Bitcoin News Today: El Salvador Legalizes Bitcoin-Centric Investment Banks With $50M Minimum Capital Requirement

El Salvador has advanced its digital asset ambitions with the passage of the Investment Bank Law, which allows banks to operate entirely as Bitcoin-focused institutions, exclusively serving accredited and sophisticated investors. The law differentiates these investment banks from traditional commercial banks, granting them the authority to issue bonds, provide loans, and facilitate digital asset transactions—using national or foreign currencies, including Bitcoin [1]. The initiative aims to attract institutional and high-net-worth investors by offering a regulated environment for complex financial activities.

Under the new regulatory framework, banks must meet a minimum capital requirement of $50 million and provide services only to investors with at least $250,000 in liquid assets and a demonstrated understanding of investment risks. This ensures that only qualified participants engage in high-risk digital asset transactions, aligning with the government’s broader strategy to position El Salvador as a regional hub for crypto finance [2]. The move also reinforces the country’s 2021 decision to adopt Bitcoin as legal tender, now expanding its role into institutional banking.

Juan Carlos Reyes, head of El Salvador’s Commission of Digital Assets, confirmed that banks licensed as Digital Asset Service Providers (PSADs) can now operate as Bitcoin banks, enhancing the country’s crypto ecosystem within a regulated setting. These banks are expected to play a pivotal role in advancing infrastructure and technology projects through foreign capital inflows [3].

Dania González, a government official, emphasized that the law creates a legal and financial infrastructure to attract international investment. By separating investment banking from commercial banking, the government seeks to insulate the general population from the volatility associated with Bitcoin while fostering innovation in the digital asset space [4]. The initiative is part of a broader national strategy that includes the Chivo wallet, government-held Bitcoin reserves, and geothermal-powered mining operations.

The new law also mandates that Bitcoin banks implement robust risk management protocols and maintain operational independence from traditional financial institutions. This is intended to protect both the banks and their clients while ensuring compliance with regulatory standards. Analysts have noted that such a structure could enhance institutional confidence in the market, though any long-term economic benefits remain speculative [5].

As El Salvador continues to build its digital asset infrastructure, the country’s Bitcoin reserves have reached $767 million. Final licensing criteria and operational guidelines for Bitcoin banks are expected to be finalized in the coming months. This regulatory development marks a significant step in the global adoption of institutional-level Bitcoin banking and may influence other nations considering similar strategies.

Sources:

[1] Cointribune. (2025). El Salvador Paves the Way for Bitcoin Investment Banks. https://www.cointribune.com/en/el-salvador-paves-the-way-for-bitcoin-investment-banks/

[2] AInvest. (2025). El Salvador Approves Bitcoin-Centric Investment Banks to Boost Digital Asset Adoption. https://www.ainvest.com/news/bitcoin-news-today-el-salvador-approves-bitcoin-centric-investment-banks-boost-digital-asset-adoption-2508/

[3] Mitrade. (2025). Bitcoin Nears $120000 Again As El Salvador Opens New Era for Investment Banks. https://www.mitrade.com/insights/news/live-news/article-3-1026984-20250810

[4] AInvest. (2025). Bitcoin News Today: El Salvador Legalizes Bitcoin Investment Banks with Regulatory Framework. https://www.ainvest.com/news/bitcoin-news-today-el-salvador-legalizes-bitcoin-investment-banks-regulatory-framework-2508/

[5] ChainCatcher. (2025). Hotcoin Research | Global Cryptocurrency Regulatory Developments. https://www.chaincatcher.com/en/article/2196315