In September 2021, El Salvador, a small Central American nation, made headlines by becoming the first country to integrate Bitcoin into its national economy—not just as a currency, but as a springboard into crypto trading. Under President Nayib Bukele, the country took a bold leap into the world of digital finance.
A Law That Opened the Crypto Markets
The “Bitcoin Law,” passed on June 9, 2021, required all businesses to accept Bitcoin for payments, positioning El Salvador as a global pioneer in crypto finance. By September 7, Bitcoin was recognized as legal tender alongside the U.S. dollar. More significantly, the government launched Chivo Wallet—a digital platform that enabled not only payments but also crypto trading, giving each citizen a $30 bonus in BTC to encourage participation.
Global Reactions and Market Impacts
Crypto traders and enthusiasts hailed the move. Industry leaders like Jack Dorsey and Michael Saylor praised the effort as a major milestone in Bitcoin adoption. However, institutions like the IMF and World Bank raised red flags, warning about risks tied to crypto market volatility. On the streets, protests highlighted skepticism among citizens about mandatory usage and potential trading losses.
Trading on the National Level
El Salvador took an active role in crypto trading, with President Bukele often tweeting real-time updates on Bitcoin purchases for the national treasury. The country effectively became a state-level crypto trader. However, when Bitcoin crashed from a peak of $69,000 to under $20,000 in 2022, the nation faced major paper losses—triggering debates over strategy and acc
ountability.