Is Bolivia Entering a New Phase of Cryptocurrency Adoption?

By PPO Indacochea

Bolivia is experiencing a marked increase in cryptocurrency use following the government’s decision to lift a decade-long prohibition, raising questions about whether the country is moving toward a structural integration of digital assets into its financial system.

The ban, originally imposed in 2014 by the Central Bank of Bolivia, prohibited the use of Bitcoin and other virtual currencies on the grounds of consumer protection and financial stability. For years, Bolivia stood out in Latin America as one of the most restrictive jurisdictions, even as neighboring countries such as Brazil, Argentina, and Colombia developed regulatory approaches or tolerated informal use. The reversal came in June 2024, when authorities authorized banks and licensed platforms to carry out transactions in digital assets under supervision.

Since then, activity has expanded rapidly. Reuters reported that crypto transactions reached USD 294 million in the first half of 2025, compared with USD 46.5 million in the same period of 2024, a surge of more than 530 percent. Over the first twelve months after legalization, volumes exceeded USD 430 million. The majority of these transactions are linked to retail users, with small businesses and households adopting stablecoins such as Tether (USDT) and Bitcoin for payments, remittances, and protection against inflation.

Economic conditions appear central to this trend. Bolivia has faced shortages of U.S. dollars, inflationary pressures, and difficulties in securing energy imports. In this context, cryptocurrencies are increasingly used as a substitute mechanism. 

In May 2025, the government enacted Supreme Decree No. 5384, establishing a legal framework for the sector. The measure introduced licensing obligations for virtual asset service providers, anti-money laundering and counter-terrorist financing requirements, and custody rules for financial institutions.