In June 2021 Nayib Bukele, president of El Salvador, raised a singular option: Bitcoin turned into legal tender in his country. The country’s Bitcoin Law was approved shortly after, in September, but made it involved in controversy and uncertainty. Now, three and a half years later, Bukele has been forced to back down.
Bitcoin is no longer a legal tender in El Salvador. As they point out In the countrythe Salvadoran Parliament has approved a reform to the Bitcoin Law and causes it to cease to be considered official currency. It can continue to be used freely by users, but Bukele’s ambition in this area is thus truncated.
IMF pressures. The reason for the decision is simple. The International Monetary Fund (IMF) had been pressing El Salvador for two years and urging him to “mitigate the risks of Bitcoin.” The country chaired by Bukele urgently needed a loan of 1.4 billion dollars, but had to give in this reform. Today was the deadline to do it if I wanted such credit to be granted.
Bitcoin returns to the background. With this measure the Bitcoin ceases to be considered as legal tender, and for example, it cannot be used to pay taxes. Its adoption and acceptance goes from being mandatory to voluntary.
He never set. There are hardly any data on Bukele’s initiative, which was the only one who with his active profile on social networks such as Twitter/X spoke of the theoretical success of his measure. During approval They occurred Citizen protestsand the data suggest that their use by citizens has been reduced.
Wallet goat. The controversial digital wallet Created by the Government tried to promote the use of Bitcoin with a singular promotional measure: each person to install it was given. Public shops and institutions had the obligation to accept payment in Bitoin. In spite of all this, the acceptance of citizenship was always very limited mid -2022 The fall of Bitcoin was especially for El Salvador, which was about to enter bankruptcy. In 2024 only 8.1% of the population acknowledged having used the tool, they indicate in the country. A Wallet goat vulnerability also caused A value of $ 840,000.
Criticism and complaints. El Salvador media as the lighthouse indicate How most Salvadorans did not use bitcoin to make transactions “and more than 70 % responded that they did not benefit their economy in a survey.” In addition to corruption in the adoption of Bitcoin, with duplication or falsification of identities to collect the 30 dollars or violation of international laws against money laundering, they point out in the country.
Bukele barely comments. The president of El Salvador is very active in X, but has not commented on the issue. What he has done is comment The condemnation of corruption of the American senator Bob Menéndez, who had opposed the adoption of Bitcoin as legal tender in El Salvador. Only A brief message in X of the Legislative Assembly of El Salvador confirmed the modification of the Bitcoin Law.
Lack of transparency. As they point out in the country, opacity and lack of transparency regarding the initiative has been remarkable. There was no official information until recently, when the Salvadoran government launched a website called Bitcoin Office. According to this website, El Salvador has 6,049.18 BTC, equivalent to about 605 million euros.