El Salvador's newest national payments push runs on dollar-backed stablecoins, not Bitcoin. Sivar, a community and payments app developed by Modveon, will use Coinbase infrastructure to settle remittances in stablecoins on Base, Coinbase's Ethereum layer-2 network, according to a Sept. 29 announcement from the exchange.

Users in the United States can fund transfers with debit cards, while recipients in El Salvador receive value through wallets embedded in the app. The design abstracts the blockchain layer entirely: senders and recipients never manage the underlying transaction themselves. Coinbase Chief Policy Officer Faryar Shirzad said the economics work because the transfers move entirely in digital dollars.

The scale of the target market is substantial. Roughly $9 billion flowed into El Salvador through remittances in 2025, with about 92% originating in the US, according to Coinbase. An estimated 1.6 million Salvadorans depend on those payments.

Sivar will charge a flat $2 per transfer regardless of size, positioning itself against conventional remittance fees that disproportionately burden smaller payments. Transactions between verified users settle in stablecoins on Base, and recipients can convert balances to cash at more than 1,000 locations across El Salvador. More than 25,000 Salvadorans signed up before launch, Coinbase said. Each user receives a non-custodial wallet, while Coinbase supplies the onramp, transfer APIs and settlement infrastructure.

A narrowed role for Bitcoin

The rollout marks a notable evolution for the country that made Bitcoin legal tender in 2021, partly on the promise that cryptocurrency could make cross-border payments cheaper. Five years later, El Salvador still promotes Bitcoin, but dollar-backed tokens increasingly handle the payments function.

The distinction matters operationally. The government's original Bitcoin push required consumers to interact directly with a volatile asset whose dollar value could shift between receipt and spending. Stablecoins preserve the dollar denomination Salvadorans already use while settling over blockchain networks, removing the price-risk friction that complicated Bitcoin's use as everyday money.

Bitcoin has not disappeared from the national strategy. The country's Bitcoin Office marked the fifth anniversary of adoption this month by highlighting its Strategic Bitcoin Reserve, Bitcoin education in public schools, training for 80,000 civil servants, designated Bitcoin Zones and the CUBO+ developer program. Government data cited by the office puts the country's holdings at about 7,789 BTC.

But the government's ability to build that reserve with public money has narrowed. The International Monetary Fund said this month that El Salvador has used no public resources to accumulate Bitcoin since its first program review. The government provided documentation showing subsequent increases came from private donations, and the IMF said it expects no further accumulation beyond documented donations.

Those constraints stem from El Salvador's $1.4 billion IMF program. Legal changes removed Bitcoin's mandatory legal tender features, made private-sector acceptance voluntary and required taxes to be paid in US dollars. The state also agreed to wind down its participation in the Chivo wallet, transferring majority ownership and operations to a private operator.

A market already taking shape

Sivar enters a stablecoin payments market that was forming before its launch. MoneyGram expanded its USDC-based stablecoin balance into El Salvador in April through a partnership with the Stellar Development Foundation, Crossmint and Circle. The service lets customers receive money into a dollar-denominated digital balance, hold it, and withdraw cash through MoneyGram locations. El Salvador was the first new Latin American market added after the product's initial introduction in Colombia. MoneyGram said the broader system 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 said the move gives it a base to develop products for emerging markets and to work with local businesses and government institutions. Tether has separately integrated USDT with Bitcoin's Lightning Network, combining dollar-denominated payments with Bitcoin-based settlement infrastructure.

The result is that El Salvador increasingly hosts competing versions of the same proposition: using blockchain rails to move dollars efficiently rather than asking households to assume Bitcoin's price risk.

The country's experiment now splits into two tracks. Bitcoin remains embedded in the reserve strategy, education programs and national branding, even as public purchases have effectively stopped. Sivar and MoneyGram are testing whether stable digital dollars can succeed where everyday Bitcoin adoption struggled. The question El Salvador will answer over the coming years is whether Bitcoin can remain the strategic asset while stablecoins become the technology Salvadorans actually use to send money home.