El Salvador’s Legislative Assembly has amended its Bitcoin Law, making it optional for businesses to accept Bitcoin as payment. The change comes as part of the conditions set by the International Monetary Fund (IMF) for a $1.4 billion loan aimed at strengthening the country’s economy.
In 2021, El Salvador became the first country to adopt Bitcoin as legal tender alongside the US dollar. However, the mandatory Bitcoin acceptance for businesses faced criticism due to the cryptocurrency’s volatility and the population’s limited understanding of digital currencies.
The recent reforms allow businesses to choose whether to accept Bitcoin, and the government will no longer accept Bitcoin for tax payments. This move aims to address concerns raised by the IMF about the potential risks to financial stability and consumer protection while still maintaining Bitcoin’s legal status in the country.
In response to these concerns, the government also plans to scale back its involvement in Bitcoin-related initiatives, including reducing the use of the Chivo Wallet app.
Norway’s central bank has built up over $500 million in indirect Bitcoin exposure through its investments in MicroStrategy and other crypto-focused companies. Research from K33 shows that Norway’s exposure to Bitcoin has nearly tripled in the past year as allocations to crypto-related firms have increased.
The country’s sovereign wealth fund, managed by Norges Bank Investment Management, holds 0.72% of MicroStrategy’s total shares, worth around $514 million as of December 2024. This translates to an indirect holding of roughly 3,214 Bitcoin. Alongside MicroStrategy, the fund also has investments in Tesla, Coinbase, Marathon Digital, Riot Platforms, and Metaplanet, adding another $61 million in exposure.
While Norges Bank’s strategy follows rule-based sector weighting rather than direct Bitcoin purchases, its growing involvement in crypto-linked firms signals increasing institutional acceptance of Bitcoin. Similar investment trends have been seen in Switzerland, where central banks have also allocated funds to MicroStrategy amid its expanding Bitcoin reserves.
Bitcoin experienced a 6% drop on 27 January, as stock markets reacted to the debut of China’s open-source AI model, DeepSeek, which some have dubbed ‘AI’s Sputnik moment.’ The new model developed on a modest budget of just under $6 million, raised concerns in US markets as it posed a competitive threat to American AI giants like OpenAI. The surprise launch led to significant losses across tech stocks, including Nvidia, Apple, and Tesla, with Nvidia seeing a record-breaking 17% drop. Energy stocks, which had relied on revenue from power-intensive US AI models like ChatGPT, also suffered.
While the impact on Bitcoin and other cryptocurrencies may seem directly linked to DeepSeek, experts suggest the broader market sentiment played a bigger role. Cryptocurrency, often seen as a “risk-on” asset, typically mirrors the movements in stock markets. As investor fears triggered sell-offs, major coins like Bitcoin and Ether saw their values fall alongside tech stocks. Despite the dip, some analysts remain optimistic, noting that Bitcoin’s quick recovery amidst a broader market decline signals positive prospects.
DeepSeek’s impact on Bitcoin, however, seems minimal in the long run. The open-source nature of the AI model allows others to incorporate its innovations into their own developments, potentially accelerating AI progress worldwide. While concerns about DeepSeek’s political and privacy implications linger, particularly in the US and EU, the model is expected to drive advancements in AI at a lower cost. Yet, its influence on crypto markets is likely to remain limited, with institutional investors continuing to view cryptocurrencies as a risk-heavy asset class.
The Czech National Bank (CNB) has revealed plans to assess the possibility of adding Bitcoin (BTC) to its reserve assets, despite opposition from European Central Bank (ECB) President Christine Lagarde. The decision follows a review of its 2024 reserve management strategy, where the CNB highlighted ongoing efforts to diversify its investments. While no immediate changes will be made, the central bank intends to conduct a thorough review before making any decisions.
Reports suggest the CNB could allocate up to 5% of its reserves to Bitcoin, amounting to over $7 billion. Governor Aleš Michl has expressed interest in Bitcoin as a potential diversification tool, calling it a “very interesting” asset. However, the ECB remains strongly opposed, with Lagarde insisting that central bank reserves must remain liquid and secure, free from concerns over money laundering or criminal activity.
The CNB’s exploration of Bitcoin aligns with a broader global trend of national reserves incorporating digital assets. In the US, former President Donald Trump recently signed an executive order allowing a crypto working group to study the potential for a national Bitcoin stockpile. With growing interest among G20 nations, the debate over Bitcoin’s role in central banking is far from over.
Poland has expanded its Bitcoin ATM network to 219 machines, surpassing El Salvador to become the fifth-largest network globally, just behind the US, Canada, Australia, and Spain. The country added 10 new machines on 27 January, continuing its four-month spree of new installations, which began in October 2024. Meanwhile, El Salvador, which was one of the third-largest networks in October 2022, has not increased its Bitcoin ATM capacity.
Despite Poland’s growth, Salvadoran officials are focused on the broader adoption of Bitcoin. Juan Carlos Reyes, president of El Salvador’s National Commission of Digital Assets, explained that while Bitcoin ATMs provide a valuable service, they are becoming less essential due to the seamless integration of Bitcoin payments in daily life, reducing reliance on ATMs. He also pointed out that Bitcoin’s utility extends far beyond ATM transactions, giving citizens more options for everyday purchases.
Reyes further stressed the importance of balanced regulation for Bitcoin and crypto ATMs, particularly around concerns such as money laundering. He emphasised that Bitcoin’s traceable nature makes it fundamentally different from other digital assets, which should be considered when developing regulatory measures.
