will be specified in the Regulations issued for this purpose.
Art. 10. The Executive Branch will create the necessary institutional structure to apply this law.
FINAL AND TRANSITIONAL PROVISIONS
Art. 11. The Central Reserve Bank and the Superintendency of the Financial System shall issue the corresponding regulations within the period mentioned in Article 16 of this law.
Art. 12. Those who, by evident and notorious fact, do not have access to the technologies that allow them to carry out transactions in bitcoin are excluded from the obligation expressed in Art. 7 of this law. The State will promote the necessary training and mechanisms so that the population can access bitcoin transactions.
Art. 13. All obligations in money expressed in USD, existing before the effective date of this law, may be paid in bitcoin.
Art. 14. Before the entry into force of this law, the State will guarantee, through the creation of a trust at the Banco de Desarrollo de El Salvador (BANDESAL), the automatic and instantaneous convertibility of bitcoin to USD necessary for the alternatives provided by the State mentioned in Art. 8.
Art. 15. This law will have a special character in its application concerning other laws that regulate the matter, repealing any provision that contradicts it.
Art. 16. This decree will take affect ninety days after its publication in the Official Gazette.
CHAPTER I
GENERAL DISPOSITIONS
Art. 1. The purpose of this law is to regulate bitcoin as unrestricted legal tender with liberating power, unlimited in any transaction, and to any title that public or private natural or legal persons require carrying out.
What is mentioned in the previous paragraph does not hinder the application of the Monetary Integration law.
Art. 2. The exchange rate between bitcoin and the United States dollar, subsequently USD, will be freely established by the market.
Art. 3. Prices may be expressed in bitcoin.
Art. 4. Tax contributions can be paid in bitcoin.
Art. 5. Exchanges in bitcoin will not be subject to capital gains tax, just like any legal tender.
Art. 6. For accounting purposes, the USD will be used as the reference currency.
Art. 7. Every economic agent must accept bitcoin as payment when offered to him by whoever acquires a good or service.
Art. 8. Without prejudice to the actions of the private sector, the State shall provide alternatives that allow the user to carry out transactions in bitcoin and have automatic and instant convertibility from bitcoin to USD if they wish. Furthermore, the State will promote the necessary training and mechanisms so that the population can access bitcoin transactions.
Art. 9. The limitations and operations of the alternatives of automatic and instantaneous conversion from bitcoin to USD provided by the State will be specified in the Regulations issued for this purpose.
Art. 10. The Executive Branch will create the necessary institutional structure to apply this law.
FINAL AND TRANSITIONAL PROVISIONS
Art. 11. The Central Reserve Bank and the Superintendency of the Financial System shall issue the corresponding regulations within the period mentioned in Article 16 of this law.
Art. 12. Those who, by evident and notorious fact, do not have access to the technologies that allow them to carry out transactions in bitcoin are excluded from the obligation expressed in Art. 7 of this law. The State will promote the necessary training and mechanisms so that the population can access bitcoin transactions.
Art. 13. All obligations in money expressed in USD, existing before the effective date of this law, may be paid in bitcoin.
Art. 14. Before the entry into force of this law, the State will guarantee, through the creation of a trust at the Banco de Desarrollo de El Salvador (BANDESAL), the automatic and instantaneous convertibility of bitcoin to USD necessary for the alternatives provided by the State mentioned in Art. 8.
Art. 15. This law will have a special character in its application concerning other laws that regulate the matter, repealing any provision that contradicts it.
Art. 16. This decree will take affect ninety days after its publication in the Official Gazette.
They're forced to accept it if the customer says so, that's what a legal tender means. ...
That's not what legal tender means. There is no law in the U.S. that requires someone to accept legal tender for payments.
There is, however, no Federal statute mandating that a private business, a person or an organization must accept currency or coins as for payment for goods and/or services. Private businesses are free to develop their own policies on whether or not to accept cash unless there is a State law which says otherwise.
In the U.S., "legal tender" generally means that it must be accepted for payment of taxes and repayment of debts. It comes from this:
Quote from: https://www.law.cornell.edu/uscode/text/31/5103
31 U.S. Code § 5103 - Legal tender
United States coins and currency (including Federal reserve notes and circulating notes of Federal reserve banks and national banks) are legal tender for all debts, public charges, taxes, and dues. Foreign gold or silver coins are not legal tender for debts.
