Legislation aimed at safeguarding U.S. financial interests from El Salvador's Bitcoin Law is moving forward in Congress.
The United States is pushing forward with measures to safeguard its financial system against El Salvador's Bitcoin Law. On Monday, legislators submitted a bill requesting that the State Department lessen the dangers associated with El Salvador's acceptance of Bitcoin.
The Accountability for Cryptocurrency in El Salvador Act will be introduced alongside the Accountability for Cryptocurrency in El Salvador (ACES) Act, which was submitted in February and cleared committee last month.
Congresswoman Norma J. Torres (D-CA-35) and Congressman Rick Crawford presented the measure yesterday (R-AR-01). In a statement, Congresswoman Torres said the law was required to "defend" the United States' financial system from El Salvador's "careless gamble."
"The multiple concerns of El Salvador's adoption of Bitcoin have been examined and analyzed by global financial institutions, and the world community recognizes the potential threat," she stated.
"We recognize El Salvador's right to self-govern, but the US must have a strategy in place to protect our financial institutions from the hazards of this move, which looks to be a hasty gamble rather than a reasoned embrace of innovation."
The new law expressly requests that the State Department do an examination of El Salvador's use of Bitcoin as legal cash, as well as the country's "risks for cybersecurity, economic stability, and democratic government." The bill introduced in February is more comprehensive, requesting that the State Department examine El Salvador's regulatory environment as well as the impact of the Bitcoin Law on enterprises and residents.
El Salvador made Bitcoin, the world's largest cryptocurrency by market capitalization, legal money last year. If a company has the technological resources, it must accept the digital asset.
The country's president, Nayib Bukele, proposed the Bitcoin Law. The rule is being used by the baseball cap-wearing millennial leader to entice investors and crypto-trading digital nomads to the tiny country, which has long been one of the most dangerous in the Americas.
Bukele has even declared plans for a "Bitcoin city" in El Salvador, a tax-free refuge fueled by geothermal energy. During the November announcement, he declared, "Invest here and make all the money you want."
His ambitions, however, do not sit well with everyone. Congress in the United States wants to keep an eye on the Central American country. Senators submitted the measure in February because they believe it has the "potential to undercut US sanctions policy, strengthening hostile actors such as China and organized criminal organizations," according to congressman Jim Risch (R-Idaho).
Both the IMF and the World Bank have condemned the law, and have even pushed the government to repeal it.
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