IMF Urges El Salvador Again to Narrow the Scope of the Bitcoin Law and Strengthen the Regulatory Framework
- Mary-Kate OlsenOriginal
- 2024-10-04 10:04:14626browse
The International Monetary Fund (IMF) recommended on Tuesday that El Salvador narrow the scope of the bitcoin law and strengthen the regulatory framework
El Salvador should narrow the scope of its bitcoin law and bolster the regulatory framework and oversight of the bitcoin ecosystem, the International Monetary Fund (IMF) said on Tuesday.
IMF spokesperson Julie Kozack also said during a press conference that the IMF recommended El Salvador limit public sector exposure to bitcoin, according to a report by Reuters.
This isn't the first time the IMF has cautioned El Salvador. Most recently, the IMF said something similar in August, stating in a press release that “while many of the risks have not yet materialized, there is joint recognition that further efforts are needed to enhance transparency and mitigate potential fiscal and financial stability risks from the Bitcoin project.” At the time, the IMF also said that “additional discussions in this and other key areas remain necessary.”
In fact, El Salvador and the IMF have been going back and forth over bitcoin for years. In November 2021, the IMF said that bitcoin shouldn't be used as legal tender in El Salvador and urged the Central American nation to strengthen the regulation and supervision of that ecosystem, which it again called for in January 2022.
El Salvador made bitcoin legal tender in September 2021, becoming the first country in the world to do so. It currently holds 5892 BTC, which is worth around $345 million at today's prices.
El Salvador's President Nayib Bukele recently said that his plan to make the country a hub for the largest and oldest cryptocurrency has been “net positive” overall, but that adoption has fallen short of his expectations.
In its presentation on Thursday, the IMF also praised Bukele's 2025 budget proposal, which would make the country debt-free.
El Salvador President Nayib Bukele to Present Debt-Free Budget for 2025
Andrés Engler Andrés Engler is a CoinDesk editor based in Argentina, where he covers the Latin American crypto ecosystem. He holds BTC.
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