skip to main content

S. 3666: ACES Act


The text of the bill below is as of Apr 4, 2022 (Reported by Senate Committee).


II

Calendar No. 321

117th CONGRESS

2d Session

S. 3666

IN THE SENATE OF THE UNITED STATES

February 16, 2022

(for himself, Mr. Menendez, and Mr. Cassidy) introduced the following bill; which was read twice and referred to the Committee on Foreign Relations

April 4 (legislative day, March 31), 2022

Reported by , with an amendment

Strike out all after the enacting clause and insert the part printed in italic

A BILL

To require reports on the adoption of a cryptocurrency as legal tender in El Salvador, and for other purposes.

1.

Short title

This Act may be cited as the Accountability for Cryptocurrency in El Salvador Act or ACES Act.

2.

Reports on adoption of cryptocurrency as legal tender in El Salvador

(a)

In general

Not later than 60 days after the date of the enactment of this Act, the Secretary of State, in coordination with the heads of other relevant Federal departments and agencies, shall submit to the appropriate committees of Congress a report on the adoption by the Government of El Salvador of a cryptocurrency as legal tender.

(b)

Elements

The report required by subsection (a) shall include the following:

(1)

A description of the process followed by the Government of El Salvador to develop and enact the Bitcoin Law (Legislative Decree No. 57, Official Record No. 110, Volume 431, enacted June 9, 2021), which provides the cryptocurrency, Bitcoin, with legal tender status in El Salvador.

(2)

An assessment of—

(A)

the regulatory framework in El Salvador with respect to the adoption of a cryptocurrency as legal tender and the technical capacity of El Salvador to effectively mitigate the financial integrity and cyber security risks associated with virtual-asset transactions;

(B)

whether the regulatory framework in El Salvador meets the requirements of the Financial Action Task Force with respect to virtual-asset transactions;

(C)

the impact on individuals and businesses of requiring tender of Bitcoin; and

(D)

the impact of such adoption of a cryptocurrency on—

(i)

the macroeconomic stability and public finances of El Salvador, including taxation;

(ii)

the rule of law and democratic governance in El Salvador;

(iii)

the unbanked population in El Salvador;

(iv)

the flow of remittances from the United States to El Salvador;

(v)

El Salvador's relations with multilateral financial institutions, such as the International Monetary Fund and the Word Bank;

(vi)

bilateral and international efforts to combat transnational illicit activities;

(vii)

El Salvador's bilateral economic and commercial relationship with the United States and the potential for reduced use by El Salvador of the United States dollar; and

(viii)

existing United States sanctions frameworks and the potential for the use of cryptocurrency to circumvent such sanctions.

(3)

A description of the internet infrastructure of El Salvador and an assessment of—

(A)

the degree to which cryptocurrency is used in El Salvador;

(B)

matters relating to chain of custody and the potential for hacking and cybertheft of cryptocurrency; and

(C)

access to transparent and affordable internet and digital infrastructure among the unbanked population of El Salvador.

(c)

Plan To mitigate risks to United States financial system posed by adoption of cryptocurrency as legal tender in certain countries

(1)

In general

Not later than 90 days after the submittal of the report required by subsection (a), the Secretary of State, in coordination with the heads of other relevant Federal departments and agencies, shall submit to the appropriate committees of Congress a plan to mitigate any potential risk to the United States financial system posed by the adoption of a cryptocurrency as legal tender in—

(A)

El Salvador; and

(B)

any other country that uses the United States dollar as legal tender.

(2)

Implementation

Not later than 30 days after the date on which the plan is submitted under paragraph (1), the Secretary of State shall commence implementation of the plan.

(d)

Subsequent report

Not later than 270 days after the submittal of the report required by subsection (a), the Secretary of State, in coordination with the heads of other relevant Federal departments and agencies, shall submit to the appropriate committees of Congress an updated version of such report, including a description of any significant development related to the risks to the United States financial system posed by the use of a cryptocurrency as legal tender in El Salvador.

(e)

Appropriate committees of Congress defined

In this section, the term appropriate committees of Congress means—

(1)

the Committee on Foreign Relations and the Committee on Banking, Housing, and Urban Affairs of the Senate; and

(2)

the Committee on Foreign Affairs and the Committee on Financial Services of the House of Representatives.

