El Salvador: Selected Issues
IMF Staff Country Reports, March 19, 2025
Source details
- Canonical URL
- El Salvador: Selected Issues
Other formats
Bibliographic details
- Published: March 19, 2025
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798229005104.002
Main findings on Bitcoin adoption and financial inclusion
- The Selected Issues paper focuses on Bitcoin and financial inclusion in El Salvador.
- El Salvador’s economy can benefit from policies to facilitate access to financial services, enhance financial literacy and lower the cost of remittances.
- The Bitcoin adoption as legal tender has not contributed to promote financial inclusion and digital remittances.
- More than one year after implementation, the adoption of Bitcoin as official currency with legal tender status has thus far not led to visible improvements in financial inclusion.
- Despite the large use of public funds for subsidizing bitcoin transaction costs, acceptance and use by individuals and firms remains minimal.
- There is no evidence of any beneficial use case of Bitcoin for the unbanked population.
Risks and systemic concerns identified
- The project involves sizeable risks, including:
- fiscal contingencies,
- consumer protection issues,
- governance issues.
- These risks could be magnified in the event of wider adoption and further fallout in crypto markets.
Policy implications and recommendations
- Prioritize policies to:
- facilitate access to financial services,
- enhance financial literacy,
- lower the cost of remittances.
- Reconsider public subsidy programs for bitcoin transaction costs given minimal private uptake and the fiscal risks described.
Content in this bundle
- El Salvador: Selected Issues; IMF Country Report No. 25/68; March 2, 2023