The International Monetary Fund has approved an immediate $138 million disbursement to El Salvador, clearing a critical funding hurdle despite the country missing agreed Bitcoin accumulation targets under its $1.4 billion financing program.
According to reporting by CoinTelegraph, the IMF’s Executive Board completed its second and third reviews of El Salvador’s 40-month Extended Fund Facility arrangement on Thursday. Rather than withhold funds over unmet criteria, the lender granted waivers based on what it termed “strong corrective measures and renewed commitments” from the government.
The decision signals a pragmatic shift in how multilateral institutions handle emerging-market nations integrating cryptocurrency into national strategy. El Salvador remains the only country to grant Bitcoin legal tender status, a policy that has drawn both the IMF’s scrutiny and sustained geopolitical attention.
The Bitcoin Waiver: What Changed
The core tension centered on Bitcoin accumulation. El Salvador had committed to specific holdings targets as part of its funding agreement, yet those benchmarks were not met. The government had publicly announced acquiring 1,090 BTC—worth roughly $100 million at the time—in November 2025, raising questions about whether these purchases violated IMF conditions on public spending.
The IMF’s resolution hinged on a critical distinction: the lender accepted documentation from Salvadoran authorities confirming the Bitcoin was acquired through private donations, not government budgets. This meant the accumulation did not breach fiscal commitments, even if it technically exceeded the agreed threshold.
“No further Bitcoin accumulation is envisaged beyond the documented donations,” the IMF stated in its press release, drawing a line for future conduct.
Governance Reforms Offset Asset Concerns
Beyond the Bitcoin waiver, the IMF highlighted substantive progress on institutional matters that likely influenced its decision to disburse. El Salvador transferred majority ownership and operational control of the Chivo Bitcoin wallet—the government’s digital asset platform—to a private operator. The government retained minority ownership and custodial responsibilities, a compromise that reduces direct state exposure to crypto volatility while maintaining oversight.
The lender also noted gains in financial sector reforms, fiscal transparency, and anti-money laundering compliance. These factors, combined with the private-donation explanation, provided enough political and technical cover for the Executive Board to approve continued funding.
Broader Implications for Sovereign Crypto Policy
The decision matters beyond El Salvador’s borders. As more nations explore central bank digital currencies and strategic Bitcoin reserves, the IMF’s handling of this case sets precedent for how multilateral creditors will evaluate and conditionally accept cryptocurrency-related fiscal policies.
The condition that “efforts will continue to reduce the state’s involvement in Bitcoin-related activities, strengthen crypto-asset regulation and governance, and enhance transparency” suggests the IMF views sovereign crypto holdings as acceptable only under strict governance frameworks—not as vehicles for monetary policy experimentation.
For El Salvador, the $138 million approves access to a crucial funding stream at a time when debt sustainability remains fragile. The waiver allows the government to continue its Bitcoin strategy without triggering fund suspension, though the IMF’s language makes clear further unilateral accumulation without pre-approval would jeopardize future disbursements.