Stacy Herbert, director of the national bitcoin office, said the cryptocurrency will remain legal tender and the government will continue to buy it, possibly at an accelerated pace, for its strategic reserves.
El Salvador's official digital bitcoin wallet, Chivo, will be sold or discontinued, an official said Thursday, a day after the Central American country reached an agreement with the International Monetary Fund (IMF).
Stacy Herbert, director of the national bitcoin office, said the cryptocurrency will remain legal tender and the government will continue to buy it, possibly at an accelerated pace, for its strategic reserves.
On Wednesday, El Salvador reached a $1.4 billion loan deal with the IMF after agreeing to ease its policies on Bitcoin. In 2021, the country became the first to make the cryptocurrency legal tender.
It should be noted that the IMF has maintained a firm stance against El Salvador's decision to adopt Bitcoin as legal tender, constantly warning about the risks that this measure represents for the country's financial stability. Since the law was approved in September 2021, the international organization has expressed its concerns to the government of Nayib Bukele.
As El Salvador moved towards implementing the Bitcoin law in July 2021, the IMF had already pointed out the potential complications for consumers, especially regarding the choice between Bitcoin and traditional currencies when making payments.
“If goods and services were valued in both a real currency and a crypto asset, households and firms would spend a significant amount of time and resources choosing which money to hold, rather than engaging in productive activities,” the IMF said at the time.
Already in February 2023,
In February 2023, the fund urged El Salvador to address the risks associated with Bitcoin, arguing that its adoption had “not materialized.” At the time, the cryptocurrency was trading around $21,600, according to CoinGecko data.
Bitcoin is trading today, December 19, at US$ 102,827, according to the Lemon platform.
