El SalvadorEl Salvador, the first country in the world to accept Bitcoin as legal cash, plans to open a “Bitcoin embassy” in Texas, according to a tweet by the country’s U.S. ambassador on Wednesday. This effort follows a similar one launched in Switzerland the last year to promote the usage of cryptocurrencies. Bitcoin, the largest digital currency in the world, is connecting more nations, in this case, El Salvador and the United States.
El Salvador connects the globe through BTC
Mayorga referred to Texas as a “new ally” and said that she had met with Joe Esparza, the Deputy Secretary of the Government of Texas, to discuss the creation of the Bitcoin office and the expansion of commercial and exchange operations. The state of Texas hosts numerous Bitcoin mining operations.
In my meeting with the assistant secretary of the government of Texas, Joe Esparza, we discussed the opening of the second Bitcoin Embassy and the expansion of commercial and economic exchange projects.
Milena Mayorga
The Central American country established a “Bitcoin office” in Lugano, Switzerland, in October 2022 to support “initiatives to drive the adoption of Bitcoin and other cryptocurrencies across their respective regions.” Additionally, it was set to foster “the exchange of students and talents between El Salvador and Lugano,” the countries said at the time.
The International Monetary Fund and other financial institutions have criticized El Salvadoran President Nayib Bukele’s Bitcoin scheme. Bitcoin plunged 15% in the hours following the passage of legislation making it legal tender and has since dropped over 50%.
The foreseeable impacts of the Bitcoin Embassy
According to former Blockstream chief strategy officer Samson Mow, the phenomenon of the Bitcoin embassy is the next stage in nation-states and localities adopting Bitcoin. He added that such activities entail international cooperation to generate new projects, such as forming alliances amongst places that have adopted Bitcoin.
The announcement comes as Texas lawmakers are allegedly mulling a new bill that would create a “master plan for the expansion of the blockchain industry.” The legislation plan wants to make Texas the country’s crypto capital by, among other things, allowing tax-free Bitcoin purchases.
As previously reported, Texas has emerged as one of the crypto-friendly U.S. states, implementing crypto-friendly laws aiming to better adapt business laws to blockchain innovation and digital asset regulations. Texas is also home to some of North America’s top Bitcoin miners, with significant mining businesses like Riot Blockchain, Core Scientific, and Genesis Digital Assets based there.
The IMF warns El Salvador on BTC exposure
Following a visit to El Salvador, the International Monetary Fund (IMF) recommended that the country reconsider its plans to enhance Bitcoin exposure. The community responded to the IMF’s proposal with multiple messages criticizing the agency.
Various crypto community members took to social media to share their opinions on the IMF’s efforts to discourage El Salvador’s ambitions for Bitcoin. They ranged from rejecting it as a simple case of spreading fear, uncertainty, and doubt, or “FUD,” to viewing it as a significant bullish signal for BTC.
One community member suggested in a tweet that the IMF’s action is intended to “scare other countries away” from El Salvador’s example. Additionally, the Twitter user pushed others to adopt Bitcoin and assist in shutting down central banks. They posted:
Many nations are becoming more Bitcoin-friendly as a result of El Salvador’s resiliency in the face of an unforgiving bear market. For example, on November 29, 2022, the Brazilian Chamber of Deputies legalized crypto as a payment method.
The Brazilian president signed the bill on December 22, and it is anticipated that it will become law by the end of the third quarter of 2023. In contrast to El Salvador, the law does not make Bitcoin and other cryptocurrencies legal tender in the country, but they will be recognized as a form of payment.
In the meantime, another community member commented on the issue, highlighting the IMF’s contradictions. According to Bitcoin Xoe, for instance, the IMF has admitted that El Salvador’s GDP is expected to rise faster than the historical average. Yet, despite this, the organization advised abandoning Bitcoin due to economic dangers.
Yet another Twitter user referred to the IMF’s initiatives as “FUD.” The community member feels that Bitcoin will continue to advance despite the IMF’s recommendation. A community member, however, suggested that this is a strong Bitcoin bull indicator. According to the community member, the IMF is losing its grip on the developing world.
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