Crypto License in El Salvador

Launch a Regulated Crypto Company in El Salvador

El Salvador has established itself as one of the most progressive jurisdictions for digital asset businesses. Following the adoption of the Digital Assets Law, companies may obtain a Digital Asset Service Provider (DASP) license or operate under the Bitcoin Service Provider (BSP) framework, depending on their specific business model.

A crypto license in El Salvador enables companies to legally operate exchanges, token issuance platforms, custody services, brokerage solutions, and blockchain-based financial infrastructure within a structured regulatory environment supported by tax advantages.

Why El Salvador for Crypto in 2026?

El Salvador offers a defined legal and fiscal framework for digital asset companies:

• Regulatory clarity under the Digital Assets Law
• Dedicated supervisory authority for digital assets
• 0% capital gains tax on Bitcoin
• No VAT on digital asset transactions
• Relatively fast incorporation process
• Flexible corporate structuring
• Innovation-oriented public policy

This makes the jurisdiction particularly attractive for Bitcoin-native businesses, token issuers, Web3 projects, and international crypto startups.

Types of Crypto Licenses in El Salvador

Digital Asset Service Provider (DASP)

The DASP license applies to companies providing services related to digital assets, including:

• Crypto exchanges
• Token issuance platforms
• Digital asset brokerage
• Custody and safekeeping services
• Structured digital asset products

DASP is generally required for businesses operating beyond Bitcoin-only activities.

Bitcoin Service Provider (BSP)

The BSP framework is designed for companies focused exclusively on Bitcoin-related services, such as:

• Bitcoin exchanges
• BTC payment processing
• Bitcoin custody services
• Lightning Network infrastructure

BSP is suitable for business models centered purely around Bitcoin operations.

Company Formation Requirements

Before applying for a crypto license, a local legal entity must be incorporated in El Salvador.

Common corporate structure:

• Sociedad Anónima (S.A.)

Core requirements:

• Minimum of two shareholders
• Appointment of a legal representative
• Registered office in El Salvador
• Corporate bank account (subject to compliance review)

Company incorporation typically takes 2–4 weeks, depending on documentation readiness.

Licensing Requirements

Applicants for a DASP or BSP license must submit comprehensive documentation, including:

• Detailed business plan
• Description of services and operational model
• AML/KYC compliance framework
• Risk management and internal control policies
• Cybersecurity and IT governance documentation
• Identification of directors and beneficial owners
• Source of funds verification

Regulators focus on governance standards, transparency, compliance systems, and operational substance rather than only formal registration.

Capital Requirements

Capital requirements vary depending on the risk profile and nature of the business activity.

• Exchanges and custody providers typically require higher capital allocation.
• Brokerage or advisory models may require lower capitalization.

Estimated capital allocation generally starts from approximately USD 50,000, subject to case-specific assessment.

Costs of a Crypto License in El Salvador

Government and Regulatory Fees

• License application fees vary depending on activity
• Annual supervisory fees apply

Company Incorporation

• Incorporation costs: USD 5,000 – 10,000

Legal and Compliance Structuring

• Full legal documentation and submission support: USD 15,000 – 35,000
• AML/KYC framework preparation: USD 10,000 – 20,000
• Governance and risk structuring: USD 10,000 – 25,000

Estimated First-Year Budget

USD 40,000 – 100,000+, depending on business model, infrastructure, and operational scale.

Licensing Timeline

1. Business model assessment
2. Company incorporation (2–4 weeks)
3. Preparation of compliance documentation (4–8 weeks)
4. Submission to the regulator
5. Regulatory review and clarification stage
6. License approval

The average timeframe ranges between 3 and 5 months, depending on the complexity of the project.

Tax Advantages

El Salvador provides significant tax incentives for digital asset companies:

• 0% capital gains tax on Bitcoin
• No VAT on digital asset transactions
• Potential tax efficiencies for international digital asset operations

This structure is particularly beneficial for trading platforms, Bitcoin-focused entities, and token issuance projects targeting global markets.

Banking and Operational Considerations

Although El Salvador maintains a pro-digital asset position, banking access remains compliance-driven.

Banking approval generally depends on:

• Transparent ownership structure
• Verified source of funds
• Strong AML/KYC and compliance controls
• Clear and sustainable business model

Depending on transaction volume and geographic exposure, companies may also use international banking or EMI solutions.

Ongoing Compliance Obligations

Licensed entities are required to:

• Maintain continuous AML/KYC monitoring
• Submit regulatory reports
• Update internal compliance policies
• Maintain required capital levels
• Undergo audits when required

Failure to comply may result in regulatory penalties, suspension, or revocation of the license.

Who Should Consider El Salvador?

El Salvador is particularly suitable for:

• Bitcoin-focused companies
• Token issuance platforms
• Web3 infrastructure providers
• Digital asset investment structures
• International crypto startups seeking tax efficiency and regulatory clarity

For businesses targeting EU markets, a MiCA-compliant CASP license within the European Union may still be required.

FAQ – Crypto License in El Salvador

Is crypto activity regulated in El Salvador?

Yes. Digital asset services operate under the Digital Assets Law within a defined regulatory framework.

Can foreign shareholders establish a licensed company?

Yes. Foreign ownership is permitted.

Is local presence required?

A registered office and legal representative in El Salvador are required.

How long does licensing take?

Typically between 3 and 5 months, depending on complexity.

What are the main benefits of this jurisdiction?

Tax efficiency, regulatory clarity, and a pro-Bitcoin policy environment.