El Salvador Agrees on Support Loan with IMF... Conditions to Limit Bitcoin Activities

El Salvador, which officially adopted Bitcoin (BTC) as legal tender, has secured a support loan from the International Monetary Fund (IMF).

According to The Block's report on the 19th (local time), the support fund is provided to assist El Salvador's reform agenda and restore the national payment balance. In its statement, the IMF explained that the support fund aims to recognize El Salvador's imminent macroeconomic and structural challenges, strengthen fiscal and external stability, and build a strong inclusive growth framework.

The loan amount is expected to be $1.4 billion, with the total funding package exceeding $3.5 billion.

This fund is conditioned on reducing the potential risks of El Salvador's Bitcoin project. The detailed provisions include the voluntary acceptance of Bitcoin by the private sector. El Salvador had previously stipulated in Article 7 of the Bitcoin Law in 2021 that "all economic agents must accept Bitcoin as a means of payment when offered by those acquiring goods or services."

Additionally, the IMF fund instructed that El Salvador's citizens pay taxes only in US dollars and plans to gradually reduce government intervention in the government-provided Bitcoin wallet, Chivo.