EL SALVADOR Law and Practice Contributed by: Héctor Torres, Annette Herrera and Daniel Leiva, Torres Legal
Torres Legal Calle Cuscatlán No. 4312
Col. Escalón San Salvador El Salvador
Tel: +503 25386300 Fax: +503 25386300 Email: contact@torres.legal Web: www.torres.legal
1. Overview of Blockchain and Crypto- Assets 1.1 Blockchain El Salvador has been at the forefront of blockchain adoption in Latin America, driven primarily by the landmark passage of the Bitcoin Law ( Ley Bitcoin ) in June 2021, which made Bitcoin legal tender alongside the US dollar and laid the groundwork for a broader institutional embrace of blockchain technology. The subsequent enactment of the Digital Assets Issuance Law ( Ley de Emisión de Activos Digitales – LEAD) in January 2023 further consolidated the country’s posi- tion as a regional hub for digital asset innovation, pro- viding a structured legal framework for the issuance and trading of tokenised instruments. 1.1.1 Evolution of Uses of Blockchain Development and Current Use Cases Over the past 12 months, blockchain use in El Sal- vador has matured beyond the initial wave of Bitcoin adoption focused on payments and remittances. Pri- mary use cases now include: • the tokenisation of real-world assets (RWAs) such as real estate and receivables, regulated under the LEAD; • structured digital debt offerings by private issuers seeking access to international capital markets through blockchain-based instruments; and • government-adjacent initiatives exploring the use of distributed ledger technology (DLT) for public registry and transparency functions.
The National Commission for Digital Assets ( Comisión Nacional de Activos Digitales – CNAD) was established by the LEAD as the supervisory authority, and had by 2026 registered and authorised a growing pipeline of token issuers and digital asset service providers (DASPs). CNAD has reported assets under supervi- sion exceeding USD800 billion, reflecting significant institutional engagement with the regulated digital asset ecosystem. Issues Likely to Impact Use Over the Next 12 Months • Expansion of CNAD technical regulations: second- ary regulations continue to develop, including spe- cific normatives for stablecoins, custody providers and cross-border service providers. • IMF Programme alignment: El Salvador’s Extended Fund Facility (EFF) arrangement with the IMF, approved in March 2025, includes commitments relating to the voluntary (rather than mandatory) acceptance of Bitcoin. The operationalisation of these commitments may reshape Bitcoin’s role in commerce. • Tokenisation of government instruments: explora- tory work on blockchain-based sovereign or quasi-sovereign instruments remains on the policy agenda, with implications for capital markets law. • DeFi regulation: CNAD has yet to issue compre- hensive guidance on decentralised finance activi- ties, creating legal uncertainty for DeFi operators with a nexus to El Salvador. Interaction with Intellectual Property Law The interaction between blockchain business and existing intellectual property frameworks in El Salva-
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