The US administration may not be pleased with the way El Salvador’s president, Nayib Bukele, is governing the country, and it wants him to be cautious in how his country adopts and uses Bitcoin now that it is legal tender.
After relinquishing its currency, the colon, El Salvador now utilizes the US dollar as legal cash. The legal status of Bitcoin, which is now circulating on par with the dollar in El Salvador, provides a possible wrinkle in the global financial arena.
Unlike El Salvador, the United States is wary about Bitcoin and other cryptocurrencies. Authorities in the United States are concerned about a variety of issues, including environmental effects, terrorist funding, market manipulation, and the risk that cryptocurrencies would cause the United States to lose geopolitical leverage by reducing the dollar’s influence.
El Salvador, on the other hand, could be pushed differently from the United States by several variables. First, the threat of sanctions as a result of the country’s shift toward a more authoritarian administration would allow Salvadorans to receive their important remittances in an uncensored manner.
Similarly, making Bitcoin legal tender will expose the government to foreign capital willing to invest and grow enterprises in the country.