Country’s Switch to Bitcoin Leads to Disaster

o keep up with the influx of new users, while the government’s official crypto app failed to appear on platforms like Apple and Huawei. The streets of El Salvador were filled with protestors surrounding the Supreme Court, only to be met by heavily armed riot police.

Since the implementation of Bitcoin as legal tender, El Salvador has faced numerous challenges. Rather than experiencing economic growth, the country has seen increased inflation, a rise in national debt, and a surge in poverty levels. As of early March 2025, less than 2 percent of the population has embraced this new financial technology, leading to little improvement in the overall economy.

With limited incentives for legitimate employment opportunities, El Salvador continues to struggle with crime and violence. President Bukele responded with a harsh crackdown on crime, resulting in a 205 percent increase in the country’s prison population between 2021 and 2024. Many citizens feel that the rise of cryptocurrency and the escalation of state violence are interconnected, creating a cycle of unrest and instability.

Despite efforts to mandate that all businesses in El Salvador accept Bitcoin as payment, President Bukele’s vision of attracting international investors and transforming the country into a crypto hub has fallen short. A video from 2022 depicts a crypto enthusiast attempting to purchase a beer with Bitcoin at a self-serve kiosk, only to face technological barriers. This scenario reflects the challenges and complexities that El Salvadorans face in adopting this new form of currency.

Despite the lack of enthusiasm from the population, President Bukele remains resolute in his commitment to the Bitcoin experiment. Plans for a lavish “Bitcoin City” aimed at attracting industry leaders and cryptocurrency enthusiasts are underway, displacing indigenous communities and destroying precious natural habitats in the process. In a surprising move, Bukele rejected a $3.5 billion loan from the IMF that would have imposed restrictions on government Bitcoin transactions, creating uncertainty about the country’s financial future.

El Salvador’s Bitcoin journey has been turbulent and filled with unexpected twists and turns. The initial optimism and excitement surrounding the adoption of cryptocurrency as legal tender have given way to economic challenges, social unrest, and environmental destruction. As El Salvador grapples with the aftermath of this bold experiment, the future remains uncertain, with the country’s fate hanging in the balance.