Bitcoin Beach in El Salvador Sees Decline! Restaurant Receives Only 1 BTC Payment in a Month, Customers Return to Traditional Card Payments
Author: Kurumi, Crypto City
Bitcoin Beach Payment Declines, Restaurant Receives Only 1 Bitcoin in a Month
Once regarded as a global benchmark for Bitcoin ($BTC) payment experiments, El Salvador's "Bitcoin Beach" is now facing a decline in everyday usage. Bitcoin Core developer Jon Atack recently shared his firsthand spending experience in El Zonte, noting that a local restaurant received almost no Bitcoin payments throughout August.
Atack, who has lived in El Salvador since 2022, stated that when he chose to pay with Bitcoin at a restaurant in El Zonte, the staff informed him that it was the first Bitcoin payment the establishment had received that month. Previously, it was quite common for customers to use Bitcoin, but now it has become "almost nonexistent."
When Atack asked what payment methods customers primarily use now, the staff replied that nearly everyone in the beach area uses credit cards. Atack then suggested leaving a tip in satoshis, but the staff even mentioned that they had forgotten how to operate the Bitcoin application, thus politely declining the tip.
However, Atack's experience comes from a single merchant and cannot directly represent the overall Bitcoin payment situation in El Zonte or El Salvador. Other local visitors have indicated that they have still used Bitcoin for purchases in El Zonte recently, and some merchants continue to display signs accepting Bitcoin payments.
National Usage Rate Continues to Decline, Only 8.1% in 2024
The situation in El Zonte aligns with trends presented in national surveys conducted in El Salvador in recent years. A survey by the Public Opinion Research Institute of the Central American University (UCA) shows that in 2024, only 8.1% of Salvadorans have used Bitcoin to purchase goods or pay for services, marking the lowest record since Bitcoin was granted legal tender status in 2021.
The usage rate of Bitcoin payments was 25.7% in 2021, dropped to 21% in 2022, further declined to 12% in 2023, and is projected to be only 8.1% in 2024. The survey interviewed 1,266 people, with a confidence level of 95% and a margin of error of approximately 2.75 percentage points.
Another survey conducted by Francisco Gavidia University yielded similar results, with about 92% of respondents indicating they did not use Bitcoin for transactions in 2024, while the actual usage rate was around 7.5%.
These surveys primarily account for the self-reported usage rates of the public and cannot directly represent the Bitcoin transaction volume of national businesses, but long-term data still shows that the proportion of Salvadorans using Bitcoin for everyday payments continues to decline.
Legal Tender Policy Shift, Merchant Acceptance of Bitcoin Becomes Voluntary
El Salvador officially granted Bitcoin legal tender status in September 2021, becoming the first country in the world to adopt such a policy. The government then launched the official Chivo Wallet, set up Bitcoin ATMs, and established a dollar exchange mechanism, hoping to encourage the public and businesses to use Bitcoin.
A significant policy shift occurred in 2025. To secure a $1.4 billion financing package from the International Monetary Fund (IMF) for 40 months, El Salvador amended its original Bitcoin Law, making it voluntary for private enterprises to accept Bitcoin payments, while taxes must be paid in US dollars.
The government also eliminated some mechanisms that previously ensured the free exchange of Bitcoin and US dollars and gradually reduced public sector participation in the Chivo Wallet. Merchants can decide whether to continue offering Bitcoin payments based on customer demand, operating costs, and their own willingness.
After the policy relaxation, the incentive for merchants to maintain the relevant equipment and operational processes, lacking actual transaction demand, has also diminished. For the average consumer, factors such as Bitcoin price volatility, wallet operation thresholds, and holders' tendency to hold long-term may also affect their willingness to make everyday payments.
-- Price
Government Holdings Increase While Private Payments Decline, Two Paths Diverge
The Bitcoin reserves held by the El Salvador government and the usage rate of private payments are showing different trends. Public tracking data indicates that as of August 25, El Salvador's related wallets hold approximately 7,756 Bitcoins, valued at about $615 million, with the number of Bitcoins held increasing by about 240 this year.
However, IMF documents provide a different interpretation of the government's Bitcoin holdings data. Documents signed between the El Salvador government and the IMF indicate that after the financing plan was approved, the total Bitcoin holdings of the public sector did not actively increase. The growth of Bitcoin shown in some government wallets may stem from asset transfers between different government-controlled addresses. Therefore, the changes in publicly displayed wallets do not directly reflect the frequency of Bitcoin payments made by Salvadorans.
El Zonte was once the starting point of El Salvador's Bitcoin experiment, where the local community began promoting the Lightning Network and Bitcoin payments even before the national policy was launched. Today, while the Bitcoin payment infrastructure still exists, how to increase the public's actual willingness to use Bitcoin in coffee, dining, and daily shopping has become a continuing challenge for this national-level Bitcoin experiment.
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