IMF says El Salvador has stopped public Bitcoin purchases and approved $140 million in allocation

The International Monetary Fund has confirmed that El Salvador has not used public funds to purchase Bitcoin since June 2025 and lifted a new round of financing restrictions.

The International Monetary Fund (IMF) recently stated that El Salvador has not used public funds to purchase Bitcoin since June 2025. The statement is based on the results of an ongoing review of the country's financing arrangements with the IMF. As part of the review, the IMF approved an additional allocation of $140 million.

In 2021, El Salvador became the first country in the world to designate Bitcoin as legal tender. Subsequently, the government established state-run Bitcoin reserves through its "Bitcoin Office" and made purchases public as part of a broader economic strategy. This approach has attracted the attention of international lending institutions, who are concerned that it may pose fiscal risks and financial stability issues.

As early as early as the beginning of 2025, El Salvador reached a loan agreement with the IMF worth approximately US$1.4 billion. The agreement comes with a series of conditions designed to limit the government's direct exposure to Bitcoin price fluctuations. According to reports, these conditions include restrictions on the use of public funds to further accumulate Bitcoin tokens.

The latest IMF statement shows that El Salvador has been abiding by these limits since mid-2025. This confirmation by the Fund appears to be a formal node in its ongoing project review process. Normally, allocations under IMF arrangements are subject to regular assessments of whether the borrower meets the terms of the agreement.

El Salvador's Bitcoin positions accumulated before June 2025 still form part of the country's reserves. The IMF's findings only address new purchases funded by public treasuries and do not address the handling of existing positions. It is unclear whether the government used other sources of funding, such as private funds or off-budget mechanisms, to acquire Bitcoin during this period.

This development reflects a broader trend in global finance. Governments trying to build cryptocurrency reserves are increasingly facing conditionalities from multilateral lending institutions. Historically, institutions such as the IMF have opposed the adoption of Bitcoin at the national level on the grounds of volatility and transparency issues. The case of El Salvador has become a litmus test of how such tensions can be resolved in practice.

This $140 million allocation represents part of a broader loan package that El Salvador has agreed with the IMF. The speed of future allocations is likely to depend on the country's continued compliance with project terms. Investors and policymakers are watching closely how El Salvador balances its Bitcoin strategy with its financial obligations to the IMF.

Market impact

The IMF's confirmation may allay concerns among international lenders about El Salvador's fiscal discipline. Continued access to IMF financing depends on the country maintaining its commitments under the loan facility. A stable allocation timetable is expected to increase confidence in El Salvador's macroeconomic stability.

For the cryptocurrency market, this news has limited direct impact on prices. It did not indicate that the government had a new bitcoin purchase plan, nor did it imply that El Salvador planned to sell existing positions. This update mainly clarifies compliance in sovereign lending and lending relationships, rather than signaling a shift in demand in the Bitcoin market.

The IMF statement provides a rare data point showing how sovereign bitcoin adopters respond to multilateral lending conditions. El Salvador's future allocations are likely to depend on its continued compliance with the terms of the projects funded.

FAQs

What information has the IMF confirmed about Bitcoin purchases in El Salvador?

The IMF said that as part of a review of its financing plan, El Salvador has not used public funds to purchase Bitcoin since June 2025.

What does the $140 million grant have to do with?

The allocation is part of El Salvador's broader lending arrangement with the IMF and is released after the IMF confirms that it meets project conditions.

Does this mean that El Salvador has sold its existing Bitcoin positions?

No. The IMF's findings involved new purchases using public funds and did not involve Bitcoin acquired by El Salvador before June 2025.

Why did the IMF impose conditions on Bitcoin activity in El Salvador?

Due to concerns about fiscal risks and financial stability, El Salvador reached a loan arrangement with the IMF in early 2025 included clauses to limit public bitcoin spending.