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El Salvador Grants its First Crypto Licence to Bitfinex

El Salvador Grants its First Crypto Licence to Bitfinex

Bitfinex has achieved a milestone as the first cryptocurrency exchange to be registered as a Digital Asset Service Provider (DASP) by El Salvador’s regulators. El Salvador is a Latin American country that adopted bitcoin as legal tender in 2021, and under President Nayib Bukele’s leadership, the country has made significant investments in bitcoin and launched many BTC-related initiatives.

‘Delighted to Be the First’

Bitfinex described the authorization given to them by El Salvador’s National Digital Asset Commission as a significant achievement in its long-term strategy of bringing financial freedom and inclusion to communities and countries worldwide. Paolo Ardoino, the platform’s CTO, expressed his delight at obtaining the license, saying that it would help Bitfinex Securities facilitate the issuance and secondary trading of assets having clear-cut rights and obligations as defined by the new digital asset regulatory regime. Entities from large to small firms and governments can use the regulatory legal framework to raise capital and engage with investors who deal with digital assets.

Jesse Knutson, Head of Operations at Bitfinex Securities, revealed that since the introduction of new regulations in January 2023, there has been high demand for products that fall under the definition of the new regulations, such as tokenized shares and yield-bearing assets. “The digital asset market is a market which, at over $1 trillion in size, is still in its infancy but is growing tremendously quickly,” he added.

El Salvador’s Digital Asset Issuance Law, the country’s latest regulatory framework for crypto, supports financial innovation and the economic growth of the region, and it received a green-light from the National Congress in January 2023. The government plans to use this legislation as a springboard for regulating the operations of both retail and institutional investors.

El Salvador: the Land of Bitcoin

El Salvador, which was once known as the world’s murder capital, hit headlines in September 2021 when its government officially recognized bitcoin as a valid means of payment. President Bukele’s administration subsequently initiated several projects related to bitcoin, such as investing heavily in BTC on a macroeconomic level, building a substantial vet hospital where patients can use bitcoin to pay, creating a high-tech town, and soon to construct “Bitcoin City.” The city will be located near the volcanoes Conchagua and Tecapa and use their geothermal energy to power itself. In addition, BTC will be the primary currency, and the urban area will have a circular design that looks like the cryptocurrency’s logo from above.

Recently, President Bukele highlighted bitcoin as one of the primary reasons for the country’s increased tourism levels and fixed legacy. “We have increased tourism by 95%, and that’s in part because of bitcoin. There’s a lot of bitcoiners that want to go to the country where bitcoin is legal tender; we have bitcoin conferences,” he said.