El Salvador’s Legislative Assembly has passed legislation creating a $150 million dollar Bitcoin Trust and supporting the development of crypto infrastructure and services across the country.
The bill passed on Aug. 31, with 64 officials voting in favor and 14 opposing the trust’s creation. The Trust is designed to facilitate conversion of Bitcoin into U.S. Dollars, and support the roll out of vital technological infrastructure enabling widespread adoption of crypto assets.
The news comes just one week before the country’s controversial Bitcoin Law is set to take effect. The impending legislation will recognize BTC as legal tender across El Salvador and is slated to take effect on September 7th. Currently, U.S. dollars are used as legal tender in the country.
The Development Bank of El Salvador (Bandesal) has been appointed to oversee the trust’s operation.
The $150 million will be redirected from the country’s $500 million loan with the Central American Bank for Economic Integration (CABEI). The CABEI loan was originally taken for the purpose of economic recovery for small and medium sized businesses.
Of those funds, $23.3 million is earmarked to support the installation of government-backed crypto ATMs – allowing local citizens to exchange between Bitcoin and USD. $30 million has also been designated to offer incentives to encourage adoption of the Government’s digital wallet, Chivo.
In June, President Nayib Bukele announced the government would airdrop $30 worth of Bitcoin to every Salvadoran adult who downloads the Chivo wallet. However, El Salvador’s current population is 6.5 million, suggesting the government either believes adoption will be lower or has not allocated enough Bitcoin to go around.
In related new today asset tokenization and financial infrastructure company Koibanx announced it had signed a deal with the government of El Salvador to develop the country’s digital currency infrastructure with Algorand’s open source block chain at the core.
El Salvador’s Bitcoin Law has been met with some serious criticism and skepticism from international organizations and its own citizenry.
Minister of Economy, María Luisa Hayém Brevé said the government was focused on crypto currency education and using crypto incentives as a means to soothe the high amount of uncertainty within its population.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.
Recommended Content
Editors’ Picks

Ripple risks extending losses despite Ripple-SEC motion to release escrowed $125 million
XRP comes under immense pressure, falling toward $2.09 as Israel and Iran escalate conflict. Ripple and the SEC file a joint motion requesting the release of $125 million held in escrow.

Crypto Today: Bitcoin, Ethereum, XRP clamber for support amid escalating volatility on Israel-Iran tensions
The cryptocurrency market has been hit by a sudden wave of extreme volatility, triggering widespread declines as global markets react to tensions between Israel and Iran.

Sui Price Forecast: Sui eyes triangle fallout below $3 as Open Interest, TVL plunge
Sui (SUI) edges lower by over 5% at press time on Friday, concurrent with the broader crypto market crash due to the escalation of the conflict between Israel and Iran.

Bitcoin eyes a drop toward $100,000 amid cautious sentiment as Middle East tensions escalate
Bitcoin price edges below $105,000 on Friday after falling 4% over the last two days. Market sentiment sours as conflict in the Middle East escalates, with over $1.15 billion in liquidation across crypto markets.

Bitcoin: BTC could slump to $100K amid Trump-Musk tussle
Bitcoin (BTC) tumbled to a low of $101,095 on Friday amid volatility in the market. The effect of the tussle between United States (US) President Donald Trump and Tesla Chief Elon Musk negatively influenced the NASDAQ and Tesla's stock price on Thursday, although both are recovering on Friday.