IMF Demands El Salvador Reassess Bitcoin Legislation as $1.4 Billion Credit Limit Talks Stall

IMF Demands El Salvador Reassess Bitcoin Legislation as $1.4 Billion Credit Limit Talks Stall

IMF Demands El Salvador Reassess Bitcoin Legislation as $1.4 Billion Credit Limit Talks Stall

The Salvadoran government’s adoption of Bitcoin has had a negative impact on the country’s negotiations with the International Monetary Fund (IMF). According to reports, the IMF has requested that El Salvador make changes to its Bitcoin law in order to obtain a $1.4 billion credit line.

According to foreign media outlet infobae, despite the Salvadoran government’s hope to secure a $1.4 billion credit line from the IMF to help accelerate debt payments and other obligations, the IMF has made it clear that Bitcoin is a key factor preventing the country from obtaining the credit line, and has demanded that El Salvador make changes in its stance on Bitcoin and cryptocurrency.

However, Salvadoran President Nayib Bukele, who strongly supports Bitcoin, does not appear to be willing to modify the country’s law that designated Bitcoin as legal tender in 2021, leading to a two-year deadlock in negotiations between El Salvador and the IMF. Since being reelected in February, Nayib Bukele has continued to intensify his cryptocurrency fiscal policy, stating that the treasury will continue to purchase one Bitcoin per day until the legal tender becomes unaffordable.

Negotiations between Salvadoran authorities and the IMF will resume on April 15th, with Nayib Bukele’s brother, Ibrajim Bukele, serving as the head of El Salvador’s delegation.