IMF Approves Disbursement Despite Bitcoin Rule Violations
The International Monetary Fund (IMF) Executive Board completed the second and third reviews of El Salvador's performance under a $1.4 billion extended fund facility originally greenlit in February 2025. Following the review, the institution approved a disbursement of approximately $138 million, citing strong economic performance, ongoing security improvements, and efforts to reduce imbalances.
While praising the government's compliance with several credit facility conditions, the IMF highlighted that certain performance criteria regarding bitcoin accumulation were not met. El Salvador's bitcoin reserve grew to 7,792 BTC through private donations.
Corrective Measures and Private Sector Shifts
Despite the violations of rules restricting engagement in bitcoin-related economic activities and purchases, the IMF issued a waiver based on strong corrective measures and renewed commitments. Specifically, the institution applauded the recent transfer of the majority control of the Chivo wallet to a private operator, which helps reduce direct state crypto ties.
According to the IMF, funding for the bitcoin added to the country's reserves originated from an undisclosed private donor rather than public holdings. Some sources have pointed to stablecoin issuer Tether, which relocated its headquarters to El Salvador, though no official clarification regarding the donor's identity has been issued.
Looking Ahead
Dan Katz, IMF First Deputy Managing Director, described the unwinding of state involvement in bitcoin-related activities and the Chivo Wallet ownership transfer as a welcome step, noting that related regulations are being enhanced. The IMF stated that no further bitcoin accumulation is expected beyond the documented donations.
It remains to be seen whether President Bukele will continue to grow El Salvador's bitcoin stash through donations or align strictly with the IMF's requirements moving forward.
