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El Salvador Updates Bitcoin Regulations Amid IMF Deal
El Salvador has made significant changes to its Bitcoin regulations as part of a deal with the International Monetary Fund (IMF). The country’s Congress has approved the reforms, aligning its Bitcoin policies with the terms of its $1.4 billion loan agreement with the IMF.
Regulatory Changes
The amended legislation no longer mandates businesses to accept Bitcoin as payment, making its use voluntary. Additionally, tax payments are restricted to U.S. dollars, and the government-led crypto initiatives, including the state-backed Chivo wallet, will be scaled back. However, Bitcoin remains a legal tender in the nation.
Bitcoin Accumulation continues to be a priority for El Salvador, with the country currently holding 6,049 BTC, valued at approximately $633 million, and an unrealized profit of 127%. The National Bitcoin Office has been actively accumulating Bitcoin, with recent purchases including 11 BTC valued at over $1 million.
Accelerated Accumulation Strategy
Following the IMF deal, El Salvador accelerated its Bitcoin accumulation strategy, deviating from its “1 Bitcoin a day” program. The country plans to accumulate Bitcoin at an “accelerated pace,” with recent purchases including 12 BTC on January 21.
Crypto-Friendly Initiatives
El Salvador has launched several crypto-focused initiatives to integrate Bitcoin into its economy, including:
- Installing over 200 Bitcoin ATMs, making the country one of the most Bitcoin-friendly regions for transactions.
- Volcano Energy, a Bitcoin mining project that uses renewable energy from volcanic sources to mine Bitcoin.
- Volcano Bonds, a Bitcoin-backed bond initiative designed to raise funds for infrastructure projects and the development of Bitcoin City—a proposed tax-free crypto hub powered by geothermal energy.
Crypto Industry Involvement
Tether Group, a crypto industry giant, has announced plans to relocate its entire operations to El Salvador after securing a Digital Asset Service Provider license in the country.
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