El Salvador amended its Bitcoin Law in early 2025 under its IMF arrangement. Decree No. 199, published on 30 January 2025 and in force from 30 April 2025, made Bitcoin acceptance voluntary for private parties, repealed tax payment in Bitcoin and removed state-provided conversion mechanisms. Digital asset issuers and service providers are supervised by the CNAD, and the BCR sets standards for Bitcoin service providers.
| Status | Legal |
| Risk Score | 25/100 (Low Risk) |
| Region | central america |
| Currency | USD |
| Adoption Rank | #1 |
| Capital Gains (Personal) | Bitcoin exchanges are not subject to capital gains tax (Bitcoin Law Art. 5); other capital gains taxed at 10% or 30% |
| Capital Gains (Corporate) | 30% corporate income tax; Bitcoin exchanges exempt from capital gains tax (Bitcoin Law Art. 5) |
| VAT on Crypto | No |
| Staking Tax | No specific guidance |
| Airdrop Tax | No specific guidance |
Under Article 5 of the Bitcoin Law, which remains in force after the 2025 amendment, exchanges in Bitcoin are not subject to capital gains tax for any taxpayer. Bitcoin is no longer mandatory to accept and taxes can no longer be paid in Bitcoin. Gains on other crypto-assets follow general rules (capital gains 10% or 30%, corporate income tax 30%) unless covered by Digital Assets Issuance Law incentives.
| Required | Yes |
| Regulator | CNAD |
| Framework | Bitcoin Law (2021, amended Feb 2025) + Digital Assets Issuance Law (2023) |
| Ease | easy |
| Cost (USD) | $5,000 - $50,000 |
Digital wallet operators and Bitcoin service providers must obtain BCR authorization. AML/KYC mandatory with 15-year record retention. Bitcoin acceptance now voluntary.
Enforcement activity has been minimal. The government's focus has been on promoting adoption rather than enforcement. CNAD is still building its regulatory capacity.
| KYC Required | Yes |
| Travel Rule | Yes |
| FATF Member | No |
| FATF Status | partially_compliant |
| FATF Body | CFATF |
| Suspicious-Activity Reporting | Yes |
Status: Legal
El Salvador has not imposed restrictions on DeFi. The government's pro-crypto stance extends to decentralized finance, though specific DeFi regulation does not yet exist.
Status: regulated
Stablecoins are explicitly defined and regulated under the LEAD 2023 (as amended August 2024). Definition: a digital asset designed to maintain a stable value, referenced or backed by one or more fiat currencies or other low-volatility assets. Public stablecoin offerings must follow designated procedures with full disclosure requirements. CNAD is the sole regulator. Issuance license required for stablecoin issuers. USD is the only legal tender (Bitcoin tender status removed Jan 2025). Tether Gold (XAUT) is one documented permitted stablecoin. USD-pegged stablecoins widely used operationally.
Status: no_rules
No NFT-specific regulation. The Digital Assets Issuance Law provides a general framework that may cover NFTs with investment characteristics.
| Legal | Yes |
| Electricity Cost | $0.14/kWh |
| Renewable Energy | 65% |
| Infrastructure | fair |
Mining is legal and supported by the Bitcoin Law; infrastructure is developing but limited compared to larger markets.
| Stability | moderate |
| Sanctions | No |
| Corruption Index | 33/100 |
| Banking Access | moderate |
| Sanctions Program Active | No |
Risk Factors
El Salvador is politically stable with moderate governance challenges. It is not under international sanctions. The country has embraced Bitcoin legally but faces risks from crime and economic factors.
El Salvador amended its Bitcoin Law in early 2025 under its IMF arrangement. Decree No. 199, published on 30 January 2025 and in force from 30 April 2025, made Bitcoin acceptance voluntary for private parties, repealed tax payment in Bitcoin and removed state-provided conversion mechanisms. Digital asset issuers and service providers are supervised by the CNAD, and the BCR sets standards for Bitcoin service providers.
El Salvador is classified by FATF as: partially_compliant.
Yes, licensing is required for VASPs.
KYC is mandatory for crypto businesses.
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Explore IT Services →Last reviewed: 2026-09-04 · Data source: Soken Crypto Legal Map
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