BCGAME - Free 5BTC Daily Bonus!El Salvador, the first country in the world to adopt the Bitcoin as legal currency, it reached an agreement with the International Monetary Fund (IMF) for a US$1,4 billion loan aimed at the country's economic reforms. And to secure this money, the country had to make some concessions. One of them was precisely in relation to Bitcoin.
In its official statement, the IMF highlighted: “The Salvadoran authorities and a team of IMF staff have reached a staff-level agreement on a 40-month extended arrangement under the Extended Fund Facility (EFF) for approximately US$1,4 billion (equivalent to SDR 1.033,9 million, or 360 percent of the quota) to address the balance of payments needs and support the government’s economic reforms. The agreement is subject to approval by the IMF Executive Board and is contingent on the implementation of the previously agreed actions.”
In the agreement, El Salvador agreed to adjust its Bitcoin policies. What does this mean in practice? Bitcoin will not cease to be legal tender in El Salvador, but its use will be much more restricted. Private companies will no longer be required to accept the cryptocurrency as a form of payment, and the government will also reduce its involvement in Bitcoin-related activities. In addition, all tax payments will now be made in US dollars.
“Potential risks of the Bitcoin project will be significantly reduced in line with the Fund’s policies. Legal reforms will make acceptance of Bitcoin by the private sector voluntary. For the public sector, engagement in Bitcoin-related economic activities and Bitcoin transactions and purchases will be limited. Taxes will be paid only in US dollars and government participation in the cryptocurrency e-wallet (Chivo) will be gradually phased out. Transparency, regulation and oversight of digital assets will be enhanced to safeguard financial stability, consumer and investor protection, and financial integrity.” stated or IMF.
It is worth remembering that, recently, with Bitcoin reaching the impressive value of US$ 104 thousand, the president of El Salvador, Nayib Bukele, celebrated success after years of facing criticism from financial analysts. Under his leadership, the nation has seen a 118% increase in its Bitcoin holdings this year, highlighting a successful bet on the cryptocurrency.
Since November 2022, the Salvadoran government’s policy has been to buy one Bitcoin every day. The country has already accumulated almost 6.000 Bitcoins, an amount that, at current prices, is valued at more than US$611 million. This representative amount is equivalent to almost 2% of the country’s Gross Domestic Product (GDP), highlighting the importance of Bitcoin in El Salvador’s economic vision.
