The Legislative Assembly of El Salvador approved a measure that accepts Bitcoin as legal cash after only a few hours of deliberation.

El Salvador’s Legislative Assembly has adopted a bill submitted by President Nayib Bukele to accept Bitcoin as legal cash, with 62 votes in favor.

President Nayib Bukele declared on Twitter around 8 p.m. local time that he has introduced the “Bitcoin Law” to his legislature. The new law not only makes Bitcoin legal tender, but it also forces merchants all over El Salvador to accept it as a form of payment.

The idea was debated in the country’s Legislative Assembly just two hours after it was announced, and it was quickly passed.

“Of all the decisions we’ll make in this session, I believe this one, the Bitcoin Law, is one of the most important.” During the assembly, Congressman Chris Guevara spoke on various economic difficulties, including the country’s budget for the fiscal year 2021.

El Salvador has officially become the world’s first government to recognize Bitcoin as legal cash.

What does it imply in El Salvador that Bitcoin is now legal tender? Bitcoin is now considered “unrestricted legal money with freeing power, unlimited in any transaction, and to any title that public or private natural or legal persons require carrying out,” according to the new law.

This puts Bitcoin on par with the US dollar as a currency in El Salvador, with a requirement that all prices be represented in Bitcoin and that it be accepted throughout the country. However, there is a clause in the law that exempts distant sections of the country from having to use electronic transactions since they lack the technological capacity to do so.

Furthermore, the new rule states that the Bitcoin exchange rate would fluctuate in accordance with the free market. It also directs the Development Bank of El Salvador to establish a special trust to ensure the quick exchange of both currencies.

Financial activity in Bitcoin, such as trading, are likewise exempt from capital gains taxes, according to the law.