IMF Works with El Salvador on Bitcoin Risk Management

The International Monetary Fund (IMF) is collaborating with El Salvador to address the financial risks linked to its Bitcoin adoption.

The aim is to create a solid plan to stabilize and grow the economy while managing Bitcoin as legal tender.

The IMF’s recent update, following discussions led by Raphael Espinoza, highlighted a focus on improving public finances, enhancing bank reserves, and increasing financial transparency.

The organization emphasized the need for El Salvador to boost its fiscal balance by 3.5% of GDP over three years, optimizing public spending on services and infrastructure.

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Both parties acknowledged potential risks from Bitcoin, including concerns about fiscal stability and transparency. They agreed on the need for further measures to address issues like corruption and money laundering.

El Salvador, which began using Bitcoin as legal tender in September 2021 under President Nayib Bukele, is committed to its Bitcoin strategy despite earlier IMF warnings. The country continues to buy Bitcoin daily through a Dollar Cost Averaging approach and currently holds about 5,835 BTC, valued at roughly $334 million.

Alexander Stefanov

With over 8 years of experience in the cryptocurrency and blockchain industry, Alexander is a seasoned content creator and market analyst dedicated to making digital assets more accessible and understandable. He specializes in breaking down complex crypto trends, analyzing market movements, and producing insightful content aimed at educating both newcomers and seasoned investors. Alexander has built a reputation for delivering timely and accurate analysis, while keeping a close eye on regulatory developments, emerging technologies, and macroeconomic trends that shape the future of digital finance. His work is rooted in a passion for innovation and a firm belief that widespread education is key to accelerating global crypto adoption.