The Executive Board of the International Monetary Fund (IMF) has recommended that El Salvador deprive the first crypto of the status of a legal means of payment in the country.
Although IMF representatives have admitted that the Chivo e-wallet could increase financial inclusion, they have noted the need for strict regulation of Bitcoin. They have also recalled the financial stability risks associated with the use of BTC.
The organization is concerned about El Salvador’s plans to issue Bitcoin bonds worth $1 billion. The state is in talks with the IMF for a $1.3 billion loan.
A law recognizing digital gold as a legal means of payment came into force in El Salvador on September 7, 2021. The government of the country purchased 550 BTC for the state fund then.