Cardano’s Charles Hoskinson Says He Rejected El Salvador Deal Over MS-13 Concerns

Cardano founder Charles Hoskinson has revealed that he turned down an offer to participate in El Salvador’s crypto adoption plan in 2021, citing serious legal and ethical concerns tied to the country’s controversial approach. In a newly surfaced interview, Hoskinson described an intense week of meetings with President Nayib Bukele’s administration, which ultimately ended in his decision to walk away from the proposal—primarily due to fears that the initiative would violate U.S. sanctions by delivering cryptocurrency to individuals linked to the notorious MS-13 gang.

Speaking on the Shawn Ryan Show, Hoskinson painted a chaotic and concerning picture of El Salvador’s early days of national Bitcoin adoption. According to him, the country’s top officials lacked coherent strategies, structure, or compliance planning. In his words, policies seemed to be based more on Facebook posts than formal governance.

Hoskinson recalled meetings with eccentric ministers, including a particularly memorable encounter with the Minister of Energy, who enthusiastically declared that “the power of magma will be the destiny of El Salvador.” This was part of the country’s now well-known geothermal Bitcoin mining initiative, which used volcanic energy as a clean source for mining operations. While creative and ambitious, the idea lacked clarity and technical depth during discussions, he suggested.

The most troubling part of the proposal, however, came when Hoskinson and his team raised questions about regulatory compliance. When asked about business requirements and legal safeguards, Salvadoran officials reportedly responded by pointing to President Bukele’s Facebook speeches. The blockchain entrepreneur said this ad hoc approach was one of many red flags.

The turning point came during discussions with U.S. counterparts. Hoskinson claimed that Bukele had intended to conduct a universal airdrop of cryptocurrency to every citizen in El Salvador. While on the surface this sounded inclusive, it raised serious concerns due to the presence of MS-13, a criminal group designated by the U.S. Office of Foreign Assets Control (OFAC) as a Transnational Criminal Organization.

“Bukele wanted to do an airdrop to everybody in El Salvador,” Hoskinson explained. “But MS-13 is on the OFAC list. So if we’re distributing Bitcoin to all citizens without filtering, we’re inadvertently funding a terrorist group. That’s no bueno.”

Hoskinson further noted that coordinating with the U.S. government at the time was extremely difficult. He described the Biden administration as being uninterested in collaboration with Bukele’s government, characterizing its position as favoring “regime change.” This lack of diplomatic support made the situation even more precarious, prompting Hoskinson to withdraw from the deal after only one week of negotiations.

Although Cardano opted out, El Salvador proceeded with its bold Bitcoin initiative. The country made Bitcoin legal tender in 2021 and rolled out its government-controlled Chivo wallet to facilitate widespread adoption. It currently holds around 6,230 BTC, worth an estimated $679 million based on current market prices.

Hoskinson acknowledged the significance of El Salvador’s move despite his personal reservations. “It was a very pivotal moment,” he said. “It actually made Bitcoin the official currency and forced the IMF and transnational bodies to start recognizing Bitcoin.”

The interview quickly drew criticism and skepticism within the crypto community. Some commentators questioned the accuracy of Hoskinson’s version of events. Bitcoin supporter Cory Bates voiced doubts on social media, implying the story didn’t match known facts. Another user, known as The Bitcoin Therapist, bluntly dismissed the claims as the “dumbest sh*t I’ve ever heard.”

To date, neither the Salvadoran government nor U.S. officials have confirmed or denied Hoskinson’s account of the failed negotiations. The absence of formal documentation or public confirmation has left the story in limbo—provocative but unverifiable.

Meanwhile, Cardano’s native ADA token has shown signs of slight recovery. At the time of this writing, ADA was trading at $0.5768, a 2.0% gain over the past week. However, the token still trails its previous highs, down over 12.5% from the prior month and far below its all-time peak of $3.09 reached in September 2021.

The larger implications of Hoskinson’s claims remain unclear. If accurate, they point to a deeper dilemma facing countries experimenting with national crypto strategies—particularly in regions with high levels of organized crime and limited regulatory infrastructure. It also underscores the legal complexities that come with blending cryptocurrency with international policy, especially when navigating sanctions and compliance requirements from global powers like the United States.

Ultimately, the story raises questions about the real challenges behind crypto adoption at a national scale. For now, it serves as a cautionary tale—one that highlights the balance between innovation and responsibility in a space where the stakes are global, the technology is borderless, and the consequences could extend far beyond digital assets.