In the United States, a Senate bill aimed at mitigating the dangers associated with El Salvador’s adoption of bitcoin as legal cash has proceeded. “With El Salvador having recognized bitcoin as legal cash, it is vital that we limit threats to our financial system,” one of the bill’s sponsors stated.
Senate Committee Approves Bill to Mitigate Risks of Bitcoin Being Legal Tender in El Salvador
The Senate Foreign Relations Committee (SFRC) of the United States of America has advanced the “Accountability for Cryptocurrency in El Salvador Act,” or “ACES Act.” Senators Jim Risch (R-Idaho), Bob Menendez (D-New Jersey), and Bill Cassidy (R-Louisiana) proposed the bill on Feb. 16. (R-La.). It intends to limit the dangers associated with El Salvador’s legalization of bitcoin.
Senator Risch, the SFRC’s ranking member, tweeted Wednesday:
As El Salvador has adopted bitcoin as legal tender, it’s critical we mitigate risks to our financial system.
“The legislation passed by SFRC today requires federal agencies to examine risks, including potential empowerment of bad actors & organized crime,” he said.
The proposed legislation compels the State Department to submit a report on El Salvador’s use of bitcoin as legal money, as well as a plan to mitigate possible financial system vulnerabilities in the United States. The report would analyze El Salvador’s bitcoin legislation and the implications for cybersecurity, economic stability, and democratic government.
In September of last year, El Salvador embraced bitcoin as a national currency alongside the US dollar. Since then, the country has acquired a total of 1,801 BTC.
Salvadoran President Nayib Bukele tweeted in response to the Senate committee’s passage of the bill:
Never in my wildest dreams would I have thought that the US government would be afraid of what we are doing here.
He continued in a subsequent tweet, “The US government does not stand for liberty, and that is a confirmed reality.” As a result, we shall fight for liberty. “Let the game begin.”
Senator Bill Cassidy reacted to Bukele’s freedom-related tweet. “Salvadoran residents in the United States do not approve of this approach,” he wrote. We are addressing their concerns. Perhaps they lack trust in a president who boasts about ‘naked’ bitcoin trading.”
The United States is not alone in its concern about El Salvador’s bitcoin law. Andrew Bailey, Governor of the Bank of England (BOE), expressed worry last November about bitcoin being used as legal cash in El Salvador.
Additionally, the International Monetary Fund (IMF) has pushed the country to discontinue using bitcoin as legal cash on multiple occasions. The IMF estimates that the expenses of converting BTC to legal money outweigh the potential advantages.
El Salvador, on the other hand, sees no cause to amend its bitcoin law. Indeed, President Bukele has forecast that two further nations will legalize BTC this year.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.