IMF Commends El Salvador While Urging Bitcoin Rollback

The International Monetary Fund has commended El Salvador for its economic progress while simultaneously criticizing the nation’s ongoing Bitcoin initiative.

In a Friday statement, the IMF announced it approved a $139 million payout to the Central American government, though it simultaneously pushed to “reduce the state’s involvement in Bitcoin-related activities.”

Back in 2021, El Salvador adopted Bitcoin as legal tender, drawing sharp criticism from the IMF and various other prominent financial institutions while concurrently negotiating a development loan with the organization.

While the IMF asserted in September that El Salvador was not actively purchasing Bitcoin, the nation’s Bitcoin Office has consistently maintained that it does buy the digital asset.

“Economic activity has exceeded expectations, supported by sustained improvements in security and investor confidence, as macroeconomic imbalances continue to be addressed,” the IMF noted.

The agency added: “However, certain performance criteria were not met, including on the Bitcoin accumulation front, for which waivers were granted based on strong corrective measures and renewed commitments.”

Furthermore, the IMF stated that government participation in Bitcoin operations is currently being scaled down and that “no further bitcoin accumulation is envisaged beyond the documented donations.”

In 2022, Salvadoran President Nayib Bukele announced that the country would purchase one Bitcoin daily, though the source of the funding—and whether purchases were actually taking place—remained ambiguous.

The IMF clarified in September that El Salvador had refrained from using public funds to acquire Bitcoin for a period, relying instead on private donations.

Late last December, El Salvador and the IMF finalized a $1.4 billion loan pact, though the fund conditioned the deal on the nation scaling back specific elements of its Bitcoin strategy.

To encourage cryptocurrency adoption within the dollarized economy, the Salvadoran government distributed free Bitcoin to citizens and launched a state-backed digital wallet in 2021.

Although President Bukele acknowledged in 2024 that citizens were not utilizing the cryptocurrency for everyday purchases as anticipated, he continually boasted that the administration was still accumulating Bitcoin.