Isabella García
The International Monetary Fund (IMF) has signaled its intent to prevent any changes to the current amount of bitcoin held by the government of El Salvador, creating a clear contrast with President Nayib Bukele’s aggressive pro-Bitcoin stance.
This update follows the IMF’s announcement that it has reached a staff-level agreement with El Salvador on the first review of its Extended Fund Facility (EFF) program. This program was initially established in December, when El Salvador agreed to limit its involvement in bitcoin-related activities in return for a 40-month financing deal totaling $1.4 billion.
IMF Funding Deal Tied to Reduced Bitcoin Activity
The total financial package, which may expand to $3.5 billion with support from other institutions like the World Bank, comes with strings attached. As part of the agreement, El Salvador’s Congress passed legal amendments to align its Bitcoin Law with IMF recommendations, notably making Bitcoin payments optional for private businesses.
In February, the IMF’s Executive Board officially approved the financing framework, unlocking an initial $120 million disbursement upon board confirmation. However, the IMF made clear that the country’s involvement in bitcoin markets poses financial stability risks, even if these risks haven’t fully materialized yet.
“Government activities involving bitcoin will be strictly limited,” the IMF emphasized in its previous statement.
Bukele Continues Bitcoin Accumulation, Defying IMF Warnings
Despite international pressure, President Bukele remains steadfast in his commitment to expanding El Salvador’s bitcoin treasury. In a March post on X (formerly Twitter), he reaffirmed that the country’s strategy remains unchanged:
“No, it’s not stopping,” Bukele wrote. “If it didn’t stop when we were isolated globally and many ‘bitcoiners’ gave up on us, it definitely won’t stop now.”
Just last week, Bukele shared that El Salvador’s bitcoin investment is up by over $357 million in unrealized gains, suggesting strong conviction in the long-term potential of crypto assets.
Uncertainty Looms as IMF Restricts While Bukele Buys More
While the IMF reiterated its desire to freeze further bitcoin acquisitions, Bukele reshared the IMF announcement without commenting on the bitcoin limitations, leaving room for speculation about whether the government will comply or continue to expand its crypto reserves.
Only hours after the IMF statement, El Salvador’s Bitcoin Office announced the purchase of an additional 8 BTC, pushing the country’s total holdings to 6,190.18 BTC.
