Crypto Accounts for Less Than 2% of El Salvador’s Remittances – Has BTC Adoption Plan ‘Failed?’
Expansion reported that, per Central Reserve Bank (BCR) figures, remittances to individuals or firms in El Salvador hit the $588 million mark in January this year – an increase of 6.38% on the same month in 2022. But remittances made in “cryptocurrencies” represented just 1.63% of the total, the BCR noted.
In total, crypto worth $126.7 million was sent to crypto wallets in El Salvador in January.
This figure is a slight decline from last year. The BCR has previously revealed that between September 2021 and June 2022, 1.8% of the $6.4 billion total remittances sent to the nation were made in crypto.
Crypto Remittances Not Growing in El Salvador?
Remittances, mostly from overseas-based Salvadorans, are a major source of income for the country. And much fanfare was made of the bitcoin adoption law of September 2021. The government promised that BTC would provide more options and greater convenience for those sending and receiving remittances.
Indeed, the government even launched a dedicated BTC app, designed in large part to facilitate BTC remittances from overseas. But data from last year showed that only two in 10 people who initially downloaded the app are still using it.
Almost half a million Salvadoran households received remittances from abroad in the same time period, the media outlet noted.
Media-based critics have stated that “vanishingly few” Salvadorans now make use of Bitcoin, and that few recognize its worth as a settlements or remittances tool.
/4 To get citizens to use Bitcoin to transact in their daily lives the government created the Chivo App.— Oregon Blockchain Group (@oregonblock) March 1, 2023
Chivo acts as a Bitcoin wallet where users can send and receive Bitcoin for no fees.
Even after incentives, less than half of the population has actually used the app. pic.twitter.com/l0ANCi7i56
The Minister of Finance has previously responded to such claims by claiming that Salvadorans “continue to use” bitcoin in their daily lives.