President says El Salvador’s won’t stop buying Bitcoin following IMF claim –  ‘Proof of work > proof of whining’

The El Salvador government recently signed a $1.4B financing deal with the IMF. The deal includes measures aimed at reducing the country’s Bitcoin exposure. Despite the agreement, El Salvador has continued to increase its Bitcoin portfolio. 

The El Salvador government has continued its effort to bolster the country’s economy with Bitcoin. The International Monetary Fund (IMF) however, has expressed concern for the country’s financial stability as cryptocurrencies are known for their volatility. 

In 2024, the El Salvador government agreed to scale back on its Bitcoin ambitions in exchange for a much-needed billion-dollar loan. The deal with the IMF included measures such as businesses in El Salvador no longer being mandated to accept Bitcoin and the payment of taxes in US dollars and not cryptocurrency. 

However, El Salvador President, Nayib Bukele is now reneging on the deal and sticking to his Bitcoin strategy. 

El Salvador’s $1.4B deal 

In 2024, the IMF released a statement saying that in exchange for the financial aid program to support the government’s economic overhaul agenda, the El Salvador government agreed to implement measures to mitigate bitcoin-related risks. 

The decision to make Bitcoin a legal tender in the country was met with cheers from crypto enthusiasts, but it caused a delay in the country receiving financial support from the IMF as there were concerns about the volatility of crypto assets. The IMF believed that the introduction of Bitcoin as a legal tender would cause further decline in the finances of El Salvador, an already impoverished and indebted nation.

The government of the country did not share these concerns and set its Bitcoin ambitions in motion, purchasing one Bitcoin daily since November 2022. 

While the country’s adoption of Bitcoin became more accepted over time, problems like the volatility of digital assets and the lack of understanding of Bitcoin and cryptocurrencies has led most of the population to opt for the US dollar for their transactions. This, of course, did not deter the government from building its Bitcoin reserve. 

Data indicates that the El Salvador government now holds approximately 6,101 BTC, valued at around $527 million at current market prices. The country’s latest acquisition of 19 BTC is a lump sum accumulated over multiple previous purchases made in January and February, even after the IMF agreement was finalized. 

El Salvador’s Bitcoin portfolio. Source: The Bitcoin Office

The IMF’s financial aid agreement with El Salvador includes specific measures to limit the government’s involvement with Bitcoin. These measures include a ban on new acquisitions, so it was expected that the country would stop its Bitcoin acquisition. However, El Salvador’s President Nayib Bukele is clearly ignoring these restrictions. Bukele posted on social media platform X that the country’s Bitcoin purchases would continue.

“This all stops in April. stops in June. This all stops in December. No, it’s not stopping. If it didn’t stop when the world ostracized us and most ‘bitcoiners’ abandoned us, it won’t stop now, and it won’t stop in the future. Proof of work > proof of whining,” He said. 

“This all stops in April.” “This all stops in June.” “This all stops in December.”

No, it’s not stopping.

If it didn’t stop when the world ostracized us and most “bitcoiners” abandoned us, it won’t stop now, and it won’t stop in the future.

Proof of work > proof of whining

— Nayib Bukele (@nayibbukele) March 4, 2025

The IMF has not made any comments regarding Bukele’s disregard for the agreed terms. 

As a part of the deal, the El Salvador government is required to publish all wallet addresses used for Bitcoin transactions. Audited financial statements must also be released for crypto-related government entities.

The Fidebitcoin trust fund must also be liquidated by July 2025, in accordance with the agreement. The trust fund was originally established to support Bitcoin adoption in El Salvador. The government is also expected to withdraw from direct involvement in the country’s official Bitcoin payment platform, the Chivo Wallet system. 

The agreement between the IMF and El Salvador is anticipated to draw in supplementary funding from the World Bank and other regional development banks. The country’s $1.4B deal with the IMF is expected to snowball into $3.5B with the support from these other financial organizations. 

The IMF said in a release that, “the program is also expected to catalyze additional financial support from the World Bank, the Inter-American Development Bank, and other regional development banks (Central American Bank for Economic Integration, CABEI, Development Bank of Latin America and the Caribbean, CAF) for a combined overall financing package of over US$ 3.5 billion over the program period.” 

El Salvador is now looking into alternative strategies

Although Bukele’s strategy started with Bitcoin adoption, it has expanded over time to include the booming AI and tech industry. The government is adjusting the regulatory framework and pushing policies that are sure to attract tech companies and improve the country’s economic future. 

On March 2, official accounts posted photos of Bukele’s meetings with Ben Horowitz and Marc Andreessen, the co-founders of a16z, discussing technology and AI investment opportunities.

El Salvador’s President, Nayib Bukele recently met Ben Horowitz and Marc Andreessen, the co-founders of Andreessen Horowitz (a16z) at Casa Presidencial. Source: The Bitcoin Office.

El Salvador wants to become a regional tech hub and a leading destination for entrepreneurs and investors. 

To achieve this, El Salvador is offering incentives such as a 0% tax rate for companies in tech industries. Tether, the issuer of the world’s largest USDT stablecoin has already migrated its head office to the Central American nation. 

The government also created the National Artificial Intelligence Agency (ANIA). This agency operates under the Office of the Presidency to oversee AI-related activities in the country.