If the International Monetary Fund (IMF) still calls on El Salvador to consider the risks of using Bitcoin as legal tender, the institution recognizes that said risks have not yet materialized. Are these the timid beginnings of a change of position?
The IMF reconsiders the use of Bitcoin in El Salvador
After a visit to El Salvador between the end of January and the beginning of February, a delegation from the International Monetary Fund (IMF) established conclusions on the financial situation of the country, and returned in particular on its use of Bitcoin (BTC) as legal tender.
While the institution strongly opposed the initiative of President Nayib Bukele, brandishing for example the threat of refusal of loans, the speeches seem to have been nuanced somewhat. Indeed, if the IMF is still opposed to El Salvador’s choices, stating that “bitcoin risks should be considered“, the organization also indicates that said risks have not yet materialized :
“Although the risks have not materialized due to the limited use of Bitcoin so far, as suggested by survey and remittance data, its use could increase given its legal tender status and new legislative reforms to encourage the use of crypto-assets, including tokenized bonds. »
Although the road is still very long before the IMF dubs Bitcointhe catastrophe predictions are therefore not yet realized.
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An improving economic situation, but which can change
More generally, the IMF has identified several positive points in El Salvador’s financial situation, although there are areas for improvement to highlight. Thus, the country’s economy grew by 2.8% in 2022to return to pre-pandemic levels.
The International Monetary Fund also notes a drastic decrease in crime, coupled with an increase in tourism-related income. Nevertheless, El Salvador is not spared from inflation, with an annual level of 7.2%. In addition, the State deficit, for its part, reached 8% of GDP.
It’s also worth putting bitcoin’s position in perspective in this data, because to date, El Salvador would hold “only” 2,381 BTC, which represents $52 million. In 2022, the Minister of Finance, Alejandro Zelaya, had also declared that these assets represented 0.5% of the state budget.
👉 Also in the news – The LocalBitcoins platform announces its closure after 10 years of activity
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Sources: International Monetary Fund, BitcoinTreasury
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