El Salvador embraces Elon Musk's xAI after failed Bitcoin experiment

In another historic move, El Salvador has partnered with Elon Musk’s xAI to integrate artificial intelligence (AI) into its public education system. 

The initiative will see xAI’s conversational model, Grok, deployed across more than 5,000 schools over the next two years, providing over one million students with adaptive, curriculum-aligned tutoring that evolves to each learner’s pace and mastery level.

Grok is an advanced AI chatbot developed by Musk’s tech company xAI. Closely integrated with X, Grok is designed to provide conversational, real-time responses with access to live platform data. 

Related: How to turn $100 into 10x gains with Grok AI

Elon Musk doubles down on future of education

According to the xAI press release, the project will also support thousands of teachers, positioning AI not as a replacement but as a collaborative partner in the classroom.

The two-year rollout aims to bridge educational divides between urban and rural areas while building a framework for responsible, human-centered AI adoption in schools.

El Salvador President Nayib Bukele said the collaboration marks another chapter in El Salvador’s commitment to innovation:

“El Salvador doesn’t just wait for the future to happen; we build it. From establishing the global standard in security to now pioneering AI-driven education, El Salvador proves that nations can leapfrog directly to the top through bold policy and strategic vision.”

Musk echoed Bukele’s sentiment, emphasizing the transformational nature of the partnership.

“By partnering with President Bukele to bring Grok to every student in El Salvador, we’re putting the most advanced AI directly in the hands of an entire generation. El Salvador isn’t waiting for the future of education — they’re building it with xAI.”

Beyond technology deployment, xAI and the Salvadoran government plan to co-develop new methodologies, datasets, and frameworks to guide ethical and effective AI use in classrooms worldwide.

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From Bitcoin to AI

El Salvador’s latest step into AI technology builds upon its high-profile Bitcoin (BTC) experiment launched in September 2021 — the first national adoption of the leading cryptocurrency as legal tender.

The Bitcoin initiative sought to enhance financial inclusion, attract investment and reduce remittance costs.

Four years later, its results remain mixed. While Bitcoin City and the country’s planned “Volcano Bonds” keep El Salvador in the global spotlight, studies suggest that only a few citizens use the state-backed Chivo wallet regularly. 

In 2024, during an interview with TIME, Bukele acknowledged his disappointment that more of his countrymen haven't gotten behind Bitcoin. 

“Bitcoin hasn't had the widespread adoption we hoped for,” he said. 

In December 2024, El Salvador reached a deal with the International Monetary Fund (IMF) to abandon Bitcoin’s status as legal tender in the country.

The IMF had long warned that Bitcoin’s volatility and limited adoption posed risks to economic stability, urging reforms as a condition for financial assistance. 

To secure a $1.4 billion agreement, the Bukele administration amended the 2021 Bitcoin Law, ending mandatory acceptance, halting tax payments in BTC and scaling back the state’s Chivo wallet program. 

While the U.S. dollar remains the nation’s primary currency, El Salvador continues to hold Bitcoin as a reserve asset, even as its official monetary role has been curtailed.

Related: Elon Musk’s X suspends Grok, crypto community reacts with memes