Bolivia has lifted its ban on cryptocurrency transactions, allowing financial institutions to engage in digital asset operations. This policy shift aims to modernize the country's financial system and address economic challenges, including inflation and currency shortages.
The Central Bank of Bolivia announced that banks can now conduct cryptocurrency transactions through authorized electronic channels. However, cryptocurrencies are not recognized as legal tender, and businesses are not obligated to accept them as payment. The central bank plans to include information about cryptocurrency risks in its Economic and Financial Education Plan to inform the public about safe handling of digital assets.
Since the ban was lifted, there has been a significant increase in cryptocurrency transactions. The Central Bank reported a 100% rise in average monthly virtual asset trading, with approximately $15.6 million traded monthly between July and September 2024. This surge is largely attributed to the trading of stablecoins, digital assets pegged to traditional currencies such as the US dollar. Stablecoins have become increasingly popular in emerging markets like Bolivia due to their reduced volatility compared to other cryptocurrencies.
In response to the growing adoption of digital assets, the Bolivian government has implemented measures to regulate the cryptocurrency market. In May 2025, Supreme Decree No. 5384 was issued, providing a framework for the regulation of virtual assets and fintech companies. This decree defines virtual assets, tokenized assets, blockchain networks, and custody services, ensuring clarity and transparency in the crypto market. It also imposes strict licensing requirements on Virtual Asset Service Providers (VASPs), mandating compliance with anti-money laundering and anti-terrorism financing regulations aligned with international standards.
To ensure the safe and responsible adoption of cryptocurrencies, the Bolivian central bank has launched a comprehensive financial literacy campaign. This initiative includes workshops across the country, teaching participants how to handle private keys and wallets, detect fraud, and understand the risks associated with crypto price fluctuations. The workshops also provide guidance on avoiding scams on applications like WhatsApp, ensuring that citizens can use cryptocurrency without falling victim to fraud.
The surge in crypto transactions is closely linked to a significant policy shift. Until June 2023, the use of virtual asset payments in Bolivia was prohibited. The lifting of this ban in June 2024 opened the door for new crypto services and trading platforms, contributing to the rapid growth in crypto transactions. The Central Bank argues that crypto payments make foreign currency more accessible to the public, benefiting families and small enterprises in making international payments. This accessibility is particularly useful for self-employed workers and small shops looking to expand their businesses.
Cryptocurrency is not only being used by ordinary citizens but also by government-owned companies. The national energy company, YPFB, began using digital assets to pay for imported fuel in March 2025. This initiative was driven by a shortage of US dollars and supply chain issues, demonstrating the government's confidence in the use of cryptocurrency for quick and secure payments. The Central Bank plans to provide more information to the public through quarterly reports, detailing the volume of crypto being traded and ensuring compliance with Bolivia's tax laws, including VAT.
In conclusion, Bolivia's crypto market is experiencing robust growth, with the government taking steps to encourage innovation while safeguarding its citizens. The nation is poised to embrace a digital future, leveraging cryptocurrency for both personal and public sector transactions. The combination of regulatory frameworks, financial literacy programs, and government support positions Bolivia as a leader in the adoption of digital assets.