Officials from El Salvador have proposed to the Crypto Task Force of the US SEC a cross-border regulatory sandbox, focused on tokenization. The pilot project involves a US-licensed broker collaborating with a Salvadoran tokenization company, and conducting tests in the real estate sector and in token-based capital raising.
El Salvador and the SEC USA: the proposal for a cross-border crypto sandbox on tokenization
According to what was reported, on April 22, the Crypto Task Force of the United States Securities and Exchange Commission (SEC) met with representatives of the National Commission for Digital Assets (CNAD) of El Salvador.
The topic discussed was that of the approaches to address issues related to crypto regulation, especially on tokenization.
In particular, the officials of El Salvador have proposed to establish a cross-border sandbox for digital assets, offering the Salvadoran regulatory infrastructure as a testing ground.
Here is how the document states:
“This initiative offers the SEC Crypto Task Force a real case study to evaluate simplified regulatory approaches for digital assets, an opportunity to observe and refine frameworks that could enhance the U.S. market innovation. The CNAD has cultivated a robust ecosystem that balances consumer protection with technological advancement, a model that has attracted top-tier operators in the digital asset space, including major exchanges and Tether (USDT). The CNAD has agreed to collaborate with the SEC to establish a controlled sandbox pilot program.”
The proposed sandbox targets the real estate sector and capital markets, thus establishing a pilot project for each sector.
Specifically, the test requires a broker with a U.S. license to collaborate with a Salvadoran company in their respective two sectors based on tokens.
El Salvador together with the SEC USA to address issues on crypto regulation
The pilot program will involve a selected group of sophisticated participants who will employ limited capital (with a maximum cap of 10,000 dollars per scenario), to minimize risk and maximize regulatory knowledge.
In practice, the sandbox includes: 1) a traditional financial broker with a US license obtaining a license for digital assets under CNAD regulations, and 2) the development of two small-scale tokenization offerings facilitated by a tokenization company with a CNAD license.
The scope and the number of tokens issued will be adjusted in collaboration with the SEC to align with its data collection objectives, ensuring usable results for the regulatory development of the United States.
If the proposal for a cross-border sandbox by the officials of El Salvador were accepted, the pilot project will serve as a case study to inform future regulation.
The ultimate goal is precisely to generate practical data for the SEC on the classification of tokens, on custody solutions and on how digital assets can be integrated into the US regulatory frameworks, without undergoing a full securities treatment.
“`html
The disappointment in Bitcoin services and the start of partnerships in AI
“`
Recently, the Central Reserve Bank (BCR) of El Salvador revealed that there are only 20 registered Bitcoin Service Providers (BSP) that are actually operating in the country.
In practice, 89% of crypto companies in El Salvador are inactive, perhaps reflecting a general disinterest in Bitcoin, at least from the average citizen.
A disappointment for President Nayib Bukele, who had already commented in August 2024 that the adoption of BTC in El Salvador was not yet as widespread as hoped.
Also in this month of April, however, El Salvador has continued to ride the wave of emerging technologies, even though, instead of Bitcoin, the country has focused on AI.
In fact, recently, El Salvador announced a collaboration with Nvidia to jointly develop initiatives related to Sovereign AI. This model allows countries to independently control their own infrastructures and data related to artificial intelligence.
