US increases political pressure on El Salvador amid Bitcoin plans

The US now appears to be increasing pressure on El Salvador as the country pushes its plans to introduce Bitcoin (BTC) as legal tender alongside the US dollar.

US increases political pressure on El Salvador amid Bitcoin plans

Tensions are mounting between El Salvador President Nayib Bukele and Joe Biden’s administration in the United States, and Victoria Nuland, Under-Secretary of State for American Political Affairs, visited Bukele yesterday for face-to-face talks.

While Reuters reports that Nuland has expressed “hope” that El Salvador and the International Monetary Fund (unsatisfied with El Salvador’s Bitcoin plans) will close the deal “following the country’s impressive move to make Bitcoin legal tender.” local news outlets have a less optimistic view of the summit.

Julie Chung, Assistant Secretary of State for Foreign Affairs of the Western Hemisphere, accompanied Nuland, who had previously warned of the Bukele government’s actions against China in the run-up to the summit.

Beijing was soon giving financial aid to El Salvador, a fact that worried Washington.

Nuland also warned Bukele to look out for an upcoming list that the United States will publish in the coming days that will, according to ElSalvador.com, “contain the names of Salvadoran officials involved in corruption.” The officials added, “There will be sanctions if you lose your US visa for at least three years.”

Before the meeting, Bukele dismissed the list, calling it “political”.

However, Nuland was also deeply dismayed to learn that threats from the United States had so far been ignored and that a number of what the local media attributed to the designated Bukele supporters served as a judge at the Salvadorian Supreme Court prior to her visit.

According to Elsalvador.com, Congress has sworn in five new Supreme Court justices, with the group’s new leadership coming from the same group of pro-Bukele attorneys who successfully dismissed Constitutional Court judges earlier this year.

The new judges will preside over the Supreme Court until 2030 – a practice that critics say Bukele now has similar control over all government agencies.

US increases political pressure on El Salvador, but Bitcoin plans keep pushing

Bukele’s government is pushing for infrastructure plans that will take just over two months before the country welcomes BTC as legal tender. According to La Prensa Grafica, Finance Minister Alejandro Zelaya has expanded the government’s plan to set up two payment platforms and a state-issued cryptocurrency wallet.

Two versions of Chivo, B2B and B2C, have been developed and the CFO claims the former will become “attractive” to trade.

Aside from promising to guarantee commission payments, Zelaya doesn’t go into the benefits of using the app, but rather teases:

“We had to design a B2B wallet in such a way that it is attractive within the company, otherwise nobody would use it.”

But Bukele has also been criticized by those who argue that the government awards contracts directly to app developers rather than organizing a transparent public tender process. Bukele hasn’t publicly revealed which company is developing the app, but many expect the U.S. BTC company Strike to be involved in some way.

ElSalvador.com said the move is reminiscent of the government’s move in 2010 to transfer an electronic public transport payment contract to Latin American giant Sistema Único de Boletos Electrónicos (Subes). The government mentioned as the FMLN regulator has many flaws. The FMLN has since fallen dramatically out of favor and is now one of the smallest parties in parliament. Three of the four MPs have tabled two separate bids to derail the new law.

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