El Salvador has reaffirmed its commitment to Bitcoin despite pressure from the International Monetary Fund (IMF) regarding the country’s use of the digital asset.
Juan Carlos Reyes, President of the National Commission on Digital Assets (CNAD), announced on Oct. 4 that lawmakers in El Salvador had passed significant amendments to the CNAD law. These changes give the CNAD the authority to regulate Bitcoin companies in the country and establish it as the primary regulatory body overseeing the nation’s Bitcoin industry. The CNAD will also implement a risk-based regulatory framework to position El Salvador as a global leader in digital asset adoption and regulation.
Reyes emphasized that the regulatory team will combine their expertise in regulation with practical experience in Bitcoin to ensure a balanced and effective approach. He also mentioned that more details about the proposed regulatory framework will be shared in the coming weeks.
In parallel, the National Bitcoin Office (ONBTC) of the Office of the President of El Salvador highlighted that the country is developing new capital markets centered around Bitcoin. The ONBTC stated that only on Bitcoin can individuals truly self-custody their wealth and property, emphasizing the importance of sovereignty in financial transactions.
These developments come in the midst of ongoing concerns from the IMF about El Salvador’s Bitcoin initiatives. Julie Kozack, Director of the IMF Communications Department, reiterated the IMF’s recommendations to narrow the scope of the Bitcoin law, strengthen the regulatory framework, and limit public sector exposure to Bitcoin. Despite these recommendations, the IMF acknowledged that some of the risks associated with El Salvador’s Bitcoin adoption have not materialized.
While the IMF continues to express caution, members of the crypto community have advised El Salvador to stand firm in its pro-Bitcoin stance. Mathew Sigel, head of digital assets at VanEck, criticized the IMF for holding El Salvador “hostage” over its Bitcoin policies and encouraged President Nayib Bukele to stay the course, noting the remarkable transformation driven by his vision.
Overall, El Salvador’s unwavering commitment to Bitcoin amidst external pressure underscores the country’s determination to lead in digital asset adoption and regulation. Despite differing opinions, the nation’s proactive approach to embracing Bitcoin signals a bold step towards economic and societal progress.