When Bitcoin law in El Salvador, the first national law to make Bitcoin legal tender. Also known as Bitcoin as legal tender, it was signed into law in June 2021 and changed how the world sees cryptocurrency—not as a niche tech experiment, but as real money. This wasn’t a trial or a pilot. It was a full government switch: Salvadorans could pay taxes, buy coffee, or rent a room using Bitcoin, and businesses had to accept it. The move was bold, controversial, and completely unprecedented.
Behind the law was a clear goal: cut costs for remittances. Over 70% of Salvadorans rely on money sent from abroad, mostly from the U.S. Each transfer used to cost 10% or more in fees. With Bitcoin, the government promised near-zero fees and instant transfers using the Chivo wallet. But the reality didn’t match the promise. Most people didn’t use Bitcoin for daily spending. They cashed out immediately into dollars. The Chivo wallet became a cash-out tool, not a payment system. And the government’s $150 million Bitcoin investment tanked when prices dropped—losing billions in paper value.
The cryptocurrency regulation, how governments control or allow digital assets in El Salvador became a global case study. Countries like Argentina and Nigeria watched closely, wondering if they should follow. Others, like the IMF and World Bank, warned it was risky. Meanwhile, the digital currency adoption, how real people start using crypto in daily life in El Salvador stayed low. Only about 20% of adults used Chivo regularly, and many didn’t trust it. The law didn’t make Bitcoin popular—it made it mandatory for businesses, which caused backlash.
Why does this still matter? Because El Salvador proved one thing: governments can force crypto into the system. But they can’t force people to use it. The real test isn’t legality—it’s adoption. And adoption needs trust, simplicity, and real utility. El Salvador’s experiment showed that even with a national push, most users still prefer cash or dollars. The Bitcoin law didn’t fail because of technology. It failed because it ignored human behavior.
Below, you’ll find real stories and data from posts that dig into what happened after the law passed—how miners used cheap power, how citizens reacted, and why some see this as a failed experiment while others still believe in its long-term vision. These aren’t opinion pieces. They’re facts from the ground.
El Salvador made Bitcoin legal tender in 2021 but reversed the policy in 2025 after public resistance and IMF pressure. Learn what worked, what failed, and why Bitcoin is no longer used for daily transactions.