El Salvador’s bitcoin experiment makes tech tourists happy but the locals are

Cash used to be king for Carolina Reyes. She would only hand over hearty snacks from her grill on the Pacific coast of El Salvador in exchange for green US dollar bills or rusty old dimes.

But now she is selling her pupusas — the country’s signature stuffed cornbreads — for cryptocurrency.

“It was hard to get used to at first, but I’m getting pretty good at using the app,” she says with a grin, proudly flashing the Bitcoin Beach wallet she uses to receive payments.

Like many Salvadorans, Reyes has never had a bank account. Now she can accept electronic payments from customers — which is useful when they have no cash to hand.

But the 42-year-old mother of four did not jump into the complex world of cryptocurrencies out of curiosity.

Salvadoran businesses were required to accept bitcoin from September 2021, when President Nayib Bukele made the central American country the first in the world to make cryptocurrency legal tender.

The move is already transforming El Salvador’s image and has sparked a boom in tourism. Eventually it will make the country a regional tech hub and lift it out of poverty, Bukele says, with the rest of the world following suit.

But the move is unprecedented. Foreign governments are concerned that bitcoin’s decentralised payments could strengthen the country’s powerful drug trafficking gangs. Economists fret that it could bankrupt the already poor nation. 

“I was excited by bitcoin, it seemed good,” Reyes says, as her three daughters wash green vegetables behind her. But she has heard that outside of the tourist region where she lives few want to use it and half of El Salvador’s six million people cannot, as they have no internet access.

“Do you know what? I’m starting to wonder if it’s a good idea, but maybe here, in El Salvador, it simply won’t work.”

From surfing to crypto

Around El Salvador’s postcard black volcanic beaches, bitcoin has already become a hit.

“With all the incredible places that you could visit in Latin America, why else would you come to El Salvador?” says James, a British tourist and cryptocurrency aficionado, shrugging his shoulders. “Bitcoin!”

Room reservations have surged since the cryptocurrency became legal tender alongside the US dollar in 2021.

“Before it was all ‘Surf City’ and now it’s all ‘bitcoin’,” says Carlos Marenco, owner of The Beach Break Hotel in El Zonte, laughing. “For us personally, it’s great business.”