El Salvador has purchased 11 Bitcoin (BTC), valued at $1 million, just a day after securing a $1.4 billion loan agreement with the International Monetary Fund (IMF). The deal included provisions to limit the government’s involvement in Bitcoin-related activities, but the nation has demonstrated its ongoing commitment to its cryptocurrency strategy.
El Salvador Expands Bitcoin Holdings
The National Bitcoin Office shared on December 19 that the country had added 11 BTC to its Strategic Bitcoin Reserve. This purchase deviated from President Nayib Bukele’s previously announced plan to buy “one Bitcoin per day,” which began in November 2022. With this acquisition, El Salvador’s Bitcoin holdings now total 5,980.77 BTC, valued at approximately $580 million, based on Bitcoin’s current price of $97,000.
Stacy Herbert, Director of the National Bitcoin Office, confirmed in a post on X that El Salvador intends to continue purchasing Bitcoin, potentially at a faster rate.
IMF Loan Agreement and Its Conditions
On December 18, El Salvador finalized a $1.4 billion agreement with the IMF, which aims to support the country’s economy over the next 40 months. As part of the deal, the government agreed to scale back its involvement in Bitcoin-related activities. Specifically, the agreement requires the following measures:
- Making Bitcoin acceptance voluntary in the private sector.
- Allowing taxes to be paid only in US dollars.
- Unwinding government participation in the Chivo crypto wallet.
The IMF’s Executive Board still needs to approve the agreement, which would conclude four years of contentious negotiations. The IMF has previously criticized El Salvador’s Bitcoin policies, warning that they could pose financial risks.
Bitcoin Remains a Key Strategy
Despite the IMF’s conditions, the Salvadoran government remains committed to Bitcoin. President Bukele’s administration has stated that it will continue purchasing Bitcoin and will not sell its current holdings. Stacy Herbert reaffirmed that Bitcoin will remain legal tender in the country. She also noted that the government’s Chivo wallet will be sold or phased out, while private-sector wallets will continue to operate.
El Salvador made history in September 2021 by becoming the first country to adopt Bitcoin as legal tender. While the IMF agreement imposes some restrictions, the nation’s leadership insists that Bitcoin will remain central to its economic strategy.
