Is El Salvador Giving Up on Bitcoin After 5 Years?
The government of El Salvador, known worldwide for being the first to adopt Bitcoin as legal tender in 2021, surprised the market by officially supporting a new remittance app based on a stablecoin called Sivar. The initiative, revealed in September 2026, signals a shift in focus: Bitcoin remains in use, but is now restricted to the state’s store of value, while everyday transactions and international transfers are starting to prioritize the local stablecoin.
From Bitcoin Pioneer to Stablecoin Supporter
Since Nayib Bukele made Bitcoin part of El Salvador’s economy, the country has been at the center of discussions about crypto adoption. BTC was incorporated as legal tender mainly to attract investment, promote financial inclusion, and lower remittance costs—which account for about 24% of the national GDP. However, five years after the measure, Bitcoin’s volatility and low adoption among the population have led the government to rethink its strategies.
The launch of Sivar, a stablecoin pegged to the dollar, aims to facilitate international remittances and everyday payments, reducing exposure to volatility and transaction costs. The platform was developed by private companies but received institutional support, signaling a transition from the initial enthusiasm for BTC to more stable and practical solutions.
Why Is Sivar Gaining Ground?
The main appeal of Sivar is its stability: since the stablecoin is pegged to the US dollar, users and merchants do not face the sharp price swings typical of Bitcoin. This makes Sivar especially useful for remittances—one of the main sources of income for Salvadoran families, who previously relied on expensive and slow services like Western Union.
Additionally, the use of stablecoins can increase financial inclusion, as access and usability are simpler compared to Bitcoin. The government hopes the new digital solution will reach a larger share of the population, who are still hesitant to use volatile cryptocurrencies for daily transactions.
The Role of Bitcoin: Reserve Asset and National Symbol
Despite the change, President Bukele has reaffirmed that Bitcoin will not be abandoned. The asset continues to make up the national reserve, with the government holding part of its treasury in BTC and promoting the country’s image as a crypto-friendly destination. Since 2021, El Salvador has accumulated about 5,800 BTC, according to official data, which is equivalent to approximately $300 million at current prices.
Bitcoin, therefore, takes on a more symbolic and strategic role: it serves as a diversification of reserves and a marketing tool to attract crypto companies and tourists. However, the practical use of BTC in retail and remittances is losing ground to more stable alternatives.
Impacts on the Market and Next Steps
El Salvador’s decision could influence other developing countries that see the local experience as a reference. By prioritizing stablecoins for daily activities and keeping Bitcoin as a reserve asset, the government seeks to balance innovation, stability, and popular acceptance. For investors, the news reinforces the role of stablecoins in the crypto ecosystem and may affect perceptions about BTC adoption as a mainstream currency.
The performance of Sivar over the coming months will be crucial to assess the success of the new strategy. Popular acceptance, reduced remittance costs, and continued international interest in El Salvador as a crypto hub will be key points for the market to watch.
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With information from BeInCrypto Brazil.
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Alexandre Bianchi
Fundador da Bianchi Capital e do Zayion AI. ~10 anos no mercado de ativos digitais, autor de referência e presença na mídia.
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