Bitcoin usage in El Salvador remains minimal, with crypto wallets handling just 1% of remittances despite government incentives.
El Salvador’s five-year Bitcoin experiment has not increased financial inclusion or reduced remittance costs. The government’s Chivo wallet, launched in 2021, failed to address barriers preventing unbanked Salvadorans from accessing financial services, according to data from the National Bureau of Economic Research.
Remittances, a key driver of the Bitcoin push, accounted for 24% of El Salvador’s GDP in 2024, with 98% originating from the U.S. However, crypto wallets processed only 1% of these transfers, down from a peak of 1.7% in 2020-21. The country’s use of USD as its official currency removed the need for currency conversion, a primary benefit Bitcoin could have offered.
Over 60% of early Chivo wallet users stopped transacting after spending the $30 in free Bitcoin provided by the government, signaling low sustained adoption.