United States coins and currency (including Federal reserve notes and circulating notes of Federal reserve banks and national banks) are legal tender for all debts, public charges, taxes, and dues. Foreign gold or silver coins are not legal tender for debts.
However, the law in El Salvador specifically states that bitcoins must be accepted for any payment (except by people who are unable to do so).
Quote
Art. 7. Every economic agent must accept bitcoin as payment when offered to him by whoever acquires a good or service.
I often hear news related to BTC payments in El Salvador, but it's lacking if you can't experience it firsthand if you don't visit there. we only receive information based on survey results that say so. so please excuse if this speculation does not match the actual situation in El Salvador.
they are free to choose to make payments with the two alternatives provided, not all buyers have BTC in their wallets. so this can be a panic so that buyers are more sensitive to these payments. where they will gradually start trying to use BTC. even then I'm not too sure.
as @BlackHatCoiner said, we should go there and experience the atmosphere firsthand at least buy a few cups of coffee and pay with BTC.
cheers
they are free to choose to make payments with the two alternatives provided, not all buyers have BTC in their wallets. so this can be a panic so that buyers are more sensitive to these payments. where they will gradually start trying to use BTC. even then I'm not too sure.
as @BlackHatCoiner said, we should go there and experience the atmosphere firsthand at least buy a few cups of coffee and pay with BTC.
cheers
edit:
ok after reading the posts below. i withdraw my original post thinking it was just about remittance.
(bad intel from people in el salvador a week ago thinking its just a remittance gimmick)
alot has changed in the last 2 days. it seems el salvador is really going full on bitcoin train.
definitely gonna book some vacation time and go there and buy some property now
ok after reading the posts below. i withdraw my original post thinking it was just about remittance.
(bad intel from people in el salvador a week ago thinking its just a remittance gimmick)
alot has changed in the last 2 days. it seems el salvador is really going full on bitcoin train.
definitely gonna book some vacation time and go there and buy some property now
...Or does it mean products in El Salador are priced in satoshis?
This is something that we need to follow but it doesn't look like it is happening soon if we are to take what was said in this article as true,Quote
“The [U.S.] dollar will continue to be the legal tender in El Salvador. Operations can be done with bitcoin – obviously related to its value in dollars,” Miguel Kattán, El Salvador’s secretary of Commerce and Investment, said in remarks covered by local newspaper El Mundo on Monday.
https://www.coindesk.com/el-salvador-commerce-secretary-bitcoin-wont-replace-dollarThere are still a lot of things to be ironed out and I bet that most citizens will take a bit of time to adjust with BTC.
I'm no lawyer, but if I understand it correctly: Yes, the merchants are pretty much forced to receive bitcoin, but they're not required to keep the BTC. They can automatically convert the BTC to USD (through whatever software they're using) if they want to stay away from the volatility.
it doesn't make sense for it to be the first option because not all shops will have the infrastructure to (e.g. a small convenience store or grocery shop). If it is the second option, then I doubt many shops will opt for it.
I've read about the government providing a specific software for the merchants, though they're not forced to use it. They can use other non-custodial wallets. 
What does it mean for bitcoin to be legal tender in El Salvador?
Does it mean all shops are forced to accept bitcoin or shops can accept bitcoin only if they want to? Logically, it doesn't make sense for it to be the first option because not all shops will have the infrastructure to (e.g. a small convenience store or grocery shop). If it is the second option, then I doubt many shops will opt for it.
Or does it mean products in El Salador are priced in satoshis?
Does it mean all shops are forced to accept bitcoin or shops can accept bitcoin only if they want to? Logically, it doesn't make sense for it to be the first option because not all shops will have the infrastructure to (e.g. a small convenience store or grocery shop). If it is the second option, then I doubt many shops will opt for it.
Or does it mean products in El Salador are priced in satoshis?
It means the currency is at the legal age which you can have a sexual relationship with.
Tender surrender babe.
They're forced to accept it if the customer says so, that's what a legal tender means. Say for example that you want to buy several cups of coffee; if you want to pay Starbucks with the LN, they can't deny it. That doesn't mean that you're also forced to pay it if you own BTC. It's the buyer's decision that's left; the sellers in El Salvador accept Bitcoin by law.
I'd really want to be in El Salvador right now, just to see how things look like. We're definitely writing history.
I'd really want to be in El Salvador right now, just to see how things look like. We're definitely writing history.
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