The recent adoption of Bitcoin as a legal tender by the Central American nation El Salvador has not gone well with global financial agencies like the I.M. and the World Bank. As El Salvador continues to implement the new law, its $1 billion financing plan from the International Monetary Fund stays at a critical point. The IMF and El Salvador officials have been in consultation over the last few weeks ever since the country passed the new bitcoin law.
A top U.S. diplomat hopes IMF and El Salvador will settle the bitcoin row.
According to the Reuters report, a top U.S. diplomat said on Wednesday that she hoped El Salvador and the International Monetary Fund (IMF) would complete a financing agreement following the country’s dramatic move to make bitcoin a legal tender. El Salvador’s Congress has already approved President Nayib Bukele’s proposal to embrace the cryptocurrency, making the country the first in the world to adopt bitcoin as legal tender on Sept. 7.
Global regulators criticize El Salvador over bitcoin adoption.
The IMF said last week that discussions between its staff and El Salvador were ongoing, reiterating that it remained concerned over the decision. El Salvador’s historic decision to authorize bitcoin as a legal tender gained appreciation and support from the crypto community over the world, but the decision received criticism from the global regulators. World Bank had earlier refused El Salvador’s request to help the country transition to bitcoin. Several other economists also warned El Salvador of complete economic collapse because of its bitcoin law. However, El Salvador remains determined to implement the transition and make bitcoin an optional legal tender.