According to Deep Tide TechFlow, on December 19, Cointelegraph reported that El Salvador reached a $1.4 billion loan agreement with the International Monetary Fund (IMF), planning to receive funding support over the next 40 months. As part of the agreement, the country will make it voluntary for merchants to accept Bitcoin payments, relieve its participation in the rarely used Chivo wallet, and restrict public sector involvement in Bitcoin-related economic activities.
The IMF stated that this move will significantly reduce the potential risks associated with Bitcoin projects, while clearly stipulating that public sector participation is limited to specific Bitcoin economic activities. Additionally, taxes will be paid only in U.S. dollars, not in Bitcoin. The agreement still requires approval from the IMF's executive board, marking the end of a four-year negotiation with the IMF since El Salvador adopted Bitcoin as legal tender in June 2021. The IMF has previously warned that the speculative nature of Bitcoin could pose financial risks to the country. The agreement will also facilitate additional financing from institutions such as the World Bank, totaling over $3.5 billion.
Nonetheless, El Salvador's Bitcoin advisor Max Keiser expressed disdain for this on social media X, stating that the use of Bitcoin in the country has 'never been more active and continues to grow.' However, surveys show that 92% of Salvadorans have not used Bitcoin for transactions, an increase from 88% in 2023.
