Irving in this tale takes a common story that is present in many different cultures and deliberately rewrites it for his own contemporary audience. Note how the devil introduces himself to Tom when they meet and how he mentions specifically American events that he has participated in:
I am he to whom the red men devoted this spot, and now and then roasted a white man by way of sweet smelling sacrifice. Since the red men have been exterminated by you white savages, I amuse myself by presiding at the persecutions of quakers and anabaptists; I am the great patron and prompter of slave dealers, and the grand master of the Salem witches.
The references to slave dealing and the Salem witches are examples of real historical events where great evil occurred in America as a result of people's greed and hypocrisy: fitting events indeed for the devil to be present at and involved in. The story, which is of course all about the dangers of being willing to do anything to gain wealth, is therefore given a distinct American feel, and Irving's rewrite applies the same moral to his own audience, pointing out that trying to gain wealth at the expense of everything else is bound to lead to a nasty end. Irving was writing at a time when America was still trying to forge its own identity as a relatively new nation, and so taking European legends and adapting them to suit America was one way in which this helped to create a distinctly American identity.