US Policymakers Introduce Measure to “Mitigate Dangers” from El Salvador’s Bitcoin Law

As many know, El Salvador was the first country to recognize Bitcoin as legal tender in the country’s territory. National President Nayib Bukele is among those who believe that the policy that went into force in 2021 was historic. 

While crypto enthusiasts have continuously shown their support for this choice, not everyone was happy with these developments. In the latter category, we should mention some of the policymakers in the United States.

The “Accountability for Cryptocurrency in El Salvador (ACES Act) bill attracted the market’s attention as soon as it appeared. Congresswoman Norma J. Torres and Congressman Rick Crawford are the bill’s creators. 

The aim of this political move appears to minimize the theoretical risks of El Salvador’s new policy for the U.S..

A Recap About El Salvador’s Decision

Lawmakers in El Salvador voted in June 2021 to make cryptocurrency a legal tender in the country. In other words, residents would utilize it in place of USD to purchase all products and services. 

Congressional approval came within a day of the bill’s introduction. This approval was not shocking, considering that most of the PMs are on the side of the President. 

Financial rating agencies have raised worries regarding the volatility of the bitcoin market. Therefore, they believe that the nation is putting its citizens at risk without providing any safeguards. 

A poll found that most El Salvadorans oppose using cryptocurrency as a payment option. Over the next years, they will continue to use the U.S. dollar as their official currency.

Meanwhile, the Government has introduced several initiatives to back their decision and spread BTC’s popularity. Locals who wish to learn more about Bitcoin and the crypto world can easily find programs to do so.

A Strong Political View

There are concerns that El Salvador’s acceptance of Bitcoin might jeopardize its cybersecurity, economic stability, and democratic government. The U.S. State Department will devise policies to reduce the danger of financial instability in the United States. 

Torres claimed that the United States must protect itself from the hazards linked with El Salvador’s Bitcoin law. Also, he underlined that even an independent country could, in her view, has a negative influence on U.S. internal affairs. 

Torres recognized that El Salvador is an independent democracy and claimed to respect its right to self-governance. Regardless, she believes the U.S. should have a plan to protect the financial systems from the risks of this decision.

The Congresswoman labeled El Salvador’s political choice as a “careless gamble.” A “rushed decision” was the term that Congressman Crawford decided to use to describe the matter. 

A Sense of Déjà Vu

Earlier this year, Bukele already had to speak on behalf of its country to defend its crypto policy abroad. The U.S. Senate had previously tried to present a bill to “mitigate the risks,” and El Salvador angrily responded.

Bukele’s tweet came in response to a proposal introduced by U.S. Senators Jim Risch, Bill Cassidy, and Bob Menendez. 

As a legal currency in El Salvador, the U.S. believes Bitcoin poses dangers to cybersecurity, economic stability, and democratic governance. With this bill, the State Department will be legally able to examine these risks.

When Risch and Cassidy presented the bill for consideration, their opinion toward the cryptocurrency world was clear. The Senators claimed that Bitcoin adoption in El Salvador would attract criminal groups and allow money laundering to happen. 

According to its promoters, the ACES Act will serve as “companion legislation” to this Senate measure.

U.S. Crypto – Can Bitcoin Threaten the United States?

In light of the rising popularity of cryptocurrencies, U.S. lawmakers have issued a statement to justify their view. To summarize, they think that the regulation and consumer protections in the country should go through a review process. 

The politicians emphasized the importance of the United States’ participation in this phase. So, if the United States completes this procedure, diplomatic relations between the two countries may undoubtedly change. 

As far as El Salvador’s political leanings are concerned, Crawford’s judgment is unequivocal. El Salvador’s “hasty decision” on Bitcoin, he argues, might jeopardize the economic ties between the countries.

There are many questions Crawford hopes to answer by studying El Salvador. Policymakers in the U.S. argue that this bill represents the first step to better understanding the matter.

Bottom Line

Cryptocurrency enthusiasts worldwide hailed El Salvador’s move as one of the most significant since Bitcoin’s creation. For example, the financial industry, government officials, and foreign organizations responded adversely, in line with expectations.

The fact that El Salvador’s BTC adoption did not push other countries to follow this path should make us think. Governments likely prefer to keep a passive stance on the matter and observe El Salvador’s economic experiment.

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The U.S. bill puts more light on this decision, and Washington clearly wants to keep an eye on the situation.

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