IMF warns El Salvador: government should reconsider plans to increase Bitcoin exposure


(Kitco News) The International Monetary Fund (IMF) warned El Salvador against the country’s Bitcoin-exposure risks and called for more transparency.

El Salvador became the first country to adopt Bitcoin as a legal tender in 2021. The country then went on a Bitcoin buying spree, but the government has not been forthcoming on how much Bitcoin it has bought.

Based on President Nayib Bukele’s tweets, El Salvador acquired 2,381 bitcoins, but that is not counting Bukele’s November promise to buy one Bitcoin every day starting November 18.

There is no official record of how much El Salvador bought so far. Reuters estimated that the country bought around 2,470 bitcoins for around $106.4 million.

After a visit to the country, the IMF pointed to risks associated with the country’s exposure to the cryptocurrency, calling on El Salvador to address them.

“While risks have not materialized due to the limited Bitcoin use so far—as suggested by survey and remittances data—its use could grow given its legal tender status and new legislative reforms to encourage the use of…

Read more…