On Thursday, El Salvador declared its intent to continue acquiring Bitcoin, potentially at an accelerated pace, following a day after securing a financing agreement with the International Monetary Fund (IMF), which recommended limiting cryptocurrency exposure.
Stacy Herbert, director of El Salvador's national Bitcoin office, confirmed on X that Bitcoin will remain legal tender, and the government intends to bolster its strategic Bitcoin reserves.
On Wednesday, El Salvador finalized a $1.4 billion loan agreement with the IMF, under which President Nayib Bukele's administration committed to reducing its bitcoin-related policies. The agreement stipulated that tax payments would be made exclusively in the U.S. dollar, the other official currency.
IMF spokesperson Julie Kozack indicated on Thursday that forthcoming legal reforms in El Salvador would render the acceptance of bitcoin by the private sector optional.
Eugene Epstein, head of trading and structured products for North America at Moneycorp in New Jersey, suggested that the government's decision to increase bitcoin purchases could be a strategy to mitigate any negative perceptions regarding the cryptocurrency's status in El Salvador.
"Considering the scale and likely conditions of the IMF agreement, it was probably beneficial for Bukele to pursue this approach."
El Salvador currently holds 5,968 bitcoins, valued at approximately $594 million. The cryptocurrency has seen a recent uptick following U.S. President-elect Donald Trump's reaffirmation of plans for a strategic reserve for bitcoin, akin to a strategic oil reserve.
In September 2021, El Salvador became the first country to adopt Bitcoin as legal tender alongside the US dollar, a decision that generated friction with the International Monetary Fund (IMF), which had expressed concerns regarding potential financial and legal risks. The IMF has since acknowledged that these risks have not materialized.
President Bukele has actively promoted El Salvador as a hub for digital currency trading, recently hosting an "Adopting Bitcoin" conference.
Furthermore, El Salvador is recognized for "Bitcoin Beach," a prominent tourist destination known for its surfing, where local businesses have integrated Bitcoin as a payment option.