El Salvador has enacted a new law to regulate artificial intelligence, which the country describes as a move to provide regulatory clarity for the industry. The Bitcoin Office announced the decision, noting that this aligns with President Nayib Bukele’s policy on economic liberty.
According to the announcement, the new law addresses both open-source and proprietary AI systems, with a particular focus on enabling open-source AI development.
The annoucement reads:
“This new legislative framework aims to ensure that both proprietary and open-source AI systems are afforded appropriate protections, with a particular emphasis on safeguarding open-source development — a pioneering step in global AI policy.”
Per the statement, proprietary AI models already enjoy international protections, and El Salvador wants to extend the same to open-source AI. To do this, Article 19 of the AI Law includes safeguards such as sandbox protections and shields against third-party mischief.
However, the country has also established an AI Registry and requires AI developers to register to fully enjoy all the protections under Article 19.
Meanwhile, the law also establishes an AI Lab through which the government can promote research, development, and application of AI within government services and institutions. This is all part of the country’s effort to develop its domestic technological capacity.
Unsurprisingly, El Salvador is also trying to attract foreign AI developers, and the new regulation is meant to boost its attractiveness. The announcement from the Bitcoin Office noted that the country already has a zero percent tax on AI innovation and development.
El Salvador earns praise for its embrace of innovation
The news that El Salvador has enacted an AI Law has attracted praise from various quarters, with many noting its giant strides in innovation. Most of the praise comes from thought leaders within the crypto community and founders who have already moved their operations to El Salvador.
Brian Roemmele added that this new law will change everything and described it as the most “well thought-out law for AI in the world.”
Sortium founder Marc Seal also described the law as a global statement showing El Salvador’s support of technological progress, adding that the country has always adopted a forward-thinking approach. This is in reference to the country’s pioneering adoption of Bitcoin and establishment of the BTC reserve.
He wrote:
“The passing of this legislation by the President and the Assembly cements El Salvador as a safe haven of innovation.”
The country has been making multiple efforts to attract foreign investors. A few days ago, at the Presidential House, Bukele met with several business leaders, including Marc Andreessen of A16Z and Michael Saylor of Strategy.
Meanwhile, El Salvador has continued its Bitcoin stacking despite declining BTC prices. Over the last seven days, during which BTC fell more than 16%, the country has added 10 BTC to its portfolio, bringing its holdings to 6,091 BTC.
Bukele also remains bullish on the assets and posted on X, “O ye of little faith,” a slight dig at the comments from some people in the crypto community who noted that El Salvador did not buy Bitcoin for about six days despite its One BTC per day policy.
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