El Salvador has approved the Investment Banking Law, allowing investment banks to hold Bitcoin (BTC) and digital assets on their balance sheets. This legislation enables these banks to provide crypto services to sophisticated investors, akin to accredited investors in the U.S. According to Juan Carlos Reyes, president of El Salvador's Commission of Digital Assets (CNAD), the law permits private investment banks to engage in both legal tender and foreign currencies, leading to an expected influx of foreign investment and positioning the country as a financial hub. However, critics have raised concerns that the adoption of BTC benefits mainly the government and large corporations, while institutional investors are increasingly attracted to El Salvador's favorable regulatory environment for cryptocurrencies. The developments coincide with an agreement between Bolivia's central bank and CNAD to promote cryptocurrencies amid a currency crisis, highlighting the growing use of digital financial instruments in emerging economies.

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