The price of Bitcoin rose 13% after the country of El Salvador passed a law to adopt the digital coin as legal tender.
Bitcoin’s price traded above $37,000 before falling back to $36,435.96, according to CoinDesk. The price of Bitcoin remains significantly lower than its record high of $64,829 reached in April of this year.
Lawmakers in El Salvador passed a new law that made Bitcoin legal tender. Among other things, it means prices can now be shown in Bitcoin and tax contributions can be paid with the digital currency.
Bitcoin proponents, who have long seen the digital coin as a viable alternative to fiat currencies, welcomed El Salvador’s decision. The country has also struck a partnership with digital wallet company Strike to build the country’s modern financial infrastructure using Bitcoin technology.
Other cryptocurrencies got a lift from the El Salvador news, with Ether and XRP each trading higher.
Bitcoin is known for wild price swings that have prompted critics to suggest it is not suitable to be an effective currency. El Salvador’s case will be closely watched to see how Bitcoin might work as a payment mechanism on a country-wide basis.
