The agreement, if finalized, would force El Salvador to remove a mandatory payment requirement for BTC.
The IMF has long voiced its disapproval of El Salvador’s plan to use Bitcoin as legal currency.
Under pressure from the International Monetary Fund (IMF), El Salvador, the world’s first government to adopt Bitcoin as legal cash, is allegedly reducing its BTC aspirations. According to the Financial Times, which cited sources familiar with the situation, El Salvador is reportedly planning to amend its Bitcoin policy in exchange for a $1.3 billion loan from the International Monetary Fund (IMF), as reported on December 9th.
The agreement, if finalized, would force El Salvador’s government to remove a mandatory payment requirement for Bitcoin, turning it into an optional payment option for companies.
Long Awaited Loan
With the deal’s finalization anticipated within the next two or three weeks, the World Bank and the Inter-American Development Bank are both likely to lend an additional $1 billion over the following few years.
The International Monetary Fund has long voiced its disapproval of El Salvador’s plan to use Bitcoin as legal currency, and President Nayib Bukele and his administration have received repeated warnings from the IMF about the dangers to the country’s financial stability presented by this choice.
Since at least October, the Salvadoran government and the International Monetary Fund have been in discussions on the $1.3 billion loan and potential amendments to El Salvador’s Bitcoin Law. President Nayib Bukele of El Salvador used social media to boast about the country’s untapped gains from Bitcoin investments when the price of the cryptocurrency surpassed $100,000 for the first time on December 5th.
The country has reportedly put almost $270 million into Bitcoin since its first introduction, according to Bukele’s latest report. There has been no sale of Bitcoin and the portfolio shows that the unrealized earnings are more than $333 million.
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