El Salvador plans to open second Bitcoin embassy in Texas

24 Feb El Salvador plans to open second Bitcoin embassy in Texas

El Salvador’s ambassador to the United States, Milena Mayorga announced the country’s second Bitcoin embassy, ​​planned for the state of Texas. El Salvador leads the world in Bitcoin adoption, opening the first Bitcoin embassy in Lugano, Switzerland last October.

El Salvador’s historic commitment to Bitcoin remains firm

After opening her first Bitcoin embassy in Lugano, Switzerland, Milena Mayorga, the ambassador of the Central American nation of El Salvador to the United States, met last week with Texas Deputy Secretary of State Joe Esparza to discuss the creation of her second Bitcoin embassy. , in Texas.

What do Lugano, Texas and El Salvador have in common? A deep interest in the opportunities that Bitcoin provides for economic growth and financial freedom.

El Salvador in particular has made history with a series of highly publicized announcements surrounding the recent adoption of Bitcoin legal tender in 2021 and has continued to push Bitcoin initiatives both within the country and abroad. As if to clean up its status as a Bitcoin country, it opened a government-run Bitcoin office last November, as an official arm of the Salvadoran government. Its role is to facilitate Bitcoin adoption, plan strategy and policy, and assist Bitcoin businesses that wish to come to El Salvador to take advantage of the Bitcoin Law.

The country has also recently passed a new digital securities law, which provides a regulatory framework for the issuance of crypto tokens, paving the way for offerings of digital securities.

Most famously, the Digital Securities Act paves the way for El Salvador’s planned Volcano token, a tokenized security bond offering that harnesses the nation’s geothermal energy to mine Bitcoin.

The Volcano token has been proposed to raise a billion dollars to pay off the nation’s national debt and fund the creation of the planned Bitcoin City, a special economic zone that will offer tax breaks and incentives for Bitcoin entrepreneurs planning to establish a presence in El Salvador .

El Salvador made headlines again, last year, by announcing the opening of its first Bitcoin embassy in the Swiss city of Lugano. Representatives from Lugano signed a Memorandum of Understanding with the Central American nation, agreeing to collaborate on education and research around Bitcoin adoption.

Now, this past week, Ambassador Mayorga has announced the opening of a second Bitcoin office, this time in the state of Texas, which has been a leading proponent of Bitcoin and crypto-friendly regulation in the US, and is the center of the US Bitcoin mining industry.

What exactly is a Bitcoin Embassy?

El Salvador’s two Bitcoin embassies are part of the template for adoption that it has been working to create, so other places that want to adopt Bitcoin can do so seamlessly. This template is part of El Salvador’s President Nayib Bukele’s larger vision for El Salvador in its role as a leader of Bitcoin adoption on the global stage, and will act as a blueprint for other nations or jurisdictions to follow in El Salvador’s footsteps.

The Bitcoin embassies themselves can be seen as the first ever Bitcoin chambers of commerce, and El Salvador’s strategic placement of these embassies demonstrates President Bukele’s desire to create forward-looking policies, friendly regulations, and establish trade links with key financial centers that have an interest in Bitcoin adoption.

The state of Texas and El Salvador have extensive trade between them totaling more than one and a quarter billion dollars by 2022. Texas is also the hub of the US Bitcoin mining industry, which saw a huge influx of businesses looking to take advantage of the low energy costs in Texas and set up shop after China’s Bitcoin mining ban in 2021.

Previously, China led the global Bitcoin mining industry with ⅔ of global hash power previously located in the Asian nation, until the ban. Since China’s ban went into effect, many miners have set up shop in Texas and elsewhere around the US with cheap renewable or waste energy that can be salvaged and used for mining. The US now leads the world in Bitcoin mining.

El Salvador plans to invest in mining infrastructure, both for the Volcano token, as well as inviting mining companies to open mining operations in the country, so the announcement of its second Bitcoin embassy in Texas makes sense. It remains to be seen whether American mining companies will expand their operations to El Salvador, but the Bitcoin Embassy in Texas may motivate them in the near future.

In Lugano, the opening of El Salvador’s first Bitcoin Embassy coincided with the Tether-sponsored “Plan B” conference that took place following the decision by Lugano local authorities to adopt Bitcoin, USDt and Lugano’s own LGVA token as “DeFacto Legal Tender”. Any of the three cryptocurrencies are now accepted at a variety of businesses across the city and can be used to pay for taxes, fees and fines issued by the city.

El Salvador’s Bitcoin Embassy has also appointed a Salvadoran official who will work closely with Lugano representatives to establish economic relations between El Salvador and the city of Lugano, and share insights and research to facilitate adoption globally.

What do Bitcoin Embassies mean for Bitcoin?

El Salvador’s decision to adopt Bitcoin as legal tender was the first shot fired in a high-stakes game to disrupt the old economic order. Institutions such as the IMF and the World Bank, which until now have had a monopoly on distributing multilateral financing facilities or development projects to nation-states, are now being challenged by a decentralized, borderless, global digital currency such as Bitcoin, for the first time.

Developing nations that have had to rely on funding from these global financial institutions have sometimes found themselves at the mercy of foreign influence on their domestic economic policies, and have had to face sometimes very tough conditions to receive funding.

President Bukele was one of the first leaders to truly understand the value proposition of Bitcoin and sought to adopt it to improve the lives of the average Salvadoran citizen. The results of adoption so far have been nothing short of incredible, although they have been consistently portrayed in a negative light by much of the mainstream media.

Regardless, other nations and jurisdictions have not turned a blind eye to El Salvador’s Bitcoin success story, which has resulted in a huge increase in tourism, a massive influx of Bitcoin related industry, and a complete rebranding of the nation’s reputation as a dangerous gang. loaded, third world country, to the global center of a new, fairer freedom-focused financial system based around Bitcoin.

The success in El Salvador is even more remarkable, as it has taken place throughout the bear market and crypto winter of the past two years. This success has other places looking to adopt Bitcoin eager to duplicate the El Salvador model in their own states, nations and legal jurisdictions. El Salvador’s Bitcoin Embassies were created to play a central role in exporting this success worldwide.

While this state-level adoption by governments is not how early Bitcoiners envisioned global Bitcoin adoption to play out, it has certainly advanced the level of Bitcoin adoption to new heights that no one thought possible in such a short period of time. That said, the question remains, is this good or bad for Bitcoin?

The answer to this question depends on how you look at Bitcoin.

For a die-hard anarcho-capitalist libertarian-minded Bitcoiner who wants to see the dissolution of the state, this may not be a desired outcome.

But from the point of view of a Salvadoran who may suffer from unfair access to financial services, Bitcoin offers tempting solutions.

They now have a way to save, shop and sell online, make and accept digital payments in stores, and can now participate in the wider global economy. Bitcoin companies offer high-paying job opportunities and hire Salvadorans. Bukele’s firm grip on crime, while criticized abroad, has earned him the loyalty and devotion of millions of Salvadorans who can now walk the streets at night without living in fear.

Foreigners are no longer afraid to come to El Salvador to spend their Satoshis and Dollars. They eat in Salvadoran restaurants, stay in Salvadoran hotels and drink in Salvadoran bars. They move there in droves, buy and rent property, and start their own businesses and contribute to the local economy.

It has been a very welcome change, which has been described as night and day, and none of it would have happened without Bitcoin. So, is it good or bad? You are the judge.