El Salvador Takes Another Step Back on Bitcoin – Country’s BTC Officer Issues Statement

El Salvador's official Bitcoin wallet Chivo will be sold or retired, an official said today.

This announcement comes just a day after the country signed a $1.4 billion loan agreement with the International Monetary Fund (IMF), forcing the government to scale back its BTC policies.

Country’s National Office Director Claims Bitcoin Purchases Will Accelerate

Stacy Herbert, Director of the National Bitcoin Office, stated that Bitcoin will remain the official currency in El Salvador and that the government will continue to purchase BTC for its strategic reserves. She hinted that BTC purchases will accelerate despite the wallet changes.

The landmark agreement with the IMF, which still requires approval from the Fund’s executive board, is intended to support El Salvador’s economy but requires significant changes to the country’s BTC strategy.

“The potential risks of the Bitcoin project will be significantly reduced in line with the Fund’s policies,” the IMF said in its announcement. It added that legal reforms will make Bitcoin’s adoption by the private sector voluntary while limiting the public sector’s involvement in BTC-related transactions.

In 2021, El Salvador became the first country in the world to adopt Bitcoin as its official currency, a move backed by President Nayib Bukele. But the IMF has long opposed Bukele’s pro-crypto stance and warned that such policies could make financial aid more difficult.

Despite the criticism, Bukele celebrated Bitcoin’s recent rally, particularly following Donald Trump’s election victory in early November. The price of Bitcoin surpassed $100,000 earlier this month, more than doubling the value of El Salvador’s crypto assets.

*This is not investment advice.