Only 7.5% of Salvadorans use crypto, new survey reveals
Despite banks and merchants across the country adjusting to Bitcoin adoption
El Salvador was the first to accept Bitcoin as a valid currency, making onlookers believe in the crypto's growing adoption in the country. However, a new survey shows that this is shockingly not the case.
Francisco Gavidia University (UFG) recently conducted the UFG First Rumbo Pais 2024 survey, titled People Have Faith, that showed shocking results about the nation’s crypto adoption: only 7.5% of respondents reportedly use cryptocurrency.
The survey went on to reveal that a whopping 92% of Salvadorans do not turn to Bitcoin for their everyday transactions. The remaining 0.5% did not answer the question.
OVER 90% OF SALVADORANS AVOID USING BITCOIN
— IBC Group Official (@ibcgroupio) October 16, 2024
A recent survey dropped and revealed that a whopping 92% of Salvadorans aren’t using Bitcoin for transactions, even with President Bukele riding high in popularity.
Only 7.5% are actually engaging with BTC, showing a slight dip in… pic.twitter.com/GnvQNhbmDt
As part of the survey, proponents interviewed 1,224 adult citizens in the country. Most respondents were 18 to 29 years old, with the majority (more than 71%) from urban areas. The proponents asked questions regarding pressing economic and political issues.
Notably, the survey observed that only 1.3% of respondents agreed that Bitcoin must be the El Salvador's main bet. Most respondents said that the country should focus on education and industry.
Since El Salvador is known for its adoption of Bitcoin and crypto in general, the survey results reveal a stark “expectation vs. reality” scenario. It also raises questions regarding how effective the initiatives of the government really are.
Interestingly, another earlier survey conducted by the public opinion institute of the University of Central America made a similar discovery in 2023: as many as 88% of Salvadorans did not use Bitcoin in their usual transactions.
El Salvador's Bitcoin adoption
President Nayib Bukele pushed the brave move to adopt Bitcoin in 2021.
With a strong belief in Bitcoin, the President exerted efforts to attract foreign capital. Part of the plan was the promise to implement a Bitcoin City and provide Bitcoin “Freedom” Visas, as reported by Cointelegraph.
The government was hopeful that Bitcoin adoption would prompt more people to go into the financial system. Remittances—money sent home from family working abroad—is a crucial income source for many families and was also a factor for this decision.
The adoption of cryptocurrency was seen as a potential way to reduce international exchange charges made by the traditional banking system. As Bitcoin allowed cheaper, faster, and direct transfers, it was perceived as a viable solution.
To make crypto more accessible, the government even released the Chivo wallet, which is its official digital Bitcoin vault. Chivo wallet users can avail instant US dollar conversions and cash withdrawals in Bitcoin ATMs.
Banks and merchants across the country also adjusted to Bitcoin adoption. In fact, Banco Hipotecario began to offer loans backed by Bitcoin, enabling customers to provide BTC as collateral for receiving US dollars. Banco Agricola also allows Bitcoin for paying credit cards, merchant services, and loans.
Lagging Bitcoin uptake
Despite this incredible step forward, adopting crypto for remittances did not gain momentum. El Salvador Info noted that Salvadorans were reluctant to incorporate it.
In fact, the country's Central Reserve Bank revealed that only around 1.1% of total remittances in the country involved cryptocurrency. Most Salvadorans still turn to US dollars as a base for remittance sending and receipt.
The bank also revealed that remittances through crypto wallets dropped by 3.51% in 2024 compared to the previous year.
Media outlet Criptonoticas has noted that among Salvadorans, the rate of Bitcoin adoption sits at roughly 20%. And a January 2024 study conducted by José Simeón Cañas Central American University (UCA) found that Bitcoin adoption rates are 12%.
In spite of the government's enthusiastic efforts, these findings show that Salvadorans are seemingly reluctant to accept Bitcoin.
In an interview with TIME Magazine last August, President Bukele said, “Bitcoin hasn't had the widespread adoption that [we] hoped for,” adding that “the positive aspect is that it is voluntary; [they] have never forced anyone to adopt it”.
President Bukele further explained that “[We] offered it as an option, and those who chose to use it have benefitted from the rise in Bitcoin.”
However, regardless of these shocking findings, the country has gained positive feedback from the International Monetary Fund (IMF). Previously, the IMF was skeptical about the nation's crypto adoption, but now, it no longer sees Bitcoin as a financial risk to El Salvador.
