Invest1 publisher3 min readPublished
Coinbase's stablecoin rails carry a $2 remittance app into El Salvador's $9 billion market
Coinbase is supplying the payments stack for Sivar, a Modveon app that sends US money to El Salvador for a flat $2 and settles in stablecoins on Base. Recipients can still collect cash at the other end, so for now the stablecoin sits mainly in the settlement layer.
The Investor · Invest desk
What happened
- More than 25,000 Salvadorans signed up for Sivar before it launched, according to Coinbase and Modveon.
- Under a 40-month IMF loan program, El Salvador amended its Bitcoin Law in January 2025 to make merchant acceptance voluntary and bar tax payments in Bitcoin.
- An IMF staff-level review in early September recorded that majority ownership and operational control of the state Chivo wallet had passed to a private operator.
Compiled by The InvestorSomething wrong?How this is made
Why it matters
- cost Money-transfer firms that take a percentage of each transfer lose the most ground on larger remittances, where a price that stays at $2 undercuts them hardest.
- exposure Coinbase has put its stated 2026 payments priority in front of a national corridor with public numbers, so thin Sivar volume would count as evidence against that strategy.
- precedent With Chivo already in private hands, El Salvador's next digital-money products are likelier to be privately built and state-promoted, as Sivar is.
A fixed price favours whoever sends more. At $2 a transfer whatever the amount [2], a $200 remittance costs 1% and a $500 one costs 0.4% [2]. Coinbase says that puts Sivar among the lowest-cost options in the US-El Salvador corridor [17], though it did not publish the rival prices behind the comparison. Faryar Shirzad, Coinbase's chief policy officer, said the flat fee is possible because the money "moves entirely in digital dollars" [6].
The division of labour says more about Coinbase than the price does. Coinbase supplies the debit-card onramp, a non-custodial wallet for each user, the transfer APIs and settlement on Base [4]. Modveon owns the app and its identity layer. Nana Murugesan, its CEO and co-founder, called Sivar the first national rollout of Modveon's "Verified Operating System" [7]. So Coinbase is competing with the money-transfer companies, or rather, selling rails to a Palo Alto firm that is [1]. It does not own the customer, and with non-custodial wallets it does not hold the balances either [4]. Sivar came a day after Coinbase widened its Citi partnership to offer businesses fiat-and-stablecoin rails [15]. Both deals fit the stablecoin and payments priority Coinbase set for 2026 in its Q4 2025 shareholder letter [16].
The move away from Bitcoin is documented, and it came before this app. The Bitcoin Law amendment and the Chivo handover were steps taken under the IMF program [11][12], and the public-sector stock near 7,764 BTC has not grown through new purchases, according to Cryptopolitan [13]. Cryptopolitan also reports that remittances were what President Nayib Bukele had in mind when Bitcoin became legal tender in 2021 [9]. Sivar puts a dollar stablecoin into that same channel, with the state promoting a private product. Adriana Mira, El Salvador's vice minister of foreign affairs, said Sivar was "a step toward a more personal digital experience designed to meet the needs of Salvadorans, wherever they may be" [14].
Three outcomes fit what is known. Sivar could take a visible share of the roughly $8.3 billion that US-based Salvadorans sent home in 2025 [1] and push percentage-priced rivals to reprice. It could stall at signups, as Bitcoin payments did; a restaurant worker in El Zonte called the local Bitcoin payment scene "dead" in August, Cryptopolitan reported [10]. Or it could grow while recipients take the money straight to one of the more than 1,000 cash-out locations [5]. I think the third is the likeliest. In that case the stablecoin gives Coinbase a cheaper settlement leg and changes little about how Salvadorans spend. A national move to stablecoins for everyday payments would then rest on a remittance app that ends at a cash counter. The evidence that would overturn this view is recipients leaving balances in their Sivar wallets and paying merchants from them.
What to watch
- Any transfer-volume figure from Coinbase or Modveon, set against the roughly $8.3 billion US-based Salvadorans sent home in 2025.
- Fee cuts on larger transfers by percentage-priced money-transfer companies in the US-El Salvador corridor.
- Disclosure of how the $2 fee is split between Modveon and Coinbase, the figure that shows what the exchange earns per transfer.