El Salvador and the IMF: continued pressure on the country's Bitcoin regulation

Once again, the International Monetary Fund (IMF) has intervened to put pressure on El Salvador regarding regulation on Bitcoin.

The International Monetary Fund (IMF) has once again addressed El Salvador and Bitcoin, suggesting that the country strengthen its regulation.

During a press conference, Julie Kozack, who serves as the director of the IMF's communication department, stated:

“We have recommended narrowing the scope of the bitcoin law, strengthening the regulatory framework and supervision of the bitcoin ecosystem, and limiting the public sector’s exposure to bitcoin”

This pressure is being applied despite El Salvador, which legalized BTC in 2021, having an annual GDP growth rate of 3%.

The IMF is essentially renewing its درخواست for El Salvador to bolster regulation on Bitcoin, which was initially提出 in a more subtle manner last August.

A report by the IMF at that time highlighted the progress in discussions with the government of El Salvador.

Specifically, the IMF commended the advancement in talks for a program that aims to bolster public finances, shore up bank reserves, and enhance governance and transparency.

Moreover, regarding Bitcoin, the IMF only acknowledged the need for El Salvador to endeavor to enhance transparency and mitigate risks to fiscal and financial stability.

Such statements have not signaled a complete embrace of the flagship crypto by the IMF, but they do indicate a more relaxed and measured approach by the institution in its discourse compared to the past.

While the IMF is softening its stance on BTC, El Salvador's President Nayib Bukele has expressed a mild disappointment in its adoption.

In August 2024, Bukele told TIME that the adoption of Bitcoin in El Salvador is not as widespread as he had hoped.

The President wished that more of his citizens had joined his BTC strategy, highlighting how much they would have gained with BTC from 2021 to the present day.

However, Bukele is also pleased that he did not coerce anyone to follow him and that Salvadorans were given the freedom to choose whether or not to adopt Bitcoin in the country.

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