This week top 5 articles 📌
Bitcoin is now a legal currency in El Salvador, while other government officials hint at similar bills. At the same time, Bitcoin’s institutional adoption continues amid crypto companies beating record-funding amounts. Find out more about the top crypto news of the week.
El Salvador turns Bitcoin into a legal currency.
El Salvadorian President, Nayib Bukele, claimed history was made after his bill to turn Bitcoin into a legal tender in the country gained a supermajority vote in parliament. El Salvador became the first country in the world to make Bitcoin a legal currency on par with the US Dollar, improving the cost and easiness of remittances between emigrants and El Salvadorian residents. The decision propelled many other congresspeople and government officials in Latin American countries to hint at similar paths down the road and to develop Bitcoin-related projects.
Is Paraguay the next country to adopt Bitcoin?
Paraguayan Congressman, Carlos Rejala, will introduce a bill to make Paraguay the newest crypto hub in Latin America. The congressman wants to first “give Paraguay a Blockchain-friendly status“ and then introduce a new bill to make Bitcoin a legal tender in the country.
The current project aims to attract crypto companies to invest in operations in the country while highlighting its attractiveness for mining and investors from a tax standpoint.
Institutional adoption first, governments and officials next?
After El Salvador’s announcement, congresspeople in other Latin American countries hinted at moving forward with more bills concerning Bitcoin. Moreover, other personalities linked to the US administration as Biden’s top tech antitrust advisor disclosed personal Bitcoin holdings between $1 and $5 million. This new wave of official and governmental-linked personalities comes after companies started purchasing Bitcoin and digital assets to their reserves.
BIS proposes a new framework for the treatment of digital assets.
As more institutions and retail investors look at digital assets, banks and financial institutions may need to adapt to new regulations to serve their customers. In a new paper, The Bank of International Settlements gives new guidance on the treatment of digital assets by financial institutions amid more institutional and governmental interest. The Bank’s Basel Committee proposed to divide the treatment of exposure to digital assets into two groups. Currencies like reserved-backed stablecoins and “tokenized traditional assets“ can work under the same rules and frameworks as other traditional assets (e.g., bonds, equities). On the other side, banks would need to add further reserves when dealing with Bitcoin and other cryptocurrencies.
The quest for a decentralized Internet gains fuel.
Projects raising high funding amounts as Solana are creating new ecosystems, tackling the Smart Contracts’ dependence on Ethereum while others plan to transform the Blockchain itself. The quest to build the metaverse, Web 3, or the decentralized internet is ramping up with other projects such as Dfinity and Filecoin, building the infrastructure for a decentralized future for consumers and institutions. The main goal of Web 3 is to create a native ecosystem of decentralized applications, giving more freedom to consumers while offsetting the monopoly of online centralized conglomerates.
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