El Salvador Abolishes 'Mandatory Bitcoin Payment' Regulation

El Salvador has passed a bill to abolish the mandatory use of Bitcoin (BTC) for payments. This move is seen as a measure to comply with the conditions of the International Monetary Fund (IMF)'s financial support program.

According to El País on the 31st (local time), the Salvadoran parliament approved a legal amendment that leaves the adoption and use of Bitcoin to the discretion of users. This follows the IMF's demand for a revision of Bitcoin policies as a condition for approving a $1.4 billion loan.

Under the amended law, businesses and institutions in El Salvador are no longer obligated to accept Bitcoin as a means of payment. Additionally, Salvadoran citizens are not forced to pay taxes using Bitcoin.

El Salvador was the first country in the world to adopt Bitcoin as legal tender in 2021. However, international financial organizations like the IMF have continuously demanded policy revisions, citing Bitcoin's high volatility and financial stability issues.