Bitcoin News

Story: El Salvador’s Bitcoin Strategy Shifts Toward Institutional Banking

By Steven Anderson

1 / 15

IMF Agreement and Policy Realignment. The new strategy appears closely tied to a $1.4 billion loan deal El Salvador recently secured…

2 / 15

New Law Targets Institutional Players. On August 7, the Legislative Assembly passed a new law creating a dedicated regulatory framework…

3 / 15

A First-Mover Advantage. While the public adoption campaign faced setbacks, El Salvador’s position as the first country to…

4 / 15

The State of El Salvador’s Bitcoin Holdings. Despite scaling back public adoption efforts, El Salvador has maintained its Bitcoin reserves.

5 / 15

Mixed Results from the Original Strategy. When Bitcoin was first introduced as legal tender, the government hoped it would encourage…

6 / 15

Looking Ahead. El Salvador’s latest policy direction signals a more measured approach, aiming to strengthen the…

7 / 15

El Salvador, the first country in the world to adopt Bitcoin as legal tender, is changing its approach to cryptocurrency.

8 / 15

This shift comes three years after the country passed its groundbreaking 2021 Bitcoin Law, which made it mandatory for merchants to accept Bitcoin as a form of payment.

9 / 15

The new strategy appears closely tied to a $1.4 billion loan deal El Salvador recently secured from the International Monetary Fund (IMF).

10 / 15

President Nayib Bukele’s original vision of mass adoption proved challenging to realize. While the country saw an uptick in global attention and tourism, domestic use of Bitcoin…

11 / 15

On August 7, the Legislative Assembly passed a new law creating a dedicated regulatory framework for financial institutions to participate in the digital asset space.

12 / 15

Holders of this license will be able to provide services such as Bitcoin custody, issuing tokenized securities, and facilitating cryptocurrency-related transactions.

13 / 15

The legislation also offers incentives to attract foreign capital. Notably, licensed PSADs will benefit from zero capital gains tax on Bitcoin transactions, as well as a…

14 / 15

While the public adoption campaign faced setbacks, El Salvador’s position as the first country to make Bitcoin legal tender has given it a unique advantage in the crypto space.

15 / 15

One example is a recent memorandum of understanding with Bolivia, under which El Salvador will share its expertise in creating digital asset regulations.

The Currency Analytics

Want the full story?