El Salvador Bitcoin Holdings Reach 6,101 BTC Despite IMF Restrictions
by Maisie Morrison · BlockonomiTLDR
- The IMF has demanded El Salvador stop Bitcoin accumulation through both purchasing and mining as part of a $1.4 billion loan agreement
- El Salvador must liquidate its Bitcoin trust fund and disclose all government Bitcoin holdings by specific deadlines in 2025
- President Nayib Bukele publicly refuted the IMF terms, tweeting “No, it’s not stopping” regarding the country’s Bitcoin strategy
- The IMF agreement prohibits El Salvador from issuing any debt or tokenized instruments related to Bitcoin
- Despite the IMF’s demands, El Salvador added 1 BTC to its national reserves, bringing total holdings to 6,101 BTC ($510 million)
El Salvador’s Bitcoin strategy has hit a roadblock with the International Monetary Fund (IMF). The global financial institution published a new Staff Country Report that demands the end of Bitcoin accumulation in the Central American nation. This has created tension between President Nayib Bukele and the international body.
The IMF report states that El Salvador must stop buying and mining Bitcoin. This is part of the conditions for a $1.4 billion loan agreement. The loan could potentially unlock up to $3.5 billion from other organizations like the World Bank.
El Salvador faces several economic challenges despite improvements in security and tourism. The country struggles with macroeconomic imbalances. It also deals with high fiscal deficits and substantial debt.
Bukele has changed his approach to the IMF over time. He once mocked the fund’s position on the Bitcoin Law. Now his administration has made adjustments to comply with some requirements.
The IMF report specifies that El Salvador must fully comply with the changes by December 2025. The main concern is about the legal tender status of Bitcoin. The fund emphasizes that the public sector must stop its “voluntary accumulation of BTC.”
This prohibition includes both purchasing and mining activities. By the end of March, the country must identify all Bitcoin accumulated by the administration. This includes listing wallets and ATMs of public companies involved with Bitcoin.
The country is also required to liquidate the Bitcoin trust fund called Fidebitcoin. This fund was previously used to acquire BTC. El Salvador must present financial statements from Chivo, audited by an independent crypto-experienced auditor.
One major project affected is the Bitcoin Bonds. These bonds were meant to finance Bitcoin mining infrastructure and develop Bitcoin City. The IMF has rejected these bonds completely.
Bukele Stands Firm
The IMF explicitly prohibits the public sector from issuing any type of debt or tokenized instrument related to Bitcoin. This is part of the quantitative performance criteria for the loan agreement.
Despite these demands, President Bukele has publicly refuted the terms. “This all stops in April. This all stops in June. This all stops in December. No, it’s not stopping,” Bukele wrote on social media platform X.
Bukele’s defiance was backed by action. The country’s Bitcoin Office announced the addition of 1 BTC to its national reserves on Tuesday. This brings El Salvador’s total holdings to 6,101 BTC, worth approximately $510 million.
The president has found support from Bitcoin stakeholders. Michael Saylor, chairman of Strategy, posted “Bitcoin adoption is unstoppable” in response to Bukele’s message.
El Salvador’s relationship with the IMF has been strained since 2021. That year, the country made Bitcoin legal tender. In 2022, the IMF urged El Salvador to discontinue this status.
The country faces financial consequences if it fails to comply. Credit rating agencies Fitch and Moody’s downgraded El Salvador in 2022. This reflects concerns about the country’s financial stability.
Compliance reviews are scheduled for June and September 2025. El Salvador risks losing its loan package if it fails to follow the new rules. However, Bukele remains firm in his stance.
“If it didn’t stop when the world ostracized us and most ‘Bitcoiners’ abandoned us, it won’t stop now, and it won’t stop in the future,” Bukele stated. He ended with the phrase “Proof of work > proof of whining.”
The situation highlights the tension between traditional financial institutions and cryptocurrency adoption. El Salvador was the first country to adopt Bitcoin as legal tender. Now it faces pressure to limit its involvement with the digital currency.
The coming months will be crucial for El Salvador’s Bitcoin strategy. The country must balance its commitment to cryptocurrency with the need for international financial support. The outcome will have lasting implications for both El Salvador and the future of national Bitcoin adoption.