Bolivia is taking a major step toward embracing cryptocurrencies by forming a strategic alliance with El Salvador.

On July 30, the Central Bank of Bolivia (BCB) and El Salvador’s National Commission of Digital Assets (CNAD) signed a memorandum of understanding to support the exchange of expertise in digital asset regulation and blockchain technologies.

This partnership will enable both countries to collaborate on key areas such as blockchain intelligence, regulatory frameworks, and risk management tools.

El Salvador, led by President Nayib Bukele, has become a global example of crypto adoption. It was the first country to make Bitcoin legal tender and has continued to expand its crypto reserves through daily purchases.

While international bodies like the IMF have criticized these steps, El Salvador has mostly maintained its course by implementing new pro-crypto regulations. These actions have attracted crypto firms like Tether to the Central American country.

Bolivia’s crypto ecosystem

Bolivia aims to use the El Salvador experience to implement and oversee crypto-related policies. Officials say the agreement is part of a broader effort to build safe, well-regulated crypto ecosystems that could attract foreign investment and promote financial innovation.

Bolivian authorities highlighted the growing relevance of digital assets in cross-border transactions and acknowledged the value of El Salvador’s early adoption of crypto in shaping their own policy path.

The partnership follows a significant policy change in Bolivia. In June 2024, the government passed Resolution 082/2024, overturning a long-standing crypto ban.

The new regulation legalized digital assets for trading and allowed electronic payment methods to support transactions.

As a result, Bolivia saw a surge in crypto activity. Transaction volumes jumped from $46.5 million to nearly $294 million between June 2024 and June 2025.

To further integrate crypto into its economy, Bolivia authorized its national oil company, YPFB, to use digital currencies for fuel imports. The decision helps manage foreign exchange shortages and maintain fuel subsidies amid economic pressures.

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The Bolivian central bank reported on June 27 that domestic crypto transactions totaled $430 million in the 12 months since regulators reopened formal payment rails, a 630% jump over the previous year. 

The Banco Central de Bolivia (BCB) reported that users processed 10,193 operations worth BOB 611 million as of May 31, 2025, approximately $88 million. 

Natural persons executed 86% of those transfers, and men accounted for 77% of that cohort. The report counted flows only on channels registered with the financial system supervisor ASFI, leaving peer-to-peer activity outside the tally. Binance-linked rails moved the largest share. 

First-half volumes highlight the pace. Crypto payments climbed from $46.5 million in the first six months of 2024 to $294 million in the comparable 2025 window.

Oversight strategy

The growth follows Resolution 082/2024, issued last June 25, which formally recognized “virtual assets” and allowed banks to route customer orders to exchanges.

Bolivia extended the use of crypto to the public sector on March 13, when authorities permitted the national energy company YPFB to pay for fuel imports with digital assets, citing an acute dollar shortage and ongoing fuel supply strain.

The BCB stated that it would publish quarterly dashboards on exchange activity and collaborate with the tax authority, SIN, to integrate wallet analytics with existing value-added tax records. 

Banks must file daily reports on crypto outflows and maintain real-time screening against the Office of Foreign Assets Control sanctions list. Regulators flagged 27 accounts for enhanced examination but imposed no fines in the period reviewed.

Officials have warned that custodial wallets are excluded from the national deposit insurance scheme. 

They urged users to keep their private keys offline and to verify the spelling of the domain name before logging in. The literacy modules include live demonstrations of deep-fake investment scams that recently targeted WhatsApp groups in La Paz. 

New legal guardrails and education push

President Luis Arce’s government advanced the framework in May with Supreme Decree 5384, creating licenses for fintech firms and virtual-asset service providers. 

The decree mandates anti-money laundering controls aligned with GAFILAT guidance and defines tokenized assets, blockchain networks, and custody obligations. ASFI has 40 working days to publish implementing rules.

The BCB paired the legal overhaul with a national literacy campaign. Officials scheduled workshops in all nine departments to cover private-key management, price volatility, and fraud prevention. 

“Modern digital tools can improve economic activity, but citizens must understand the risks,” the report said.

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Bolivia has authorized its state-run energy company, YPFB, to use crypto for fuel imports as the country struggles with a worsening dollar shortage and fuel crisis.

The government approved the move to sustain fuel subsidies and secure essential energy supplies amid declining foreign currency reserves.

Gas stations across Bolivia have seen long lines as fuel shortages persist. Protests have erupted in several regions as citizens face growing difficulties in accessing fuel.

Years of declining natural gas production and dwindling exports have forced Bolivia to rely more on imports, but a lack of dollars has complicated payments to foreign suppliers.

A YPFB spokesperson confirmed that the system for crypto transactions is now in place and the firm intends to carry out trades using digital assets. A government official clarified that YPFB has not yet executed a crypto payment but plans to do so soon.

Shifting stance

Bolivia’s central bank initially banned crypto in 2020, citing concerns over financial stability and illicit transactions. However, the country pivoted its stance and lifted the ban in 2024.

The government’s decision to allow crypto payments for fuel imports marks a major policy shift. Other Latin American countries facing currency crises, such as Venezuela and Argentina, have also turned to digital assets to facilitate trade amid financial restrictions.

Bolivia’s economic struggles stem from its dependence on natural gas exports, which have steadily declined. Brazil and Argentina, once major buyers of Bolivian gas, have reduced their reliance on the country’s supply. A lack of new gas discoveries and foreign investment has worsened the crisis, limiting Bolivia’s ability to generate foreign reserves for imports.

Details unclear

YPFB has not disclosed which cryptocurrencies it will use or whether it will convert digital assets into fiat currency before making payments. It is also unclear whether the firm will hold any assets in reserve.

Additionally, the government has not detailed how it will manage the volatility associated with crypto. It also remains unclear whether suppliers will accept direct crypto payments or require an intermediary.

Bolivia’s move to adopt crypto for energy transactions highlights its deepening economic crisis and the government’s urgency to secure fuel supplies. If successful, the policy could reshape the country’s financial strategy and signal a broader shift toward digital assets.