El Salvador targets $9 billion in transfers, but chooses stablecoins

El Salvador is turning to stablecoins for remittances, further separating everyday payments from the country's pioneering Bitcoin experiment.

Sivar, a new national community and payments app developed by Modveon, will use Coinbase infrastructure to settle transfers in stablecoins on Base, according to a Sept. 29 announcement. Users in the US can fund transfers with debit cards, while recipients in El Salvador receive the value through wallets embedded in the app.

The rollout marks an evolution for a country that made Bitcoin legal tender in 2021 partly on the promise that the cryptocurrency could make cross-border payments cheaper. Five years later, El Salvador still promotes Bitcoin, but dollar-backed tokens are increasingly being deployed for payments.

Sivar abstracts the crypto infrastructure from users, allowing people unfamiliar with digital assets to send and receive money without managing the underlying blockchain transaction themselves.

Coinbase Chief Policy Officer Faryar Shirzad said the economics work because the transfers move entirely in digital dollars.

Sivar targets a $9 billion remittance corridor

The opportunity is substantial in a country where money sent home by Salvadorans abroad remains a major source of household income.

About $9 billion flowed into El Salvador through remittances in 2025, with roughly 92% originating in the US, Coinbase said. An estimated 1.6 million Salvadorans depend on those payments.

Sivar will charge a flat $2 per transfer regardless of size, targeting a market where conventional remittance fees can eat into smaller payments. Transactions between verified users will settle in stablecoins on Coinbase's Base network, while recipients can convert their balances to cash at more than 1,000 locations across El Salvador.

More than 25,000 Salvadorans had signed up before the launch, according to Coinbase. Each user receives a non-custodial wallet, while Coinbase provides the onramp, transfer APIs, and settlement infrastructure.

That approach differs from the government's original Bitcoin push, which required consumers to interact more directly with a volatile asset whose dollar value could change between receipt and spending.

Stablecoins preserve the dollar denomination Salvadorans already use while allowing settlement over blockchain networks, removing one of the main frictions that complicated Bitcoin's use as everyday money.

MoneyGram and Tether had already moved in

Sivar is entering a stablecoin payments market that was taking shape before its launch.

MoneyGram expanded its USDC-based stablecoin balance into El Salvador in April through a partnership with the Stellar Development Foundation, Crossmint and Circle. The service allows customers to receive money into a dollar-denominated digital balance, hold it there, and later withdraw cash through MoneyGram locations.

El Salvador was the first new Latin American market added after MoneyGram initially introduced the product in Colombia. The company said the broader system spans almost 500,000 retail locations across more than 200 countries and territories, giving stablecoins a bridge into communities where cash remains dominant.

The world's largest stablecoin issuer has also planted its corporate flag in the country.

Tether relocated its headquarters to El Salvador in 2025 after securing authorization as both a stablecoin issuer and digital-asset service provider. The company said the move would give it a base to develop products aimed at emerging markets and work with local businesses and government institutions.

Tether has separately integrated USDT with Bitcoin's Lightning Network, an effort designed to combine dollar-denominated payments with Bitcoin-based settlement infrastructure.

Those developments mean El Salvador increasingly hosts competing versions of the same proposition: using blockchain rails to move dollars more efficiently rather than requiring households to assume Bitcoin's price risk.

Bitcoin remains, but its role has narrowed

Despite this significant stablecoin push, it does not mean El Salvador is abandoning Bitcoin.

The country's Bitcoin Office marked the fifth anniversary of adoption this month by highlighting its Strategic Bitcoin Reserve, Bitcoin education in public schools, training for 80,000 civil servants, designated Bitcoin Zones and its CUBO+ developer program. Government data cited by the office puts the country's holdings at about 7,789 BTC.

However, the government's ability to keep building that reserve with public money has changed.

The International Monetary Fund (IMF) said this month that El Salvador has used no public resources to accumulate Bitcoin since its first program review. The government provided documentation showing subsequent increases came from private donations, and the IMF said it expects no further accumulation beyond documented donations.

That follows concessions made under El Salvador's $1.4 billion IMF program. Legal changes removed Bitcoin's essential features as mandatory legal tender, made private-sector acceptance voluntary and required taxes to be paid in US dollars.

The state also agreed to wind down its participation in the Chivo wallet, whose majority ownership and operations it has since transferred to a private operator.

The result leaves the country's crypto experiment looking different from what it was in 2021.

Bitcoin remains embedded in El Salvador's reserve strategy, education programs and national branding, even as public purchases have effectively stopped. Meanwhile, Sivar joins MoneyGram in testing whether stable digital dollars can succeed where everyday Bitcoin adoption struggled for moving money.

That division now gives El Salvador a different kind of crypto experiment to prove: whether Bitcoin can remain the strategic asset while stablecoins become the technology people actually use to send dollars home.