In December 2024, El Salvador pledged to scale back its BTC initiatives as part of its negotiations with the IMF. The IMF had requested that the country stop mandating Bitcoin acceptance for businesses and restrict the public sector’s involvement in crypto-related activities. Despite these promises, the latest BTC purchase signals that El Salvador is still committed to growing its Bitcoin reserves.

Stacy Herbert, head of El Salvador’s National Bitcoin Office, hinted in late 2024 that the country intended to accelerate its Bitcoin accumulation, even as it worked to meet the IMF’s demands. The latest purchase appears to align with her remarks, suggesting that El Salvador is attempting to strike a balance between its Bitcoin ambitions and international financial obligations.

A Controversial Bitcoin Strategy

El Salvador made global headlines in September 2021 when it adopted Bitcoin as legal tender alongside the U.S. dollar. While the decision was celebrated by Bitcoin advocates, it faced sharp criticism from the IMF. The organization warned that the move raised “macroeconomic, financial, and legal” concerns.

Since then, the IMF has repeatedly cautioned El Salvador about the potential risks of its Bitcoin experiment. However, in August 2024, the IMF admitted that many of the anticipated risks had not materialized. It acknowledged the need for “further efforts to enhance transparency and mitigate potential fiscal and financial stability risks” related to the Bitcoin initiative.

In October 2024, IMF spokesperson Julie Kozack reiterated that the organization had recommended limiting public sector exposure to Bitcoin.

El Salvador’s Continued Bitcoin Accumulation

Despite international pressure, El Salvador has remained committed to Bitcoin as part of its national strategy. The latest BTC purchase demonstrates the country’s intent to continue leveraging the cryptocurrency, even as it navigates the constraints imposed by its agreement with the IMF.

This calculated move highlights the broader tension between adopting innovative financial technologies and adhering to the expectations of traditional financial institutions. Whether El Salvador can successfully balance these competing priorities remains to be seen, but its latest Bitcoin purchase underscores the country’s resolve in maintaining its unique approach to cryptocurrency adoption.