US Senate Targets El Salvador with Sanctions Over Human Rights and Bitcoin Concerns

The U.S. Senate has introduced a significant piece of legislation aimed at addressing alleged human rights violations and potential misuse of Bitcoin by El Salvador’s government. Titled the El Salvador Accountability Act of 2025, the bill was presented in June by Senators Chris Van Hollen, Tim Kaine, and Alex Padilla. It seeks to impose sanctions on key figures in El Salvador’s executive branch, including President Nayib Bukele, for their alleged involvement in constitutional rights violations against U.S. residents. Additionally, the legislation raises concerns about the use of Bitcoin in corrupt practices, signaling a growing scrutiny of cryptocurrency’s role in international governance.

The bill accuses Bukele’s administration of colluding with U.S. authorities to detain individuals without due process, using American taxpayer funds. It also highlights ongoing human rights issues in El Salvador, including the detention of journalists and advocates under a prolonged “state of exception.” By targeting high-ranking officials, the legislation aims to hold the Salvadoran government accountable for these actions. The inclusion of Bitcoin in the bill underscores the U.S. government’s increasing focus on how cryptocurrencies might be used to evade financial oversight or enable illicit activities.

Bitcoin’s Role Under Investigation

A key component of the El Salvador Accountability Act is its call for a detailed report on the use of Bitcoin by Bukele’s administration. The report, to be prepared by the Secretary of State in consultation with the Treasury, will estimate the funds used by El Salvador to purchase Bitcoin, identify the exchanges and wallet addresses involved, and list individuals with access to these assets. This investigation aims to determine whether Bitcoin has been used to facilitate corruption, graft, or sanctions evasion. The bill also seeks to assess gaps in cryptocurrency oversight that might enable such activities, reflecting broader concerns about the transparency of El Salvador’s Bitcoin adoption.

El Salvador made history in 2021 by becoming the first country to adopt Bitcoin as legal tender, a move championed by Bukele as a way to boost financial inclusion and economic growth. However, critics argue that the lack of regulatory oversight and the volatility of cryptocurrencies could make them a tool for illicit financial activities. The Senate’s legislation suggests that U.S. lawmakers are wary of how Bitcoin’s decentralized nature might complicate efforts to enforce international sanctions. This focus on cryptocurrency marks a new dimension in U.S.-El Salvador relations, as the two nations navigate tensions over governance and human rights.

The sanctions outlined in the bill are comprehensive, targeting not only Bukele and his cabinet but also any foreign individuals involved in human rights abuses or schemes to undermine U.S. constitutional rights. These measures include property freezes, visa bans, and restrictions on financial transactions. The bill also prohibits U.S. funding to El Salvador and instructs U.S. representatives in international financial institutions to oppose loans to the country until it meets specific human rights and governance standards. These conditions reflect a broader U.S. policy of linking financial assistance to democratic reforms.

Senator Van Hollen has been vocal about the need for accountability, stating that Bukele’s government is engaging in a scheme to imprison people in violation of their rights, funded by American taxpayers. His colleagues, Senators Kaine and Padilla, echoed these sentiments, emphasizing the erosion of due process in El Salvador’s “megaprisons” and the need to curb authoritarian practices. Bukele, in response, dismissed the accusations on social media, suggesting the bill stems from political frustrations rather than substantive concerns. This exchange highlights the deepening rift between the U.S. and El Salvador’s leadership.

The legislation has garnered support from organizations like the Latin America Working Group, Human Rights Watch, and the Washington Office on Latin America, which praise its focus on human rights and anti-corruption measures. These groups argue that Bukele’s policies, including the detention of over 85,000 people since 2022, have led to systemic abuses and undermined judicial independence. The bill’s emphasis on transparency in U.S. assistance and bilateral agreements further aligns with these organizations’ calls for greater oversight of international partnerships.

If passed, the El Salvador Accountability Act could significantly alter U.S.-El Salvador relations, particularly in the context of crypto policy. The requirement for a report on Bitcoin’s use in corruption could set a precedent for how the U.S. addresses cryptocurrency in other nations. For El Salvador, the sanctions and financial restrictions could strain an economy already grappling with the challenges of Bitcoin integration.