New technical rules for the Bitcoin law in El Salvador have been put up for discussion by the central bank. The document aims to clarify the rights and requirements for financial institutions wishing to offer Bitcoin dollar exchange services in the country after it has officially become legal tender. Essential provisions are the extensive collection, storage and reporting of customer data.
The published paper says it aims to facilitate the introduction of Bitcoin as legal tender in the country by providing guidelines on the rights and requirements for financial industry companies and their transactions.
Any financial institution that wants to offer BTC / USD and USD / BTC exchange services to Salvadorans would abide by the new rules, the document says. The Central Bank of El Salvador would require such companies to collect Know-Your-Customer (KYC) information in order to comply with Anti-Money Laundering (AML) guidelines.
More specifically, the government would require financial institutions offering bitcoin exchange and custody services to keep records of all transactions and their parties involved for 15 years from the date the operation was completed. In addition, institutions must comply with international laws supposedly aimed at preventing money laundering and terrorist financing by putting in place procedures to analyze each transaction. Vendors must also report “suspicious” operations to the authorities, although the document does not provide much detail about this classification.
However, the document is apparently only intended to regulate financial institutions that would dare to offer bitcoin exchange and custody services in El Salvador. The aim is to create a clear legal framework for companies that want to provide similar functionalities as the national Bitcoin wallet, which supports the exchange of dollars for Bitcoin and vice versa, as well as the safekeeping of both currencies. Therefore, the proposed rules would not include developers, non-custody wallets, and other Bitcoin services.