The International Monetary Fund (IMF) has urged El Salvador
to stop accumulating Bitcoin through both purchases and mining, according to a
new Staff Country Report. The recommendation is part of the conditions tied to
the country’s $1.4 billion loan agreement, Forbes reported.
Meanwhile, BTCUSD is hovering near the support level, where
it rebounded earlier today after two bearish days. Traders may closely watch
the price action at this level to assess its next intraday direction.
El Salvador Faces IMF Bitcoin Restrictions
El Salvador adopted Bitcoin as legal tender in 2021, drawing
global attention. However, the IMF has consistently expressed concerns about
the policy. The latest report calls for the country to liquidate the fund
created to purchase Bitcoin. The IMF also wants the public sector to halt all
involvement with the cryptocurrency.
BREAKING: 🇸🇻 The IMF demands El Salvador stops buying bitcoin as a condition of further funding. pic.twitter.com/8FlggV090U
— Bitcoin Archive (@BTC_Archive) March 4, 2025
The report acknowledges El Salvador’s progress in certain
areas, including improved security and a rise in tourism. However, the IMF
highlights ongoing macroeconomic imbalances, fiscal deficits, and substantial
debt. The loan agreement could unlock up to $3.5 billion in additional
financing from organizations like the World Bank and the Inter-American
Development Bank.
Bukele Agrees to IMF Bitcoin Terms
President Nayib Bukele has shifted his stance on the IMF. He
initially dismissed the fund’s concerns but later made changes to the Bitcoin
Law and agreed to cease public Bitcoin involvement. The report states that
Bukele’s administration aims to address structural economic challenges under
the IMF-supported program.
NEW: 🇸🇻 The IMF demands El Salvador stops buying #Bitcoin as a condition of further funding. They proceed to buy 5 more Bitcoin last night 💪 pic.twitter.com/NMUoLE72sn
— Swan (@Swan) March 4, 2025
El Salvador must fully comply with the IMF’s recommendations
by December 2025. The country is required to disclose all Bitcoin holdings by
the end of March, listing assets managed by public entities such as Chivo, the
Bitcoin Management Agency, and the Lempa River Hydroelectric Power Plant. A
second review of this process is scheduled for June.
BTCUSD Tests Support After Bearish Trend
The BTCUSD H1 chart indicates a bearish trend after the
price was rejected at the 95,000 level. Following the formation of a double
top, the price continued its downward movement until it found support and
bounced at 82,450.
As of now, the cryptocurrency is trading right at this
critical support level. If the price breaks below this support, followed by a
confirmed breakout, the bearish trend could continue for a while, potentially
driving the price even lower.
On the other hand, if a bullish reversal pattern forms at
the support level, it may attract buyers, leading to upward momentum. This
could push the price back toward the North, reversing the recent bearish trend
and possibly initiating a new bullish phase.
This article was written by Tareq Sikder at www.financemagnates.com.
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