Latam Insights Encore: US Senate's Weaponization of Bitcoin Ownership Should Raise Concerns

Welcome to Latam Insights Encore, a deep dive into Latin America’s most relevant economic and crypto news from the past week. This edition explores how the U.S. Senate is weaponizing bitcoin against El Salvador in a politicized attempt to sanction Bukele’s administration on alleged human rights violations.

Latam Insights Encore: U.S. Senate Weaponizes Bitcoin Against El Salvador

Bitcoin has surged, once again, as a geopolitical issue now that the U.S. Senate has hinted at the utilization of Bitcoin as an element in El Salvador’s alleged human rights violations.

Senators Chris Van Hollen, Tim Kaine, and Alex Padilla introduced the so-called “El Salvador Accountability Act of 2025,” establishing sanctions on President Bukele’s administration for allegedly accepting “taxpayer dollars, to deprive individuals residing in the United States of their rights,” in the context of the ongoing immigration dealings of the U.S. government.

Nonetheless, the introduction of bitcoin in this bill, which encompasses the preparation of a report detailing the status of bitcoin in El Salvador and the nation’s capabilities of using it for nefarious purposes, seems improvised at best.

Bukele’s reaction to this initiative, stating that Democrats were just salty, seems right, as there has been no evidence that there was any utilization of bitcoin linked to these actions.

The sole mention of bitcoin in the bill should raise concerns amidst governments around the world, as it seems to want to set a precedent weaponizing the ownership of bitcoin at a state-nation level, when decisions taken seem to upset one of the U.S.’s political parties.

This seems to point in the direction of depicting bitcoin as an element used in an illegal way or for illegal purposes, an idea that has been seemingly left behind with the progressive inclusion of the prime cryptocurrency in both national and international financial systems and with the current administration’s embrace of cryptocurrency.

Furthermore, President Bukele has stated that El Salvador will not be selling or moving its bitcoin anytime soon, given its relevance as a reserve asset for the country.

Read more: US Senate Introduces Bill to Enact Sanctions on El Salvador’s Bitcoin Usage in Human Rights Violations