The story of El Salvador is often limited to headlines about Bitcoin becoming legal tender, but what really matters is what happened next. Miloš Jakovljević, Deputy Head of Money Laundering Reporting at B2BINPAY, describes how the country treated gaps as a wake-up call and built one of the most structured digital asset frameworks in the world, questioning compliance teams: are you mapping this new perimeter or are you still planning for a world that no longer exists?
Today, many cryptocurrency And blockchain observers focus on American coercive measures, SECOND the signals and political cycle that shapes digital asset policy. But what if the most effective crypto regulation is now being developed outside the United States? It’s a question that few people ask and even fewer attempt to answer.
However, the answer already exists and it points to Latin America. The region treated nearly $1.5 trillion in crypto transactions between mid-2022 and mid-2025, and in many countries, stablecoins account for more than half of all exchange activity. This means that digital assets in the region represent a substantial part of citizens’ daily financial lives. And once adoption reaches this scale, regulators are obligated to create transparent and actionable rules.
In fact, they have already started. Brazil sets the tone for banking-level requirements for service providers, while its neighbors develop their own tailor-made frameworks. Among them, the most notable case is that of El Salvador. A country once known for its bold Bitcoin experiment is currently building one of the most disciplined digital asset regimes in the region.
When usage exceeds policy, rules follow money
Latin America’s regulatory progress should not be tied to ideological or political cycles. It is actually a response to daily financial pressure. Traditional banking just doesn’t work for much of the region: more than 70% people are still unbanked or underbanked. Thus, for many households, opening an account, accessing dollars or sending money abroad is slow, expensive, or even severely limited.
When basic tools are not available, people look for alternatives. This is why digital wallets and dollar-linked assets have become commonplace. They offered what local finances often could not: fast transfers, stable value, and low barriers to entry. But despite the advantages, there are reservations. How to protect people and resolve disputes when a transaction cannot be reversed and fraud can it cross borders in seconds?
Regulators responded quickly to this problem. Argentina’s strict currency controls have pushed families and businesses to turn to digital dollars, so supervisors tightened LBC practices. Meanwhile, Colombia’s multi-year pilot project with banks laid the basis of the rules of custody and supervision. And Brazil, the most mature market in the region, is already in a second phase with governance and asset segregation requirements for virtual asset service providers (VASPs).
This is the example of regulation catching up with how people actually move money, not the other way around – a healthier order than in many larger markets. It’s not perfect, but it’s much more consistent with actual user behavior than the rule-making cycles we see in Washington or Brussels.
So, as the region becomes one of the most active places to develop strong rules around digital assets, one jurisdiction, as previously mentioned, stands out more than anything else: El Salvador. What makes it unique?
El Salvador’s regulatory pivot
The story in El Salvador is often limited to headlines about Bitcoin becoming legal tender. This experiment attracted worldwide attention because it was bold and truly novel, but it never became the powerhouse many hoped it would. Retail utilization remained low, operational risks multiplied, and the country ultimately faced pressure from international lenders to put everything back in place. Yet what really matters is what happened next.
Instead of defending this initial hype, El Salvador treated these shortcomings as a wake-up call. It has evolved from a symbolic experiment into a serious project, building a regulatory and supervisory system capable of truly supporting digital asset activity at scale. This is how the Law relating to the issuance of digital assets (LEAD) and the National Commission for Digital Assets (CNAD) were created.
Together, they form a regulatory package that many advanced markets are still struggling to adopt. Licensing is mandatory, beneficial ownership must be disclosed and AML checks, cybersecurity Governance standards and rules are strict requirements. The CNAD can suspend operators, freeze assets and sanction unlicensed activities – and in fact, it do.
I think that’s what true supervision looks like. The institutional layer is equally important. Banks can apply to offer digital asset services, but only within strict capital and adequacy thresholds. The diet itself supports more complex instruments, such as gold-backed stablecoins, that few emerging markets can handle.
Overall, you might disagree with this first experience with Bitcoin. But what he has become deserves real attention. The country now operates one of the most structured digital asset frameworks in the world and, arguably, the most ambitious in its region. This is exactly the kind of environment that global suppliers need to take seriously.
What this means for compliance teams
The most interesting regulatory work no longer takes place in the jurisdictions that speak the loudest. Real progress comes from places that had to regulate because people were already using crypto to solve everyday problems. Latin America, and El Salvador in particular, are proof of this.
If you are sitting in a compliance or risk today, it should be recognized that licensing, onboarding and anti-money laundering are increasingly shaped by regimes that are much closer to LEAD and CNAD. So, are you mapping this new scope or are you still planning for a world that no longer exists? The debate is open.
