Avik Roy’s June 30 letter, written in response to our op-ed “El Salvador’s Big Bitcoin Mistake” (June 23), argues that El Salvador’s Bitcoin Law will enhance Salvadorans’ freedom of currency choice. His conclusion is unfounded and incorrect.
To draw any conclusion, Mr. Roy must know the details of the legal modalities of what governs currency choice in El Salvador, namely the Law of Monetary Integration (2000). This law, which we had a hand in drafting, effectively dollarized El Salvador. Articles 2 and 6 specify that currency competition shall prevail. Any currency that is mutually agreed upon by buyers and sellers is legal to use for all trade and contractual obligations.
Enter the Bitcoin Law of June 8. Article 7 mandates that Salvadorans must accept bitcoin if offered. This is a standard feature of forced-tender laws. It will rob those being offered bitcoin a choice and restrict the freedoms enshrined in El Salvador’s competitive currency regime.
Prof. Steve H. Hanke
Johns Hopkins University
