El Salvador has passed a new law that allows large financial institutions to offer Bitcoin and other digital asset services to wealthy investors. This move marks a strategic shift from the country’s initial focus on individual adoption to a new effort to attract institutional capital.
New Regulations for Crypto Investment
The new law allows financial institutions with a minimum of $50 million in capital to be classified as investment banks. These banks can then apply for licenses to offer crypto-related financial products to “sophisticated investors,” defined as those with over $250,000 in liquid assets. The new legislation allows these institutions to integrate existing crypto-related licenses into their banking licenses, enabling them to hold Bitcoin, issue tokens, and create crypto deals under the current regulatory framework.
A Shift from Retail to Institutional Focus
This new institutional focus follows a change in El Salvador’s earlier, retail-oriented approach. In 2021, the country made Bitcoin legal tender and mandated that businesses accept it. However, the government recently reversed this requirement and other public-sector Bitcoin initiatives to secure a $1.4 billion loan from the IMF.
Despite the initial push for widespread adoption, reports indicate that retail adoption was low, with only 1% of remittances using crypto and just 2 out of 10 Salvadorans adopting the technology. Furthermore, the country’s central bank and finance minister have confirmed to the IMF that El Salvador has not made new Bitcoin purchases since the loan agreement, despite claims from the Bitcoin Office. The reported daily purchases are instead a consolidation of existing Bitcoin from different government wallets.
August 2025, Cryptoniteuae
