El Salvador Shifts Focus to Stablecoins for Remittances

El Salvador is pivoting toward dollar-backed stablecoins to facilitate economic transactions, five years after adopting Bitcoin as legal tender. The government, led by President Nayib Bukele, has retained its state-held reserve of approximately 7,800 BTC. The new state-backed application, Sivar, developed with startup Modveon, utilizes Coinbase's Base network to process digital dollar transfers. This move follows the removal of mandatory Bitcoin acceptance in January 2025, a condition set by the IMF for a $1.4 billion loan. Tether has also established its headquarters in San Salvador after securing a digital asset service provider license.