IMF Urges El Salvador to Narrow Bitcoin Law and Limit Public Exposure
IMF's Concerns on El Salvador's Bitcoin Law
The International Monetary Fund (IMF) has reiterated its concerns about El Salvador's extensive engagement with Bitcoin. During a press conference, IMF spokesperson Julie Kozack discussed the need for a cautious approach to cryptocurrency due to its volatile nature.
Recommendations for Narrowing Bitcoin Law
Kozack stated, “What we have recommended is a narrowing of the scope of the Bitcoin law, strengthening the regulatory framework and oversight of the Bitcoin ecosystem, and limiting public sector exposure to Bitcoin.” This ongoing advice has been consistent since Bitcoin's legalization in 2021.
El Salvador's Bitcoin Expansion
Under Nayib Bukele's leadership, El Salvador has attempted to integrate Bitcoin into its economy. Innovative projects such as ‘Bitcoin City’ aim to create a tax-free haven for miners using volcanic energy, and Bitcoin bonds are being issued to raise capital. Despite this, the IMF has withheld $1.4 billion in financial aid due to concerns about financial risks related to Bitcoin adoption.
Current Bitcoin Market Position
As of recent reports, Bitcoin was trading at approximately $61,400. Last year's shift in market price triggered an 18% decrease in BTC-based remittances for El Salvador.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.