1.

Short title

This Act may be cited as the Accountability for Cryptocurrency in El Salvador Act or ACES Act.

2.

Reports on adoption of cryptocurrency as legal tender in El Salvador

(a)

In general

Not later than 60 days after the date of the enactment of this Act, the Secretary of State, in coordination with the heads of other relevant Federal departments and agencies, shall submit to the appropriate committees of Congress a report on the adoption by the Government of El Salvador of a cryptocurrency as legal tender.

(b)

Elements

The report required by subsection (a) shall include the following:

(1)

A description of the process followed by the Government of El Salvador to develop and enact the Bitcoin Law (Legislative Decree No. 57, Official Record No. 110, Volume 431, enacted June 9, 2021), which provides the cryptocurrency, Bitcoin, with legal tender status in El Salvador.

(2)

An assessment of—

(A)

the regulatory framework in El Salvador with respect to the adoption of a cryptocurrency as legal tender and the technical capacity of El Salvador to effectively mitigate the financial integrity and cybersecurity risks associated with virtual-asset transactions;

(B)

whether the regulatory framework in El Salvador meets the requirements of the Financial Action Task Force with respect to virtual-asset transactions;

(C)

the impact on individuals and businesses of requiring tender of Bitcoin; and

(D)

the impact of such adoption of a cryptocurrency on—

(i)

the macroeconomic stability and public finances of El Salvador, including taxation;

(ii)

the rule of law and democratic governance in El Salvador;

(iii)

the unbanked population in El Salvador;

(iv)

the flow of remittances from the United States to El Salvador;

(v)

El Salvador's relations with multilateral financial institutions, such as the International Monetary Fund and the Word Bank;

(vi)

bilateral and international efforts to combat transnational illicit activities;

(vii)

El Salvador's bilateral economic and commercial relationship with the United States and the potential for reduced use by El Salvador of the United States dollar;

(viii)

existing United States sanctions frameworks and the potential for the use of cryptocurrency to circumvent such sanctions;

(ix)

the environmental impact of cryptocurrency mining activities in El Salvador, the deforestation associated with the construction of new cryptocurrency mining facilities, and the capacity of the electric grid in El Salvador to deliver reliable and affordable electricity meeting or exceeding the level available before the adoption of a cryptocurrency as legal tender; and

(x)

the feasibility of using cryptocurrency mining activities for purposes of enhancing grid resiliency in El Salvador and any other country that uses the United States dollar as legal tender.

(3)

A description of the internet infrastructure of El Salvador and an assessment of—

(A)

the degree to which cryptocurrency is used in El Salvador;

(B)

matters relating to chain of custody and the potential for hacking and cybertheft of cryptocurrency; and

(C)

access to transparent and affordable internet and digital infrastructure among the unbanked population of El Salvador.

(c)

Plan To mitigate risks to United States financial system posed by adoption of cryptocurrency as legal tender in certain countries

(1)

In general

Not later than 90 days after the submittal of the report required by subsection (a), the Secretary of State, in coordination with the heads of other relevant Federal departments and agencies, shall submit to the appropriate committees of Congress a plan to mitigate any potential risk to the United States financial system posed by the adoption of a cryptocurrency as legal tender in—

(A)

El Salvador; and

(B)

any other country that uses the United States dollar as legal tender.

(2)

Implementation

Not later than 30 days after the date on which the plan is submitted under paragraph (1), the Secretary of State shall commence implementation of the plan.

(d)

Subsequent report

Not later than 270 days after the submittal of the report required by subsection (a), the Secretary of State, in coordination with the heads of other relevant Federal departments and agencies, shall submit to the appropriate committees of Congress an updated version of such report, including a description of any significant development related to the risks to the United States financial system posed by the use of a cryptocurrency as legal tender in El Salvador.

(e)

Appropriate committees of Congress defined

In this section, the term appropriate committees of Congress means—

(1)

the Committee on Foreign Relations and the Committee on Banking, Housing, and Urban Affairs of the Senate; and

(2)

the Committee on Foreign Affairs and the Committee on Financial Services of the House of Representatives.

April 4 (legislative day, March 31), 2022

Reported with an amendment