Regulated Bitcoin (BTC) investment banks are set to enter El Salvador, following the approval of the El Salvador Investment Banking Law on Thursday, which classifies investment banks under a regulatory framework distinct from commercial banks.
El Salvador's Digital Assets Commission (CNAD) Chairman Juan Carlos Reyes told Cointelegraph that investment banks will now be allowed to hold BTC and other digital assets on their balance sheets and provide cryptocurrency services to "mature" investors (equivalent to qualified investors in the U.S.). CNAD is the country's cryptocurrency regulatory body. He added:
Supporters of the newly passed law state that it encourages foreign investment in El Salvador and positions the country as an emerging financial center.
Institutional investors have been a major driving force behind El Salvador's cryptocurrency adoption, as this Central American nation attracts cryptocurrency and financial companies with its supportive regulatory environment.
However, critics argue that the country's BTC adoption and regulatory policies have not benefited ordinary people, with the main beneficiaries being the government and large corporations.
El Salvador President Nayib Bukele met with Pakistan's Minister of State for Cryptocurrency and Blockchain Bilal Bin Saqib to share national-level Bitcoin adoption strategies and promote energy policies for cryptocurrency mining.
"The cooperation is essentially based on how both emerging economies under the International Monetary Fund projects can leverage technology and other financial tools for national growth," Bin Saqib said in an interview with Cointelegraph.
On July 30, the Central Bank of Bolivia signed a memorandum of understanding with CNAD to promote the use of cryptocurrency as an alternative to traditional fiat currency.
The agreement was reached during Bolivia's currency crisis, where the scarcity and difficulty of obtaining U.S. dollars made international trade challenging.
According to Tether CEO Paolo Ardoino, this has led to an increasing use of dollar-pegged stablecoins as a medium of exchange.
Related: White House: Trump to Allow U.S. 401(k) Retirement Plans to Invest in Cryptocurrency
Original article: “Government Regulators: Bitcoin (BTC) Investment Banks Coming to El Salvador”
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