One Bitcoin is still being purchased by the government every day, according to Stacy Herbert, director of the National Bitcoin Office. El Salvador will maintain its Bitcoin purchase policy but at a slower pace, the country said Thursday. The World Monetary Fund had already asked the government to lower its crypto exposure as part of a funding agreement it finalized the day before, so this move came as no surprise.
Buying Bitcoin Despite IMF Deal
As part of the loan arrangement, the government has committed to lowering Bitcoin-related risks and maintaining the voluntary nature of private sector adoption. Finally, it shows that, in line with IMF policies, the government’s Bitcoin risks will drastically decrease.
Meanwhile, El Salvador will continue to purchase Bitcoin for its strategic reserve, according to Thursday’s X announcement by Stacy Herbert, director of the country’s National Bitcoin Office. Further, she said that the office would keep developing Bitcoin Purchases, making roadmaps, recruiting investors, and introducing educational initiatives.
Moreover, Herbert verified that the government continues its continuing policy of purchasing one Bitcoin every day. Prior statements by President Nayib Bukele indicate that this policy will be maintained until Bitcoin “becomes unaffordable with fiat currencies.” At the moment, El Salvador has 5,969 Bitcoins, with a value of $579mm.
Shifts in Bitcoin Strategy and Chivo Wallet
A $1.4 billion loan arrangement with the International Monetary Fund was finalized on Wednesday. As part of the deal, President Bukele’s administration was required to reduce the scope of Bitcoin regulations. One of the two official currencies of the country, the US dollar, is designated as the exclusive means of payment for taxes under the agreement.
This deal signifies a major change in El Salvador’s ambitious Bitcoin strategy. It is currently seeking clearance from the IMF Executive Board. In addition, the government intends to lessen its involvement with the Chivo wallet, which was established as the official Bitcoin digital wallet.
One poll found that 92% of Salvadorans have never used Bitcoin, even though it is legal cash there. As a result, the wallet has not been widely used. Herbert revealed that the Chivo wallet will be sold or discontinued. However, she confirmed the continuation of private Bitcoin wallets in El Salvador.
Summary
Despite shifting priorities in the wake of a $1.4 billion loan arrangement. The International Monetary Fund, El Salvador, will maintain its daily Bitcoin purchase for its strategic reserve. Part of the agreement is the government’s promise to lessen the dangers associated—with Bitcoin and to cut ties with the underutilized Chivo wallet.
The government will reduce its purchases of Bitcoin, although adoption is still voluntary. All tax payments must be made in US dollars per the IMF agreement. There are 5,969 Bitcoins in El Salvador’s possession, with a current worth of $579 million.
FAQs
Why is El Salvador reducing Bitcoin purchases?
The IMF agreement requires El Salvador to lower its crypto exposure and reduce Bitcoin-related risks.
What is the status of the Chivo wallet?
El Salvador plans to sell or discontinue the Chivo wallet due to its low usage, while private Bitcoin wallets will remain.
How much Bitcoin does El Salvador own?
As of now, El Salvador holds 5,969 Bitcoins, valued at $579 million.
What changes were made regarding tax payments?
Under the IMF agreement, taxes in El Salvador must be paid exclusively in US dollars.
