El Salvador and the city of Lugano, Switzerland, have signed a Memorandum of Understanding on economic cooperation aimed at spreading Bitcoin adoption.
The partnership between the Latin American country and the Swiss city will support “initiatives to drive the adoption of Bitcoin and other cryptocurrencies across their respective regions” as well as “fostering the exchange of students and talents between El Salvador and Lugano,” a Friday announcement by stablecoin issuer Tether said.
El Salvador will also open a “Bitcoin office” in Lugano to spread adoption of the cryptocurrency in Europe.
Tether, the company behind the world’s biggest stablecoin USDT, is working to make Lugano a crypto hub where people can spend Bitcoin and stablecoins through an initiative called “Plan B.”
Salvadoran Ambassador to the United States Milena Mayorga said in the announcement: “My fellow Salvadorans and I are very excited by the promise of Bitcoin, and I look forward to seeing how this initiative will help increase access to economic security and economic freedom for all, one of the main goals of President Nayib Bukele's government.”
— Stephan Livera (@stephanlivera) October 28, 2022
El Salvador last year made Bitcoin legal tender—becoming the first country in the world to do so. The law requires businesses to accept the asset for payment if those businesses have the technological means to do so.
The Central American nation’s leader Nayib Bukele has also bought tens of millions of dollars worth of the cryptocurrency—and Bitcoin enthusiasts have flocked to the nation for conferences and to spread adoption.
But the U.S. government criticized the move, with lawmakers claiming it “posed risks” to the American financial system and could “weaken U.S. sanctions policy, empowering malign actors like China and organized criminal organizations.”
And the IMF urged the tiny country to scrap the idea completely because of the “large risks for financial and market integrity, financial stability, and consumer protection.”
Decrypt also visited the country and found that many businesses didn’t accept Bitcoin and its citizens had lost interest in it.
El Salvador’s government spokeswoman did not respond to Decrypt’s request for further details on the new arrangement with Lugano.