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El Salvador Bitcoin Accumulation Needs To Stop, IMF Says
The International Monetary Fund (IMF) has published a new report emphasizing that El Salvador must cease all Bitcoin-related activities, including accumulation through purchasing or mining. Additionally, the nation is required to liquidate the fund established for $BTC acquisitions. These measures follow amendments to the Bitcoin Law approved by El Salvador’s congress earlier this year.
While El Salvador has made notable strides in areas such as security and tourism, it continues to face significant challenges like macroeconomic imbalances, high fiscal deficits, and heavy debt burdens. The IMF's agreement offers the country $1.4 billion in financial assistance, potentially unlocking up to $3.5 billion from other organizations, such as the World Bank and the Inter-American Development Bank.
President Nayib Bukele has adjusted his stance on the IMF, moving from dismissive remarks about its opposition to the Bitcoin Law to amending the law and agreeing to halt all public Bitcoin-related activities. The Bukele administration now plans to focus on economic growth and addressing structural challenges under the IMF-supported program.
The IMF’s updated report sets clear deadlines, requiring full compliance by December 2025. By March, El Salvador must identify all public sector-held Bitcoin, specifying wallets, ATMs, and organizations involved, such as Chivo and the Bitcoin Office. The IMF also mandates the liquidation of the Bitcoin trust fund Fidebitcoin and an independent audit of Chivo’s financial statements, to be submitted by mid-2025.
The Bitcoin Bonds—intended for funding Bitcoin mining and the development of Bitcoin City, has also been rejected by the IMF. Furthermore, the IMF prohibits the public sector from issuing or guaranteeing Bitcoin-indexed debt or tokenized instruments.
El Salvador’s narrative surrounding Bitcoin is shifting significantly. The country faces a transformed approach to its digital currency experiment as it aligns with the IMF’s requirements.
The International Monetary Fund (IMF) has published a new report emphasizing that El Salvador must cease all Bitcoin-related activities, including accumulation through purchasing or mining. Additionally, the nation is required to liquidate the fund established for $BTC acquisitions. These measures follow amendments to the Bitcoin Law approved by El Salvador’s congress earlier this year.
While El Salvador has made notable strides in areas such as security and tourism, it continues to face significant challenges like macroeconomic imbalances, high fiscal deficits, and heavy debt burdens. The IMF's agreement offers the country $1.4 billion in financial assistance, potentially unlocking up to $3.5 billion from other organizations, such as the World Bank and the Inter-American Development Bank.
President Nayib Bukele has adjusted his stance on the IMF, moving from dismissive remarks about its opposition to the Bitcoin Law to amending the law and agreeing to halt all public Bitcoin-related activities. The Bukele administration now plans to focus on economic growth and addressing structural challenges under the IMF-supported program.
The IMF’s updated report sets clear deadlines, requiring full compliance by December 2025. By March, El Salvador must identify all public sector-held Bitcoin, specifying wallets, ATMs, and organizations involved, such as Chivo and the Bitcoin Office. The IMF also mandates the liquidation of the Bitcoin trust fund Fidebitcoin and an independent audit of Chivo’s financial statements, to be submitted by mid-2025.
The Bitcoin Bonds—intended for funding Bitcoin mining and the development of Bitcoin City, has also been rejected by the IMF. Furthermore, the IMF prohibits the public sector from issuing or guaranteeing Bitcoin-indexed debt or tokenized instruments.
El Salvador’s narrative surrounding Bitcoin is shifting significantly. The country faces a transformed approach to its digital currency experiment as it aligns with the IMF’s requirements.
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