El Salvador made headlines in 2021 when it became the first country in the world to adopt Bitcoin as legal tender. This bold move, spearheaded by President Nayib Bukele, was seen as a groundbreaking experiment in cryptocurrency adoption at a national level. However, recent developments suggest that the Central American nation is now taking a more cautious approach to its cryptocurrency policies.
When El Salvador first embraced Bitcoin, President Bukele presented it as a solution to several economic challenges. El Salvador was seeking to reduce dependency on the US dollar, while also facilitating easier remittances from Salvadorans abroad. Bukele also saw Bitcoin as a way to boost the country’s GDP through cryptocurrency investments.
From a more personal perspective, Bukele, who is known for his tech-savvy image and social media presence, saw this move as a way to position El Salvador at the forefront of financial innovation.
However, in February 2025, El Salvador began dialling back its ambitious Bitcoin policies, implementing significant changes to its cryptocurrency law. Shopkeepers are no longer obliged to accept Bitcoin alongside the US dollar; instead, businesses can now choose whether to embrace digital coins or stick to traditional currency. This voluntary approach marks a stark departure from the government’s initial enthusiasm for widespread Bitcoin adoption.
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