After establishing the first Bitcoin Embassy in Switzerland, El Salvador is set to open a second Bitcoin Embassy in the state of Texas.
The venue will see governments of both jurisdictions cooperate on commercial and economic exchanges and cryptocurrency regulations.
In 2021, El Salvador became the first country to make Bitcoin a legal tender.
Announcements While Having Warnings
Despite receiving repeated warnings from the International Monetary Fund (IMF) regarding the country’s involvement with Bitcoin (BTC), the El Salvador government announced plans to open a second “Bitcoin Embassy” in Texas.
The first Bitcoin Embassy was opened in the European crypto hub, Lugano, Switzerland in October 2022.
Earlier today, El Slavador’s Ambassador to the United States, Milena Mayorga, tweeted about a meeting that took place between representatives of the country including herself, and the Deputy Secretary of the Government of Texas, Joe Esparaza.
According to Milena, both parties discussed the opening of a Bitcoin Embassy in the Lone Star state and the expansion of commercial and economic exchange between them.
The Ambassador also added that in 2022, El Salvador and the State of Texas had a commercial exchange of $1.24 billion.
In 2021, El Salvador became the first sovereign country in the world to make Bitcoin a legal tender. Under the leadership of Bitcoin maximalist President Nayib Bukele, the Central American nation is fast growing to be the global hub for the primary cryptocurrency.
The Bukele government is ever famous for regularly purchasing BTC to back the value of the nation’s fiat currency. As of now, El Salvador owns 2,381 Bitcoins worth $52.6 million, making it the third largest holder of the cryptocurrency after China and Finland.
Since then, the country has been working on implementing multiple projects powered by Bitcoin. Last month, the El Salvador legislative assembly, held in a majority by President Bukele’s Nuevas Idea (New Ideas) party, passed the landmark Digital Assets Bill which will allow the government to regulate all crypto assets other than Bitcoin as securities.
The legislation also paved the way for Bukele’s long-time plan to create the world’s first sovereign bond backed by Bitcoin, called the Volcano Bond.
The country also plans to build the “Bitcoin City”, a special economic zone (SEZ) located near the Conchagua Volcano.
The $1 billion megacity will be built in partnership with blockchain infrastructure provider Blockstream, crypto exchange Bitfinex, and several others, and will also operate the world’s first Bitcoin mining farm powered by hydrothermal energy that is derived from the volcano.
The trade-free zone will provide tax benefits to residents and incentivize business owners. El Salvador also released the Chivo Wallet, a Bitcoin wallet that allows the country’s residents and businesses to make payments or transfer BTC and US Dollars anywhere in the world. USD is the country’s official currency.
In October 2022, El Salvador opened the first Bitcoin Embassy in the Lugano province of Switzerland.
Governments of both jurisdictions signed a memorandum of understanding (MOU) to cooperate on enhancing economic relations and help spread awareness of blockchain technology and the adoption of cryptocurrencies across Europe.
In the United States, Texas has been the most pro-Bitcoin state. Texas, which has one of the top ten economies in the world, largely profited from China’s ban on Bitcoin mining in 2019.
The event set off the “Great Mining Migration” that saw many miners move their facilities to Austin, the state’s capital. In April 2022, Fort Worth, Texas became the first city government in the United States to mine Bitcoin.
Last month, as a master plan for the expansion of the blockchain industry, the Texas government introduced a bill before the state legislature that seeks to impose zero taxes on cryptocurrency purchases.
The Digital Assets bill is currently being viewed by a House Working Group to identify how it can be established in the state’s economy.
At the time of writing, Bitcoin (BTC) is trading at $22,105 – up by 1.9% in the last 24 hours. The world’s largest cryptocurrency by market cap ($426 billion) is faced with price volatility due to recent regulatory challenges faced by the crypto industry and the effects of the latest Consumer Price Index (CPI) figures released by the United States government, which shows inflation in the U.S economy grew by 0.5% from December to reach 6.4% in January.