El Salvador, under the leadership of pro-Bitcoin President Nayib Bukele, is advancing a proposal to establish private investment banks within the country. This initiative aims to provide investors with expanded financial services, offering options in both U.S. Dollars and Bitcoin, while operating under fewer restrictions compared to traditional banking institutions.

The proposed institution, named the Bank for Private Investment (BPI), seeks to diversify financing opportunities for potential investors, embracing both fiat currency and Bitcoin. Milena Mayorga, El Salvador's Ambassador to the United States, highlighted the strategic economic plan behind the BPI in a recent announcement.

"This initiative forms part of our economic strategy for El Salvador, aiming to broaden financing choices available to investors in both Dollars and Bitcoin," stated Mayorga in a communication on June 14.

Senior Bitcoin advisor to President Bukele, Max Keiser, emphasized the potential impact of the BPI, noting predictions by prominent figures such as Ark Invest's Cathie Wood, who suggested a substantial growth in El Salvador's GDP over the coming years.

The proposed BPI would operate under more flexible regulations compared to traditional banks, exempting it from certain prohibitions and restrictions typically imposed by banking laws. These exemptions include limitations on interactions with foreign financial entities and constraints on loan size relative to asset funds.

According to reports from El Mundo, the BPI would require a minimum capital investment of $50 million upon establishment, with at least two shareholders, potentially including foreign entities. Moreover, the institution aims to operate in multiple legal tender options, with potential aspirations to provide digital asset and Bitcoin-related services, pending regulatory approvals.

María Luisa Hayem, El Salvador’s Minister of Economy, has presented the reform proposal to the Technology, Tourism, and Investment Commission, aligning with President Bukele's economic vision. Despite these developments, the proposal has yet to secure legislative approval, awaiting further deliberation and potential voting within the commission.

If approved, the establishment of the BPI could signify a significant step towards integrating Bitcoin into the nation's financial infrastructure, positioning El Salvador as a pioneer in embracing cryptocurrencies within the traditional banking sector.