The global crypto ATM landscape now has around 38,100 machines spread across 65 countries. Notably, Australia has seen consistent growth and joined the US and Canada in surpassing 1,000 active Bitcoin ATMs.
The US Securities and Exchange Commission (SEC) has partially won its case against the crypto exchange Kraken. A California federal judge ruled on 24 January 2025, dismissing Kraken’s argument that Congress had not granted the SEC jurisdiction over the crypto market. Judge William Orrick decided that the SEC’s actions fell within powers that Congress could reasonably have delegated to the agency.
Kraken had invoked the ‘major questions doctrine,’ which argues that government agencies cannot exercise powers not specifically granted by Congress. Other crypto companies, such as Coinbase and Binance, have used this defence in similar cases. However, Judge Orrick noted that while cryptocurrency is growing, it has not reached an economic significance comparable to other sectors like energy or student loans.
Despite this, the court allowed Kraken’s ‘fair notice’ defence to remain in place. Kraken claimed it wasn’t adequately informed by the SEC about how its activities might violate securities laws. The case, which began in November 2023, is part of the SEC’s ongoing efforts to regulate the crypto industry, with Kraken accused of operating without proper registration as a securities exchange.
Binance co-founder Changpeng ‘CZ’ Zhao has voiced strong support for government transparency, advocating for all public spending to be tracked on the blockchain. It comes after reports suggesting Elon Musk and the Department of Government Efficiency (DOGE) are exploring blockchain to improve fiscal accountability and address the federal deficit in the United States. In a post on 25 January, CZ argued that all government expenditures should be recorded on an immutable public ledger, stressing that “public spending” should be fully transparent.
The call for onchain tracking of government spending has sparked widespread debate online, particularly among advocates of small government and fiscal responsibility. Blockchain’s transparency could offer a solution to rising government debt and fiscal irresponsibility, as the immutable nature of the ledger would make it impossible to alter past transactions.
In light of the ongoing global fiscal challenges, including the US’s mounting $36 trillion national debt, CZ’s suggestion aligns with the broader discussion about the role of blockchain in promoting sound monetary and fiscal policies. Fixed-supply assets like Bitcoin are increasingly seen as a hedge against currency inflation, and some, including former President Trump, have suggested using Bitcoin to pay off national debt.
The idea of tracking government spending on the blockchain continues to gain traction as a potential method for increasing transparency and reducing inefficiencies within government finances.
Bitcoin has surged to an all-time high of $109,071 following Donald Trump’s inauguration as a “crypto president” and optimism surrounding eased regulations and ETF approvals. However, some of the world’s largest investors remain unconvinced about cryptocurrency’s potential.
Anne Walsh, chief investment officer at Guggenheim Partners, which manages $335 billion in assets, stated that her firm has not invested in crypto. She described Bitcoin as a reflection of “risk-on appetite” rather than an alternative to traditional banking. Similar scepticism was echoed by Nicolai Tangen, CEO of Norway’s $1.8 trillion sovereign wealth fund, who ruled out crypto investments for Norges Bank.
Saira Malik of Nuveen, with $1.3 trillion in assets under management, highlighted the difficulty in determining the fundamental value of crypto, although her firm invests in companies exposed to digital assets. Meanwhile, Melissa Stolfi of TCW Group, which oversees $200 billion, emphasised focusing on core business operations rather than entering the crypto market.
Despite Bitcoin‘s explosive growth, major investment firms remain cautious, citing concerns about valuation, regulation, and the resources required to succeed in the crypto space.
Ivanka Trump has issued a public warning against a fraudulent cryptocurrency named the so-called ‘$IVANKA’ coin. ‘To be clear: I have no involvement with this coin. This fake coin risks deceiving consumers and defrauding them of their hard-earned money,’ she stated.
The warning comes amid a surge of meme tokens linked to prominent figures, including $TRUMP and $MELANIA, launched over the weekend. These tokens initially gained attention but have since seen significant drops in value. The $TRUMP coin, linked to the former president, peaked before falling by 50% to $37, while the $MELANIA token plunged by 80% to $2.84.
Despite their popularity among crypto enthusiasts, meme coins are highly volatile and lack intrinsic value. Ivanka Trump, who played a major role in the first Trump administration alongside her husband Jared Kushner, urges caution to help investors avoid losses from deceptive schemes.
At the World Economic Forum in Davos, BlackRock CEO Larry Fink shared an optimistic outlook on Bitcoin, positioning it as a potential hedge against currency debasement and political instability. He suggested that Bitcoin could reach values of $500K to $700K per coin, presenting it as a global financial tool to overcome concerns about local economic uncertainty. However, Fink also pointed out Bitcoin’s notorious volatility, acknowledging that its price has seen sharp corrections even during bullish periods.
In a significant move, BlackRock has purchased $600 million worth of Bitcoin, marking its largest acquisition in 2025. This purchase brings the firm’s iShares Bitcoin Trust to a total of 559,262 BTC, currently valued at approximately $58.51 billion. BlackRock has also expanded its crypto portfolio, launching the iShares Bitcoin Trust and iShares Ethereum Trust last year, offering investors more direct access to Bitcoin and Ethereum.
As the firm continues to strengthen its position in the digital assets market, the recent purchase highlights growing institutional interest in Bitcoin as a long-term investment despite its volatility.
