The government of El Salvador might be obligated to modify its Bitcoin laws within the country in a new deal with the International Monetary Fund (IMF).
This means the country would have to drop its legal requirement for businesses to accept BTC as payment and instead make it a voluntary payment method.
Why? Because El Salvador has a $1.3 billion debt with the IMF.
Related: El Salvador’s 1-Bitcoin-a-Day Strategy Hits 5,948 BTC Milestone
El Salvador Would Roll Back on Its Bitcoin Plans
El Salvador adopted Bitcoin as legal tender in September 2021, actively acquired Bitcoin since then, and started with just 200 BTC that year. It didn’t stop there. The government continued its strategy, committing to daily Bitcoin purchases.
By November 2024, the country had accumulated 5,942 BTC. However, the IMF has always expressed concerns about the potential financial risks, warning president Nayib Bukele and government officials of challenges for consumers navigating between Bitcoin and fiat currency in everyday transactions, as it would bring inefficiencies and resource costs.
In February 2023, the IMF urged the country to address risks associated with Bitcoin, arguing that its benefits had not materialized (Bitcoin was trading at approximately $21,600 then).
Related: Risk Pays Off: El Salvador Sees $263M Bitcoin Profit, Russell Okung’s BTC Worth $20M
Discussions around the $1.3 billion loan and potential revisions to the Bitcoin Law have been underway since at least October 2024. This could mean the country might have to scale back on its BTC purchases and strategic plans for the foreseeable future.
