Two members of the House of Representatives have introduced legislation aimed at mitigating the risks to the United States financial system due to El Salvador adopting Bitcoin as legal currency.

In a Monday announcement, California Representative Norma Torres and Arkansas Representative Rick Crawford proposed legislation which would direct the State Department to create a plan mitigating the potential risks to the U.S. financial system based on an analysis of the risks to El Salvador’s “cybersecurity, economic stability, and democratic governance” following the country recognizing Bitcoin (BTC) as legal tender in September 2021. The Accountability for Cryptocurrency in El Salvador Act is a companion bill to bipartisan legislation introduced in the Senate in February.

The Senate bill aimed to have the Secretary of State and heads of Federal departments and agencies report to Congress within 60 days on a plan to "mitigate any potential risk to the United States financial system posed by the adoption of a cryptocurrency as legal tender" in El Salvador and other countries which accept the U.S. dollar — seemingly including Ecuador, Micronesia, Palau, East Timor, Zimbabwe, and the Marshall Islands. Torres cited the International Monetary Fund’s reports that the use of Bitcoin as legal tender carried “large risks” related to financial stability, financial integrity and consumer protection.

“El Salvador is an independent democracy and we respect its right to self-govern, but the United States must have a plan in place to protect our financial systems from the risks of this decision, which appears to be a careless gamble rather than a thoughtful embrace of innovation,” said Torres.

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