IMF Loan Restricts El Salvador's Bitcoin Policies, Targets 3.5% GDP Improvement

El Salvador has secured a 40-month, $1.4 billion Extended Fund Facility (EFF) from the International Monetary Fund (IMF), which imposes restrictions on the country's Bitcoin policies. The IMF deal prohibits voluntary Bitcoin accumulation by the public sector, mandates the liquidation of the Fidebitcoin Trust, and requires disclosure of government-held Bitcoin wallet addresses and holdings.

The agreement includes measures to end public participation in the Chivo wallet by July 2025 and to establish a management framework for government-held Bitcoin. The Bitcoin Law has also been amended, making Bitcoin acceptance voluntary for private entities. The IMF described Bitcoin usage in the country as existing in a 'confined' manner, with negligible tax payments and limited public trust due to high price volatility.

Despite these restrictions, El Salvador recently purchased an additional 5 Bitcoin, bringing its total holdings to 6,100 BTC, valued at approximately $600 million. The EFF arrangement aims for a 3.5% GDP primary balance improvement over three years.

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