El Salvador approves Bitcoin as legal tender
- El Salvador became the first country in the world to adopt bitcoin as legal tender
- In practice, El Salvador does not have its own currency.
- The country was officially ‘dollarized’ in 2001 and runs on the monetary policy of the US Federal Reserve
- It is a type of cryptocurrency
- Cryptocurrency is a specific type of virtual currency, which is decentralized and protected by cryptographic encryption techniques.
- Bitcoin was introduced in 2009 after Global Financial Crisis .2007/08.
- Ex. of cryptocurrency -- Bitcoin, Ethereum, Ripple etc.
- Bitcoin is based on an open-source protocol and is not issued by any central authority.
- Bitcoin is generated by a process called MIning which is done by solving a difficult mathematical puzzle.
- All the transactions made in a publicly available, open ledger, in an anonymous and an encrypted form called a blockchain.
- Blockchain is a shared, immutable ledger that facilitates the process of recording transactions and tracking assets in a business network