El Salvador’s groundbreaking move allows banks to operate exclusively as Bitcoin-only institutions for accredited investors. This law, enacted effective August 3, 2025, positions the nation at the forefront of digital asset banking and aims to attract global capital towards Bitcoin finance. President Nayib Bukele’s initiative seeks to transform El Salvador into a hub for Bitcoin transactions. The minimum capital requirement set at $50 million per bank signifies both financial opportunity and regulatory innovation. This bold action has already drawn considerable interest from institutional investors, securing $120 million in early investments. Industry experts anticipate this move will increase liquidity and bolster staking activities within the Bitcoin market. While global market reactions are positive, concerns regarding potential economic and social impacts remain. This novel legislation has the potential to reshape global financial landscapes by accelerating institutional Bitcoin adoption. The regulatory environment may mirror models like Liechtenstein and Switzerland where crypto-focused banking is thriving. This transformative initiative could pave the way for future advancements in Bitcoin banking.