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El Salvador Doubles Down on Bitcoin with Proposal for Private Investment Bank

El Salvador proposes a new private investment bank to cater to bitcoin investors, aiming to boost economic growth and attract crypto investments.


El Salvador proposes a new private investment bank to cater to bitcoin investors, aiming to boost economic growth and attract crypto investments.
Credit: Foretoken Media 2024

SAN SALVADOR, SV – El Salvador is doubling down on its bitcoin bet with a new proposal to establish a private investment bank catering to cryptocurrency investors. Milena Mayorga, El Salvador's Ambassador to the United States, announced the plan on X, stating that the Bank for Private Investment (BPI) would "diversify the financing options offered to potential investors in dollars and Bitcoin."


President Bukele's Pro-Bitcoin Agenda


The move comes just two weeks after President Nayib Bukele, a vocal bitcoin supporter, was sworn in for his second term. Bukele's senior Bitcoin advisor, Max Keiser, said the president is "hitting the ground running" with this new legislation.


If approved, the BPI would offer bitcoin investors access to financial services with fewer restrictions compared to traditional banks. The bank would not face the same stringent laws, such as limitations on engaging with overseas banks or granting large loans. This could significantly streamline the investment process for those looking to leverage bitcoin and other cryptocurrencies.


To establish a BPI, a minimum share capital of $50 million and at least two shareholders, including foreigners, would be required. The bank would be able to operate in any legal tender, including USD and BTC, and could seek approval to become digital asset service providers.


Legislative Process and Historical Context


The proposal, directed by Bukele and put forth by Minister of Economy María Luisa Hayem, has not yet been approved by legislators. It will need to go through consultations and a vote in the Technology, Tourism, and Investment Commission.


El Salvador made history in 2021 by becoming the first country to make bitcoin legal tender. Despite a bumpy ride, Bukele's popularity remains high, largely due to his crackdown on criminal gangs that plagued the nation for decades.


The BPI proposal represents another step in El Salvador's mission to integrate bitcoin into its financial system and attract crypto investment to boost economic growth. By providing more flexible financial services, the BPI aims to draw in both domestic and international investors, potentially transforming El Salvador into a hub for cryptocurrency innovation.

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