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Salvador Makes Concessions to IMF, But Little Changes Expected
In a recent development, Salvador has agreed to make concessions to the International Monetary Fund (IMF) in order to secure a $4.5 billion loan package. Despite this, many experts do not expect significant changes to take place as a result of these agreements.
The country’s President, Nayib Bukele, revealed that he holds approximately 5968.77 Bitcoins, worth around $597 million, and emphasized that the Bitcoin-related projects, including the development of Bitcoin capital markets and educational programs, will continue to remain intact. The IMF, however, has expressed concerns about these initiatives since September 2021 when President Bukele declared Bitcoin a legal tender in the country.
The IMF had previously warned that Salvador’s decision to adopt Bitcoin as a legal currency posed significant risks due to its high volatility. Despite this, the organization now seems satisfied with the concessions made by the country and expects the risks associated with using Bitcoin to decrease.
It is worth noting that not many Salvadorans have taken advantage of the Chivo registration offer, which initially provided 30 US dollars’ worth of Bitcoin for sign-ups. According to reports, more than 60% of beneficiaries had not carried out any transactions by mid-2022, and a recent survey found that nearly 90% of respondents did not use Bitcoin in 2023.
Despite these disappointing results, the IMF has agreed to provide Salvador with $1.4 billion as part of this loan package. The World Bank, Inter-American Development Bank, and regional development banks have also pledged additional funds worth $3.5 billion, bringing the total amount to an astonishing $4.5 billion.
The IMF’s decision to provide these funds comes despite its previous concerns regarding Salvador’s Bitcoin initiatives. It remains to be seen whether this loan package will bring about any meaningful changes in the country’s economic policy or simply perpetuate the status quo.
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Source: http://www.bitcoinbazis.hu
