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- The new El Salvador law allows investment banks to offer bitcoin and digital asset services to sophisticated investors with at least $ 250,000.
- Investment banks can become digital asset service providers and transmitters, operating separately from commercial banks.
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The El Salvador Legislative Assembly has approved a radical investment bank law that will create a new class of financial institutions only serving customers with high value and institutional, according to a recent press release.
El Salvador’s legislature introduced the measure last year in order to establish a private investment bank capable of managing Bitcoin transactions, with plans to diversify sources of funding for investors and allow larger deposits, loans and financial services in BTC and USD.
Supported by the Ministry of the Economy, the measure defines a regulatory framework for investment banks offering services such as asset management, financial council, structuring of business transactions, structured financing and market analysis.
Investment banks must maintain a minimum share capital of $ 50 million and operate separately from commercial banks. These institutions can request authorization to become providers of digital asset services, digital asset transmitters and Bitcoin service providers.
Legislators said this decision was aimed at attracting international private capital, financial groups and rich individuals to use El Salvador as a basis for regional operations.
The new law, sponsored by the Ministry of the Economy, limits customers to sophisticated investors, defined as individuals or entities with large market experience, the ability to obtain complex financial risks and a minimum of $ 250,000 in liquid active assets, which can be bitcoin, cash flows, thrown products, gold or money.
The framework allows investment banks to carry out various operations, such as the issue of bonds, the granting of loans, foreign currency transactions and additional services.
The new banks will be regulated by the Central Reserve Bank (BCR), which will establish capital, liquidity, risk management and digital asset operations. Financial system monitoring (SSF) will oversee compliance, transparency and investor protection.
Dania González, member of the El Salvador Legislative Assembly, said the investment bank is essential to help governments, businesses and institutions increase capital for major projects.
The law should generate substantial advantages, to attract foreign capital, international financial groups and high shuttle individuals to position El Salvador as a regional financial center.
“We are transforming El Salvador into a specialized financial center, generating an international reputation, institutional confidence and competitiveness,” noted González.
Legislative development comes after the National Bitcoin Office (ONBTC) reported earlier this week that Bitcoin banks came to Salvador.
It is a story in development. Please come back for new updates.
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