Opposition mps call for reforms to regulate bitcoin exchanges in El Salvador

Key facts:
  • Anabel Belloso and Dina Argueta ask to amend three articles of the Law against money laundering.

  • They believe that this reform will dispel the uncertainty and concern of the population on this issue.

Representatives Anabel Belloso and Dina Argueta, of the FMLN Parliamentary Group, who oppose the government of El Salvador’s President, Nayib Bukele, asked to reform the Law against the laundering of money and other assets. They propose that the country’s bitcoin exchanges be subject to obligation, and report all transactions that exceed the equivalent of USD 10 thousand.

Parliamentarian Anabel Belloso was the spokesperson for this proposal, which was widespread on June 23, 2021 through a video posted on the newspaper’s Twitter account world of the Central American nation.

In a clip that lasts more than a minute, the legislator mentioned the reform proposals that they are applying for three articles of the aforementioned lawsanctioned in 2018. Specifically, he referred to Article 2, which would be amended to include the subjects who are obliged to comply with this regulation. Would thus include both exchange houses or exchanges where transactions are made with bitcoin, together with legal platforms of lawyers (an emerging phenomenon in the country that helps generate business).

In this regard, Belloso recalled Article 4 of this regulation, which establishes that those who have participated in criminal activities to hide or cover their illicit origin “will be punished with imprisonment of 15 years and a fine of 50 to 2,500 current minimum monthly wages for commerce, industry and services at the time the corresponding sentence is issued.”

The legal text also states that money-and asset-laundering shall mean any operation, transaction, action or omission aimed at concealing illicit origin and legalizing property and securities derived from criminal activities committed inside or outside the country.

Belloso pointed out that in the case of Article 9 of the aforementioned Law, the proposal seeks to make modifications so that the obligated entities that are listed in Article 2, report all transactions in bitcoin.

As the Law already states that they must be reported to the corresponding those transactions greater than USD 10 thousand, what is being incorporated is the obligation to report transactions equivalent to this amount that are made using cryptocurrency or any cryptoactive, although in this specific case they refer to bitcoin.

These are the three specific reforms within this regulatory framework to remove that uncertainty and concern that is in the feelings of the population and about the possibilities of money laundering through this form of transaction.

Deputy Anabel Belloso of the FMLN Parliamentary Group.

Belloso recalled that on June 23 in the company of congresswoman Anabel Arguetta presented this written request through which they propose reforms to the Law Against Money Laundering so that bitcoin exchanges are subject to this law and report all the transactions they make. Source: The World Newspaper / twitter.com

Belloso added that it is necessary to modify other legal frameworks that accompany this initiative. “I believe that they did not take into account many regulations when approving the ‘madrugón express’ (Bitcoin Law), nor do they know what implications relative to other laws the new Law has.”

The reactions of Salvadoran tweeps

Followers of the news on Twitter published their responses to the proposals of the parliamentarians. The user of the social network identified as Oswaldo B, say the following: “The problem is that the one who has the BTC is not obliged to justify its origin.”

In the same thread the twitterer under the pseudonym of The Political Scientist le answer: “Bitcoin is no longer as effective for hackers. The FBI has recovered millions of dollars from a recent ransomware attack.”

For his part, e follower Nicolight Copernight stress: “Why do they send ignorant people to make such requests about transactions of a currency that can be verified from a phone openly?». Oswaldo B respond: “Neither the deputies who approved this nor those who oppose it have the slightest idea of how it works.”

On June 17 of this year, the same Belloso and Argueta presented a reform to eliminate bitcoin as a legal currency in El Salvador, considering that adoption of cryptocurrency endangers economic system and family finances.

As CriptoNoticias reported on that occasion, the legislators questioned the” enforceability ” expressed by the new law on the use of bitcoin to pay for products or services. For congressmen, the Bitcoin Law was drafted without consultation and adopted in an accelerated manner, without the necessary debates.

Days later, it became known that this request did not have the support of the deputies representing the Nationalist Alliance party (Arena), in the Legislative Assembly of El Salvador. In this regard, Congressman Numan Salgado of the Grand Alliance for National Unity (Gana), an allied party of the ruling party, said that Arena and the Farabundo Martí National Liberation Front (FMLN) were asking changes or repeal of the aforementioned law because they seek to generate uncertainty and fear in the citizens of El Salvador.

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