Amid growing pessimism about the dollar's future, US lawmakers get concerned over the competing alternatives, such as Bitcoin. Since the US hasn't yet developed a legal framework for crypto settlements, congressmen have turned their attention to El Salvador.
Last month, senators Jim Risch (R-Idaho) and Bob Menendez (D-New Jersey), acting in a cross-party agreement, reintroduced the Accountability for Cryptocurrency in El Salvador (ACES) Act. The bill, first introduced in February last year, requires that the State Department prepare a report on El Salvador's crypto adoption and potential impact on bilateral economic relations and law enforcement cooperation between the countries.
"Using cryptocurrency as legal tender could weaken economic and financial stability and empower malign actors," said Risch, quoted in a blog post on Foreign Relation Committee's website. "Given U.S. interest on prosperity and transparency in Central America, we must seek greater clarity on how the adoption of Bitcoin as legal tender may impact El Salvador's financial and economic stability, as well as El Salvador's capacity to effectively combat money laundering and illicit finances. I'm proud to reintroduce the ACES Act to do just that" – he concluded.
El Salvador declared Bitcoin a legal tender in September 2021. The new law requires every business in the country to accept payment in BTC unless they don't have the technological means to do so. The country's president Nayib Bukele has been an avid fan of cryptocurrencies. In November 2022, he announced El Salvador would be buying Bitcoin at the rate of 1BTC per day. Unfortunately, the bold moves were made in the bullish period. When the prices slumped, things got shaky for the Salvadorean economy.