By: Staff writer
July 22, 2025
The International Monetary Fuund (IMF) in their July 15 Article IV Consultation report for El Salvador warned that the country should continue to mitigate risk associated with bitcoin and further unwind any investment in the country’s Chivo e-wallet.
The fund also claimed hat the Central American country has not bought any new Bitcoin since signing the agreement in December 2024.
El Salvador’s Chivo Bitcoin wallet “does not adjust its Bitcoin reserves to reflect changes in clients’ Bitcoin deposits,” the report read. Chivo doesn’t sell its BTC, leading to “minor” discrepancies that made it appear that El Salvador’s public sector was accumulating BTC.
A letter of intent signed by El Salvador’s central bank president, Douglas Pablo Rodríguez Fuentes, and minister of finance, Jerson Rogelio Posada Molina, contained within the IMF report, confirmed the details:
The government of El Salvador signed a $1.4 billion loan deal with the IMF in December 2024 and agreed to scale back its involvement in Bitcoin under the loan offer.
In January 2025, El Salvador’s legislature revised the Bitcoin laws, making acceptance of BTC as legal tender voluntary, while also agreeing to stop accumulating BTC using taxpayer money.
Despite this, El Salvador’s Bitcoin Office continued to claim the government was steadily accumulating BTC, flying in the face of the IMF deal.
The Article IV Consultation also said: “Directors encouraged mitigating risks from the use of Bitcoin and boosting the oversight of crypto assets. They stressed the need to unwind the public sector’s participation in the government e-wallet (Chivo) and to not increase overall Bitcoin holdings by the public sector and underscored the importance of clear and consistent communication in this regard. Directors also emphasized the need to enhance the autonomy of the central bank and strengthen its capital position and boost international reserves.
The IMF also said: “In line with program commitments, by end-March (i) the primary balance of the nonfinancial public sector (NFPS) (US$209 million) exceeded the program floor (US$180 million); (ii) NFPS deposits at the BCR (US$702 million) stood well above the adjusted floor (US$475 million);9F 10 (iii) the ratio of liquid assets to total deposits reached 13.1 percent; and (iv) there was no net accumulation of either domestic payment arrears or external public-sector arrears. However, deviations arose on account of a higher-than-programmed net borrowing by the NFPS, reflecting some frontloading of debt issuances, although these have been recently addressed by using the government deposit overperformance to buyback Treasury debt. In addition, the continuous QPC preventing the issuance or guarantee by the public sector of Bitcoin-denominated or indexed debt or tokenized instruments was met. However, despite adherence to the commitment not to voluntarily accumulate Bitcoin, the continuous QPC on voluntary Bitcoin accumulation was missed with minor margins on account of temporary fluctuations in Chivo clients’ deposits denominated in Bitcoin.10F 11 Corrective actions have been taken to establish a sufficient buffer to mitigate the risk of future breaches prior to the planned sale of Chivo.”