How El Salvador’s Bitcoin Experiment Is Being Quietly Studied by 40 Other Governments

Financial authorities and central bank representatives from forty-four nations discreetly flew into San Salvador in May 2022. They weren’t present for a diplomatic meeting or a commercial summit. They came to research a small country in Central America that had adopted Bitcoin as legal tender and added it to national reserves—something no other sovereign government had ever tried.

They attended talks on digital asset legislation, met with economists, looked at the Chivo wallet infrastructure, and asked the kind of cautious, noncommittal questions that government officials ask when they are genuinely interested but aren’t ready to express it in public. Nigeria was present. Kenya, Pakistan, Nepal, and Egypt. nations with vastly disparate economies, varying ties to the dollar, and diverse motivations for paying attention.

When El Salvador adopted Bitcoin in 2021, it was met with a combination of international ridicule and real concern. While detractors from the IMF and traditional economics community cautioned about financial instability, speculative risk, and the practical difficulties of forcing a volatile digital asset into everyday commerce in a nation where the majority of transactions occurred in cash,

President Nayib Bukele announced the decision with typical theatrics, posting enthusiastically on Twitter. The worries weren’t irrational. The price of Bitcoin was fluctuating dramatically. There was hardly any technical infrastructure in place for digital payments. Furthermore, surveys soon showed that the majority of Salvadorans were unsure of what the law actually required of them.

Some of those anxieties were validated and others were exacerbated by the adoption tale that surfaced during the ensuing years. By 2023, almost 88% of companies were still mostly using dollars for transactions, only utilizing the Chivo wallet upon request from clients. Given that El Salvador gets substantial financial transfers from its diaspora in the United States, the remittance corridor—one of the main economic justifications for the policy—showed a limited uptake. Far below the government’s declared goals, only around 2% of remittances were passing through cryptocurrency channels. MoneyGram and Western Union continued to take their shares.

Nevertheless, the nation possessed about 6,000 Bitcoin, which, depending on when you checked the market, could be worth anywhere from $500 to $600 million. A volatile asset held with true long-term conviction rather than traded for short-term returns, that holding represented something that traditional reserve management frameworks typically don’t accommodate. It was steadily accumulated through government purchases and maintained through several market downturns.

The goal of central bank economists researching El Salvador was not always to duplicate the legal tender mandate. They were attempting to determine whether treating Bitcoin as a reserve asset—absorbing its volatility in exchange for possible long-term appreciation—was a feasible substitute for the customary basket of gold and foreign currencies.

In Western coverage of the subject, the financial independence angle is typically overlooked. Monetary policy is not under El Salvador’s authority. Since it dollarized its economy in 2001, interest rate decisions made by the Federal Reserve have an impact on the cost of borrowing for Salvadorans without any involvement from Salvadoran policymakers.

A hedge against that reliance is the Bitcoin reserve, an asset whose value is decided by the dynamics of international markets rather than US monetary policy. Watching this experiment, nations in Latin America and Africa are not really keen in having their citizens purchase coffee with Bitcoin. They want to know if a minor nation managed to accumulate reserves outside of the dollar system and if that strategy was successful.

The boundaries of that independence were exposed by the IMF’s intervention in 2025. El Salvador consented to make Bitcoin acceptance optional rather than required for companies in order to obtain a $1.4 billion loan. In terms of legislation, the compromise appeared to be a retreat.

However, the government did not liquidate its Bitcoin assets under duress; instead, it continued to view the cryptocurrency as a strategic treasury asset. The fact that international financial institutions can affect how policies are implemented but cannot compel the reserves to be divested themselves is instructive.

Compared to the reserve asset question, the Chivo wallet experience provides lessons that other countries researching digital adoption find more instantly applicable. In an effort to boost adoption through financial incentives, El Salvador developed a government-run digital wallet and gave thirty dollars in Bitcoin to any resident who registered. The outcomes were not entirely consistent. The app was downloaded by millions of people.

Many quit using it after cashing out the first thirty dollars. However, the infrastructure developed to support Chivo—transaction processing, customer assistance, and merchant integration—created previously unheard-of digital payment capabilities, catering to a population in whom 70% had no bank accounts. The lesson other governments extracted wasn’t “launch a Bitcoin wallet.” It was nearer to “digital-first financial infrastructure can reach unbanked populations if the onboarding friction is low enough.”

In response, Panama created draft cryptocurrency laws with the goal of establishing a legal framework for the usage of digital assets without requiring the use of any particular currency.

Russia investigated using Bitcoin and other cryptocurrencies for cross-border transactions as a workable solution to financial isolation after being barred from the SWIFT payment system due to Western sanctions. Due to their severe currency strains and heavy reliance on remittances, both Cuba and Ukraine investigated if cryptocurrency channels could lower the cost of international money transfers for their citizens.

It’s possible that El Salvador’s most important contribution to international financial policy isn’t the legal tender experiment at all, but rather proving that a small nation can develop a thorough regulatory framework for digital assets, draw in tech firms to set up regional operations, and amass enough institutional expertise to host 44 foreign governments for a serious discussion about monetary alternatives.

El Salvador’s National Digital Assets Commission, or CNAD, became something of a model for developing nations considering digital asset regulation without access to the extensive institutional resources that the SEC or European regulators offer.

It’s difficult to ignore how this story changes over the course of four years in terms of how it reads depending on the year. It appeared to be a careless political ploy in 2021. It appeared to be a faltering social experiment in 2022. The reserve technique began to appear less embarrassing by 2024, when the price of Bitcoin had increased dramatically from El Salvador’s average purchase price.

By 2025, the “failed experiment” story is at odds with the data, as 44 countries have dispatched experts to examine the model and several countries have developed their own digital asset frameworks that were partially influenced by what El Salvador constructed.

It’s yet unknown if any of the countries researching El Salvador will take similar steps to accept Bitcoin. Due to their larger, more complicated economies, deeper IMF ties, and local political settings that would oppose Bukele’s type of unilateral executive action, the majority of them are significantly more constrained.

However, doing something and researching something are two distinct things, and the latter is occurring at a size and level of seriousness that wasn’t apparent three years ago. Bitcoin’s viability as a national currency was not demonstrated by El Salvador. It demonstrated that, regardless of where they end up, serious governments now feel compelled to investigate the subject of what part digital assets play in national financial policy.