El Salvador launches stablecoin remittance app targeting $9 billion market

El Salvador is deploying stablecoins rather than Bitcoin for remittances, a shift that reveals how blockchain infrastructure is being used to move dollars efficiently rather than push cryptocurrency adoption. The strategy may prove more viable for everyday payments, but it narrows Bitcoin’s role from the broad financial inclusion promise that framed the country’s 2021 legal tender adoption.

• Sivar, a new national payments app, targets $9 billion in annual remittances using stablecoins on Coinbase’s Base network with a flat $2 fee per transfer.
• About $9 billion flowed into El Salvador through remittances in 2025, with 92% originating in the US and 1.6 million Salvadorans depending on those payments.
• MoneyGram and Tether have already launched competing stablecoin payment systems in the country, indicating a consolidating market for blockchain-based dollar transfers.

• $9 billion El Salvador’s annual remittance inflow, the target market for stablecoin services
• 7,789 BTC Government’s Strategic Bitcoin Reserve holdings as of September 2025
• 92% Share of El Salvador’s remittances originating from the United States
• $2 Flat fee per transfer on Sivar, regardless of amount sent

El Salvador is pursuing stablecoins to capture its massive remittance market, stepping back from the cryptocurrency vision that made Bitcoin legal tender five years ago. According to reporting by CryptoSlate, Sivar, a community and payments app developed by Modveon, launched on September 29 (Tuesday) using Coinbase infrastructure to settle transfers in dollar-backed tokens on Base, a blockchain network. The app allows US users to fund transfers with debit cards while recipients in El Salvador receive value through embedded wallets, abstracting away the underlying crypto mechanics that once characterized the government’s Bitcoin push. More than 25,000 Salvadorans had already signed up before the official launch.

A $9 billion remittance corridor with a $2 flat fee

The remittance market represents a critical economic lifeline for El Salvador. About $9 billion flowed into the country through remittances in 2025, with roughly 92% originating in the US, according to Coinbase data cited in the announcement. An estimated 1.6 million Salvadorans depend on those payments, making the corridor one of Latin America’s largest channels for household income transfers.

Sivar’s pricing structure targets the pain points of conventional remittance services. The app charges a flat $2 per transfer regardless of size, a model designed to compete with traditional services where fee structures can substantially erode smaller payments.

Transactions between verified users settle in stablecoins on Coinbase’s Base network, with recipients able to convert their balances to cash at more than 1,000 locations across the country. Each user receives a non-custodial wallet, while Coinbase provides the onramp, transfer APIs and settlement infrastructure.

Stablecoins replace Bitcoin’s volatility for everyday payments

The shift toward stablecoins reflects a practical solution to the friction that complicated Bitcoin adoption for daily transactions. Unlike Bitcoin, whose dollar value fluctuates, stablecoins preserve the dollar denomination Salvadorans already use while enabling settlement over blockchain networks. Coinbase Chief Policy Officer Faryar Shirzad stated that the economics work because transfers move entirely in digital dollars, removing the requirement for users to manage volatile crypto assets.

Sivar enters a market already taking shape. MoneyGram expanded its USDC-based stablecoin balance into El Salvador in April 2024 through a partnership with the Stellar Development Foundation, Crossmint and Circle, allowing customers to receive money into a dollar-denominated digital balance and withdraw cash through MoneyGram locations. The service spans nearly 500,000 retail locations across more than 200 countries and territories.

Tether, the world’s largest stablecoin issuer, relocated its headquarters to El Salvador in 2025 after securing authorization as both a stablecoin issuer and digital-asset service provider. The company stated the move would give it a base to develop products for emerging markets and work with local institutions.

Bitcoin’s narrowing role under IMF constraints

The turn toward stablecoins contrasts sharply with El Salvador’s 2021 Bitcoin legal tender law, which promised cheaper cross-border payments and broader financial inclusion. The country’s Bitcoin Office highlighted its Strategic Bitcoin Reserve, Bitcoin education initiatives and training programs during September’s fifth-anniversary commemoration, indicating continued government commitment to the asset. Government data puts the country’s holdings at about 7,789 BTC.

However, the IMF’s oversight has constrained the state’s ability to accumulate Bitcoin with public funds. The IMF said this month that El Salvador has used no public resources to accumulate Bitcoin since its first program review, with the government providing documentation showing subsequent increases came from private donations. Legal changes made private-sector Bitcoin acceptance voluntary, required taxes to be paid in US dollars and removed Bitcoin’s status as mandatory legal tender. The state also agreed to wind down its participation in the Chivo wallet, transferring majority ownership and operations to a private operator.

That division leaves El Salvador testing two competing propositions simultaneously: whether Bitcoin can remain a strategic reserve asset while stablecoins become the practical technology for everyday cross-border payments.

The BlockWest read. The remittance market’s shift to stablecoins reveals institutional capital’s preference for stable value rails over volatile assets. For El Salvador, this means the state’s Bitcoin reserve strategy operates separately from the payment infrastructure its citizens actually use. The tension between these two tracks will determine whether blockchain adoption in emerging markets follows a two-layer model: strategic Bitcoin holdings paired with stablecoin transaction layers.

The open question is whether Sivar, MoneyGram and Tether’s competing systems will consolidate or fragment the Salvadoran stablecoin corridor, and whether additional regulatory constraints from the IMF program will affect the government’s ability to expand its Bitcoin reserve through private donations or other mechanisms beyond the documented baseline.

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