Bolivia looks to El Salvador for crypto guidance as locals turn to digital currencies

A year after lifting its ban on cryptocurrencies, Bolivia has partnered with El Salvador to advance its digital asset policy and infrastructure. Is Bolivia going all in on crypto?

Bolivia, a country grappling with economic instability, and El Salvador, one of the first nations to adopt Bitcoin as legal tender, have joined hands to promote crypto as an alternative to traditional currencies.

According to a letter published by the Central Bank of Bolivia (BCB), the two countries have signed a memorandum of understanding (MoU) to facilitate mutual cooperation in crypto policy development, regulatory strategy, and the exchange of blockchain intelligence tools. 

The agreement is effective immediately and remains valid for an indefinite period.

What does Bolivia hope to gain from partnering with El Salvador?

Bolivia sees El Salvador’s early entry into the crypto space as a model worth studying. By becoming the first nation to recognize Bitcoin as legal tender in 2021, El Salvador gained both praise and scrutiny. 

Bolivia’s central bank now hopes to learn from that experience, particularly in developing effective crypto regulation, managing risks, and integrating blockchain into its financial infrastructure.

According to the BCB’s official letter, the goal is to promote “safe and regulated” digital asset ecosystems that can attract investment and create new economic opportunities. The central bank said it views cryptocurrencies as a viable and reliable alternative to traditional currencies, particularly for families and small entrepreneurs.

Particularly, CNAD, the regulatory body supervising the crypto sector in El Salvador, will assist Bolivia in understanding the operational and regulatory challenges associated with digital assets. 

El Salvador’s experience as the first country to adopt Bitcoin as legal tender positions it as a strategic partner for Bolivia, which is still in the early stages of its national crypto framework.

Why is Bolivia pursuing this now?

The timing is no coincidence. The agreement comes just one year after Bolivia repealed its long-standing crypto ban in June 2024. That reversal opened the door for banks to process Bitcoin and stablecoin transactions.

Since then, crypto trading volumes have surged. According to official data, Bolivia recorded $294 million in crypto transactions by mid-2025, up from $46.8 million in the months following the ban.

Years of economic hardship have already pushed many Bolivians to seek alternatives. The country’s foreign currency reserves have plummeted nearly 98% over the past decade, from $12.7 billion in 2014 to just $165 million in April 2025. 

The national currency, the boliviano, remains in use, but its purchasing power has eroded significantly. On the black market, it trades at steep discounts, and fears of further devaluation have pushed many to seek stability in the form of U.S. dollars or dollar-pegged cryptocurrencies like Tether’s USDT.

Bolivians are actively using cryptocurrencies

Small businesses, including restaurants, barbershops, and beauty salons, now accept payments in Bitcoin and USDT. In many urban centers, it’s reportedly not uncommon to see menus or price tags denominated directly in stablecoins.

In a statement earlier this year, Tether CEO Paolo Ardoino described this grassroots shift as a “quietly revolutionary” development while sharing images of shops in Bolivia pricing their goods in USDT.

According to former Central Bank President Jose Gabriel Espinoza, daily USDT transaction volumes reached $600,000 in 2025, up sharply from previous years. While this remains a fraction of the overall economy, the rate of adoption continues to grow rapidly.

As previously reported by crypto.news, Bolivian banking giant Banco Bisa has led the way by launching a custody service for Tether’s USDT in October last year.  Meanwhile, local media reported in March that Bolivia’s state-owned oil and gas firm, YPFB, had confirmed plans to begin using cryptocurrency for fuel imports.