US Rep. Raises Bill to Avert El Salvador From Adopting Bitcoin, Calling the Move a “Careless Gamble”

While there have been promising reports from the House and Senate about cryptocurrency, one congresswoman seems to predict more problems than upsides when it comes to adopting Bitcoin as an example.

U.S. Rep. Introduces Bill to Avoid El Salvador’s Bitcoin Adoption

Congresswoman Norma J. Torres, representing California’s 35th congressional district, said on April 4 that she and Congressman Rick Crawford submitted the Accountability for Cryptocurrency in El Salvador (ACES) Act to limit the risks to the United States associated with El Salvador’s adoption of Bitcoin as legal tender.

As she introduced the bill, Torres called the adoption of Bitcoin by the Central American nation “a careless gamble” in a tweet.

“El Salvador’s adoption of Bitcoin is not a thoughtful embrace of innovation but a careless gamble that is destabilizing the country. “

She further said: 

“El Salvador is an independent democracy, and we respect its right to self-govern, but the United States must have a plan in place to protect our financial systems from the risks of this decision.”

Bill to Evaluate Risks of El Salvador’s Bitcoin Adoption

The bill directs the State Department to perform an evaluation of the risks to El Salvador’s cybersecurity, economic stability, and democratic governance as a result of the country’s acceptance of Bitcoin as legal cash, as well as to devise a strategy to minimize such risks for the US financial system.

“The increasing popularity of cryptocurrencies such as Bitcoin raises concerns and necessitates a review of regulation and consumer protection in which the federal government of the U.S. should be involved,” Representative Crawford said.

El Salvador’s decision to adopt Bitcoin as a legal currency has been well accepted by the worldwide community.

Earlier this year, the International Monetary Fund (IMF) stated unequivocally that El Salvador’s choice to utilize Bitcoin was a threat to financial stability and consumer safety. It was for this reason that the IMF decided against providing further assistance to the country.

As a result, the most recent legislation is intended to ensure that El Salvador’s activities do not jeopardize American national security.

El Salvador Seeks Bitcoin Adoption Support

At the end of March, El Salvador sought assistance from cryptocurrency exchange Binance for the purpose of using bitcoin as legal tender and issuing bitcoin bonds.

The visit by Binance’s CEO was considered a statement of confidence in the Central American country’s determination to embrace digital assets. Some saw the CZ visit as an attempt by the Central American administration to save its stalled $1 billion bitcoin-backed bond issue.

The “volcano bond” refers to the El Salvador government’s ambitious intentions to harness volcanoes to generate geothermal power to mine BTC.

Leading economists and the IMF slammed the bond issue (IMF). Mr. Chandler of Bannockburn Global previously indicated that El Salvador’s move into bitcoin-backed bonds was a gimmick to lower interest rates.

But Bukele quickly dispelled rumors that Zhao’s visit was an attempt to save El Salvador’s bitcoin bond offering amid the country’s fiscal crisis.