New Law Opens the Door for Bitcoin Investment Banks
El Salvador has taken a bold leap toward becoming a global crypto finance hub with the approval of its Investment Banking Law on Thursday. The legislation separates investment banks from commercial banks, granting them the ability to hold Bitcoin (BTC) and other digital assets directly on their balance sheets.
According to Juan Carlos Reyes, president of the Commission of Digital Assets (CNAD), the move allows banks to cater exclusively to “sophisticated investors”, similar to accredited investors in the U.S. Reyes emphasized:
A Push for Institutional Growth
Supporters believe the law will attract foreign capital and position El Salvador as an emerging financial hub. Institutional investors have already been key in driving Bitcoin adoption, as the nation’s pro-crypto regulatory climate continues to attract crypto companies and financial firms worldwide.
However, critics argue that the benefits of BTC adoption remain concentrated among the government and large corporations, while ordinary citizens see limited impact on their daily lives. This ongoing debate mirrors the global divide on the benefits of institutional-led crypto adoption.
International Partnerships Fuel Expansion
In a parallel development, President Nayib Bukele recently met with Bilal Bin Saqib, Pakistan’s state minister of crypto and blockchain, to discuss nation-state-level Bitcoin adoption and energy policies for crypto mining.
This meeting underscores El Salvador’s strategy of forging alliances with other emerging economies that share its vision of crypto-led growth.
Bolivia Joins the Conversation
Beyond Asia, Bolivia’s central bank entered the crypto dialogue by signing a memorandum of understanding with CNAD on July 30. The agreement aims to promote cryptocurrency adoption as an alternative to traditional fiat systems.
Bolivia’s interest comes amid a severe currency crisis, where U.S. dollars are scarce, creating hurdles for international trade. This shortage has fueled the rise of U.S. dollar-pegged stablecoins in the region.
Stablecoins Gain Traction in Latin America
Paolo Ardoino, CEO of Tether, highlighted that the growing adoption of stablecoins in Bolivia is a direct result of the local currency crunch. For El Salvador, such developments across Latin America validate its pro-crypto policies, showing that digital assets can provide real-world solutions in times of economic strain.
With Bitcoin investment banks now officially in the picture, El Salvador could become the go-to destination for institutional crypto finance, while also shaping the future of Latin American blockchain adoption.
