El Salvador’s Bitcoin Initiative Encounters IMF Challenges and Restricted Public Engagement, According to NGO

El Salvador’s Bitcoin initiative seems to be struggling under the constraints of an International Monetary Fund (IMF) loan agreement and diminishing public interest, as reported by the non-profit organization My First Bitcoin.

Key Takeaways:

• The pace of Bitcoin adoption in El Salvador has decelerated due to IMF loan conditions and insufficient public education.
• The government has consented to cease new Bitcoin acquisitions despite publicly displaying its assets.
• The Chivo wallet is set to be privatized, raising concerns regarding the future role of Bitcoin in public services.

Quentin Ehrenmann, the general manager of the organization, stated that government-supported educational and adoption initiatives have stagnated since the IMF agreement, leaving everyday citizens uninformed.

“Since the government entered into this contract with the IMF, Bitcoin is no longer legal tender, and we haven’t seen any other effort to educate people,” Ehrenmann informed Reuters.

Bukele Discusses Bitcoin, Yet IMF Agreement Prevents New Acquisitions

Although President Nayib Bukele’s administration has continued to highlight its BTC holdings, the IMF disclosed that El Salvador agreed to refrain from acquiring more Bitcoin as part of the agreement.

This contradicts statements made by the country’s Bitcoin Office, which claimed that daily purchases were still occurring.

“The government, apparently, continues to accumulate Bitcoin, which is advantageous for the government — it’s not directly beneficial for the people,” Ehrenmann remarked.

For over two years in a small district in eastern El Salvador, Bitcoin enthusiasts have established a learning center and provided technical assistance to approximately 200 businesses and entrepreneurs on utilizing the cryptocurrency pic.twitter.com/S2bJ4YOYCf

— Reuters (@Reuters) July 25, 2025

In January, the nation’s legislature sought to reduce public sector participation in Bitcoin to comply with IMF loan stipulations.

This change has prompted inquiries regarding the long-term sustainability of El Salvador’s cryptocurrency policy and whether the initial vision has been quietly abandoned.

The Chivo wallet, once touted as a key element of the country’s Bitcoin adoption, will be removed from public oversight, and the IMF clarified that while the wallet will continue to function, it must be entirely privatized and no longer funded by the government.

As per the El Salvador Bitcoin Office, the country currently possesses approximately 6,244 BTC, valued at around $742 million.

Some blockchain analysts, including firms like Arkham, have noted consistent transfers of 1 BTC per day from exchanges such as Binance and Bitfinex to addresses allegedly associated with the Salvadoran government.

However, it remains uncertain whether these represent official purchases or private transactions.

Governments and Institutions Persist in Bitcoin Acquisitions

Other governments and organizations continue to grow their Bitcoin reserves. Japan’s Metaplanet recently purchased 797 Bitcoin for $93.6 million.

Meanwhile, The Blockchain Group in France and the UK’s Smarter Web Company collectively acquired over 340 BTC.

Strategy, the first Bitcoin treasury firm, reported $14 billion in unrealized gains in Q2 2025.

As previously reported, crypto analyst Ran Neuner suggested that crypto treasury firms are behaving less like buyers and more like exit strategies for crypto insiders.

Rather than acquiring assets directly from exchanges, these companies frequently receive crypto contributions from existing holders in exchange for shares that later trade at significant premiums on public markets.

Concerns regarding the sustainability of the crypto treasury trend are also increasing.

Last month, Glassnode lead analyst James Check expressed worries about the durability of the corporate Bitcoin treasury strategy, contending that the easy profits may already be depleted for new entrants as the market evolves.

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