Bolivia has inked a historic bilateral agreement with El Salvador to promote cryptocurrency adoption, taking a significant step toward modernising the banking system.
The agreement, which is intended to boost Bolivia’s struggling economy and promote financial inclusion, follows in the footsteps of El Salvador, the first country in the world to make Bitcoin legal tender.
The deal marks a strategic shift for Bolivia, which is in the midst of an economic crisis and running at historically low international reserves.
Through digital assets, the country is seeking alternatives to traditional monetary systems to help stabilise its economy and increase access to financial resources.
A new phase of bilateral cooperation
The agreement was signed by the interim president of the Central Bank of Bolivia, Edwin Rojas Ulo, and the head of El Salvador’s National Commission of Digital Assets, Juan Carlos Reyes García.
The statement establishes a framework for technological and political collaboration centred on bitcoin use and the creation of safe digital infrastructures.
The two countries intend to cooperate to pursue measures targeted at increasing cryptocurrency use while ensuring the essential safeguards are in place.
The agreement also specifies procedures for sharing institutional knowledge and developing public policies to bridge the gap between existing banking institutions and emerging digital finance alternatives.
Rising crypto activity in Bolivia
The partnership comes in the wake of Bolivia’s 2024 decision to begin phasing out its long-standing ban on cryptocurrencies—a move that has led to a surge in digital asset transactions.
In the first half of 2025 alone, Bolivia recorded $294 million in cryptocurrency activity, reflecting growing public interest and broader adoption of digital assets.
As Bolivia navigates this transition, it is looking to El Salvador—a global benchmark for crypto adoption—for guidance.
The collaboration aims to support Bolivia in developing a framework to integrate cryptocurrencies into everyday economic activity through knowledge sharing and coordination between policymakers.
Addressing dollar shortages and financial gaps
Bolivia’s decision is motivated not only by innovation but also by the need to address serious budgetary realities.
A continuous lack of US dollars and increasing pressure on import financing have led the country to consider other solutions.
Cryptocurrencies may provide a lifeline for small enterprises and households with restricted access to banking services and foreign currency.
By reducing its reliance on established banking channels, the country aims to open up new economic opportunities.
The agreement envisions digital assets serving as both a practical tool and a policy instrument to increase economic participation.
A regional trend toward digital finance
The Bolivia–El Salvador agreement is a manifestation of the regional movement towards digital finance as a tool to counter systemic economic difficulties.
Such partnerships could become more prevalent as additional nations across Latin America weigh the role of digital currencies in their development strategies.
While the road to mass adoption is far from certain and fraught with regulatory and technical challenges, it nevertheless puts Bolivia among a growing list of nations interested in using relatively new technologies and ideas to modernise their respective economies.
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