IMF Disburses $138 Million to El Salvador Following Bitcoin Waiver Approvals
The International Monetary Fund (IMF) has approved the immediate disbursement of approximately $138 million to El Salvador under its $1.4 billion financing program, despite the country missing certain performance criteria. The IMF granted waivers related to Bitcoin accumulation after El Salvador implemented strong corrective actions and demonstrated renewed commitment to reforms.
Approval of Disbursement Despite Missed Targets
The IMF’s Executive Board completed the second and third reviews under El Salvador’s 40-month Extended Fund Facility (EFF) arrangement. Although several performance criteria were missed, particularly concerning Bitcoin accumulation, the IMF granted waivers citing strong corrective actions and renewed commitments by the Salvadoran government.
The IMF highlighted progress made in financial sector reforms, fiscal transparency, anti-money laundering and counter-terrorism financing (AML/CFT) reforms, and the transfer of majority ownership and control of the government-run Chivo Bitcoin wallet to a private operator.
Reducing Government Involvement in Crypto Activities
The IMF stated that ongoing efforts will focus on reducing the state's involvement in Bitcoin-related activities, enhancing crypto-asset regulation and governance, and increasing transparency of public-sector crypto holdings. It was emphasized that no further Bitcoin accumulation is planned beyond documented private donations.
The institution noted that after the first review in June 2025, El Salvador did not use public funds to accumulate Bitcoin, with all increases verified as stemming from private donations.
Transfer of Chivo Control to Private Operator
While the government retained a minority stake and custodial duties, majority ownership and operational control of the Chivo wallet have been transferred to a private entity. This was a key measure to bolster financial stability and confidence in the Bitcoin wallet project.
This move also addressed IMF concerns about government resource use in acquiring digital currencies.
Background and Recent Developments
In November 2025, El Salvador declared it had acquired 1,090 BTC worth $100 million, prompting questions about compliance with IMF program conditions. However, subsequent documentation confirmed these accumulations were funded by private donations, not government resources.
This clarification resolved compliance issues, allowing continued partnership between the IMF and El Salvador.
Why it matters
This news highlights the ongoing complex interaction between international financial institutions and nations adopting cryptocurrency initiatives. Despite initial breaches of funding program conditions—particularly regarding Bitcoin accumulation—El Salvador's willingness to implement corrective measures, increase transparency, and transfer management of state crypto assets to the private sector enabled it to secure crucial IMF funds. It underscores that integrating innovative financial approaches with compliance to international norms and standards can sustain trust and support from global financial entities.
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