El Salvador Passes Bill to Guide All Cryptocurrencies

El Salvador, the first country to make Bitcoin (BTC) a legal tender, has expanded its stance on cryptocurrencies with the introduction of a legalization bill. Interestingly, this new bill which aims to ensure legal protection and issuances of debt with cryptocurrencies will induce the flow for the launch of BTC bonds known as ‘Volcano Bonds’. 

According to the National Bitcoin Office (ONBTC) of El Salvador which was inaugurated last year, the bill has already been passed. The bill scaled through with 62 votes in its favor and another 16 against its implementation. For now, it is only awaiting ratification and approval by Nayib Bukele, the president of the Latin American country who has also tweeted about the new digital securities law.

“Today El Salvador builds on our first-mover advantage by passing landmark legislation establishing a legal framework for all digital assets that are not bitcoin. As well as those issued on bitcoin. The law also paves the way for volcano bonds which we will soon begin issuing,” ONBTC tweeted.

“With the passing of this digital securities law, El Salvador will offer unprecedented consumer protection from bad actors in the ‘crypto’ space while also firmly establishing that we are open for business to all those who wish to build the future with us on bitcoin.”

The Set up of the National Digital Assets Commission

El Salvador is considering paying off sovereign debt and financing the construction of the proposed Bitcoin City with the Volcano Bonds. This bill was first announced in November 2022 by Maria Luisa Hayem Brevé, the Minister of Economy for El Salvador. At the time, Paolo Ardoino, Chief Technology Officer (CTO) of cryptocurrency exchange Bitfinex said,

“Digital securities law will enable El Salvador to be the financial center of central and south America.”

Notably, El Salvador plans to issue Bitfinex with a license that would allow it to list the bond issuance. Alongside the introduction of the bill, a regulatory agency known as National Digital Assets Commission will be launched. This agency will be responsible for customer protection as well as protecting the rights of digital assets service providers in El Salvador. 

The National Digital Assets Commission will ensure that scammers and other bad actors are prevented from operating in the region.