- Remittances to El Salvador sent in crypto have plummeted from $70 million in 2022 to just $8 million in 2023, now accounting for only 1% of all remittances compared to 17% previously.
- Despite El Salvador making Bitcoin legal tender and collaborating with major players, recent surveys show 88% of citizens still don’t use crypto in daily life and the government’s Bitcoin purchases lack transparency.
- Most remittances to El Salvador continue to flow through traditional banking and alternative channels rather than crypto, challenging the notion that crypto would revolutionize remittances.
Remittances to El Salvador Plummet in Crypto
According to the Central Bank of El Salvador, remittances sent in crypto fell from $70 million in 2022 to $8 million in 2023. Crypto remittances now account for only 1% of all remittances, down from 17% previously.
El Salvador’s Bitcoin Adoption Efforts
Under President Nayib Bukele, El Salvador collaborated with major players to make Bitcoin legal tender. However, recent surveys show 88% of citizens still don’t use crypto in daily life. The government’s Bitcoin purchases also lack transparency.
Authoritarian Maneuvers Undermine Trust
Bukele’s authoritarian governance style, including extending his presidential term limits, has undermined trust. Rushed Bitcoin adoption adds to perceptions the government values swift action over deliberation.
Remittances Still Flow Through Traditional Channels
Despite crypto’s legal status, most remittances to El Salvador flow through traditional banking and alternative channels. This challenges the notion crypto would revolutionize remittances.
El Salvador Stands Alone in Full Bitcoin Adoption
No other nation has successfully followed El Salvador’s model. The Central African Republic’s efforts failed quickly. Venezuela legalized crypto but usage has declined as restrictions on dollars eased.
El Salvador’s declining crypto remittances show tepid public interest despite the government’s aggressive promotion. Most citizens continue using traditional remittance methods.