El Salvador has reinvested in Bitcoin (BTC) by purchasing 11 BTC, worth approximately $1 million. With this purchase, the Central American country increases its Bitcoin reserves and takes the next step in its strategy to strengthen its position in the crypto market. However, this policy remains under heavy criticism from the International Monetary Fund (IMF).
The IMF has repeatedly spoken out against El Salvador’s Bitcoin strategy and has imposed strict conditions on the loan the country previously received. These restrictions pose an obstacle to El Salvador’s ambitions to further integrate Bitcoin into its economy and use it as a major financial instrument.
More Bitcoin in El Salvador’s reserves
With the recent purchase, El Salvador’s total Bitcoin reserve increased from 6,011 to 6,022 BTC. The value of this portfolio is almost $570 million. Although the latest purchase is relatively small compared to the total holdings, it is seen as a positive signal by the crypto community.
The Bitcoin community hopes that El Salvador’s continued adoption will inspire other countries to follow a similar strategy. If that happens, billions of dollars could flow into the market, potentially having a significant impact on the Bitcoin price.
IMF Imposes Restrictions on Bitcoin Strategy
However, the IMF continues to put pressure on El Salvador. The country is in financial difficulties and has applied for a $1.4 billion loan from the IMF. This loan has been granted, but with strict conditions.
The IMF demands, among other things, that El Salvador stops mandating Bitcoin use in the country and that tax payments in BTC be banned. In addition, the IMF wants the Chivo wallet, the national Bitcoin wallet that allows residents to carry out free BTC transactions, to be closed.
El Salvador seeks financing from the World Bank
To reduce the influence of the IMF, El Salvador is looking at alternative sources of financing. The country has applied for a $3.5 billion loan from the World Bank. With these additional resources, El Salvador may look to further expand its Bitcoin strategy, which analysts see as a bullish signal for the crypto market.
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Source: https://newsbit.nl/el-salvador-blijft-inzetten-op-bitcoin-ondanks-weerstand-van-imf/
