Progress Made, Compliance Deadline Set

El Salvador’s Bitcoin initiatives have reached a crucial juncture as the International Monetary Fund (IMF) has revealed progress in their negotiation talks. Currently, El Salvador and the IMF are working together to address concerns surrounding the country’s Bitcoin project and the sale of its government-backed e-wallet, Chivo.

With the talks centred around enhancing transparency and eliminating potential risks, the country aims to secure a $1.14 billion loan under the 40-month Extended Fund Facility (EFF) program.

IMF and El Salvador Near Landmark Bitcoin Agreement

In an official statement earlier today, the IMF has provided an update on the ongoing discussions with El Salvador regarding the country’s Bitcoin project. The financial institution claims that the negotiations for the Chivo sale are “well advanced,” adding,

Analyzing the IMF’s Extended Fund Facility for El Salvador

The IMF report also sheds light on the EFF program, via which the country intends to secure a $1.4 billion loan. The agency has been working closely with President Nayib Bukele in facilitating the EFF program, which was approved for $1.4 billion. Earlier this year, El Salvador agreed with the IMF to pause its Bitcoin accumulation strategy as per the EFF program. The country is also willing to sell its Chivo wallet infrastructure, allowing the private sector to use BTC as a legal tender freely.

Despite this deal, El Salvador reportedly continues to accumulate Bitcoin through its daily BTC accumulation plan. According to Arkham Intelligence data, the government now holds about 7,508 BTC. Last month, as CoinGape reported, El Salvador made its largest BTC purchase, accumulating more than $100 million in the coin. 

Notably, the agency has been holding regular discussions with the government regarding the EFF program. As part of the second review of the 40-month EFF arrangement, the organization was focusing on the country’s economic program.

In the latest report, the IMF praised El Salvador’s economic growth. Projecting the potential growth of real GDP, the report noted,

The team also expressed enthusiasm for the country’s commitment to fiscal consolidation. The report stated, “The authorities’ commitment to fiscal consolidation remains strong—the end-2025 primary balance target is well on track to be met, and the recently approved 2026 Budget is consistent with a further reduction in the deficit along with an expansion in social spending.”