El Salvador’s bitcoiner model inspires China and Hong Kong

The People’s Bank of China (PBOC) has stressed the need for regulation for the bitcoin (BTC) sector and other cryptocurrencies. This happens just a week after representatives of that Asian country met with those of El Salvador. During this meeting, bitcoin stood out as a key element in the Nayib Bukele government’s strategy to strengthen the economic growth of the Central American nation.

The government of El Salvador reported that its vice president, Félix Ulloa, held a meeting with the ambassador of the People’s Republic of China in Salvadoran territory, Zhang Yanhui, with the aim of strengthening bilateral ties and advancing projects to improve digital connectivity and economic growth.

According to the vice presidential office of El Salvador, during the meeting Ulloa highlighted how the Central American country has transformed into a model of financial freedom and digital economy, by having a treasure in bitcoin that exceeds 6,000 coins. Among the key initiatives mentioned are “El Salvador Vuela”, which focuses on the modernization and expansion of aeronautical infrastructure, and submarine cable, aimed at improving digital infrastructure to strengthen the country’s connectivity sovereignty.

Last April, Ulloa held a meeting with Chinese Vice President Han Zheng in Beijing, the capital of China. Now, in its recent publication of the 2024 Financial Stability Report, the PBOC highlights the need for specific regulation for cryptocurrencies. The report, released on Friday, includes a section dedicated to the supervision of digital assets, highlighting Hong Kong’s innovative approach to this sector.

The Central Bank of China recalls in its report the complete ban that has existed in the country on trading in digital assets and Bitcoin mining since September 2021. However, it highlights the contrast that exists with Hong Kong, which has adopted a path more permissive.

Although geographically part of the same nation, China and Hong Kong present significant differences in terms of political, social, cultural and economic systems, including their views on digital assets. While mainland China maintains a strict stance, Hong Kong has taken a different path.

Since June 2023, the special administrative region launched a licensing scheme for cryptocurrency trading platforms, allowing licensed exchanges to offer services to the retail public. This move reflects Hong Kong’s intention to become a leading financial center for cryptocurrency innovation.

Additionally, the PBOC has expressed its commitment to improving an international regulatory framework for crypto assets, in line with the recommendations of the Financial Stability Board. And although El Salvador is not mentioned in the report, anyone would think that The Central American nation may be influencing a change in position on the part of the Chinese authorities.

As NoticiasVE previously reported, there are suspicions that “China would unlock bitcoin with Trump in the White House.” The phrase is from the president and CEO of HashKey Group, Xiao Feng, who believes that the new government of Donald Trump could activate the Chinese government’s interest in the cryptocurrency trading and mining markets, unblocking the ban imposed in 2021.

Additionally, Feng thinks that the possibility of the United States gaining greater strength as a leader in the Bitcoin ecosystem could mobilize the competitive spirit of the Chinese.

Hong Kong would have a treasure in bitcoin like El Salvador

The fact that the United States could have a treasure in bitcoin following in the footsteps of El Salvador is something that has generated reactions around the world, including in Hong Kong, where Wu Jiezhuang, member of the Legislative Council and chairman of the Asset Development Subcommittee Virtual Web3, suggests that this region should not be left behind from the trend that is moving the world.

During an interview with Wen Wei Po newspaper, Wu Jiezhuang highlighted the need for Hong Kong to study how to maintain its financial security in this new context. In such a way that he proposed taking advantage of the principle of “one country, two systems” to include bitcoin in national reserves. “Some small countries have already taken this step, even adopting bitcoin as legal tender,” Wu commented, referring to El Salvador and highlighting the possibility of allocating up to 10% of fiscal reserves to BTC to diversify investments.

“Governments cannot turn a blind eye,” Wu said, highlighting the importance of evaluating how the decision to have a bitcoin treasury could boost Hong Kong’s financial security.

In other countries there is also talk of following the El Salvador model, such as in Brazil, for example, where deputy Eros Biondini presented a bill to create a BTC treasure. While in Japan, Senator Satoshi Hamada urged the government to join the national bitcoin reserve rush, highlighting its independence from national influences.

As part of the global movement, the mayor of Vancouver, Canada, proposed a motion to use the digital currency as a reserve asset; while, in Venezuela, opposition leader María Corina Machado has discussed the creation of a BTC reserve as a solution to the country’s economic crisis and inflation. And in Russia, deputy Anton Tkachev has asked the government to create a bitcoin treasury.