El Salvador’s government recently announced it poured millions into Bitcoin, but the International Monetary Fund (IMF) isn’t buying it. The IMF insists the Central American nation hasn’t added more digital coins. This makes people wonder if the government’s announcements are true.
The IMF has stated again that El Salvador is not growing its Bitcoin stash. This stands firm against what President Nayib Bukele’s government has officially claimed. The global body believes recent movements only show money shuffling between government accounts, not new purchases. This fuels arguments about how transparent the country is with its cryptocurrency actions.
Meera Louis, a communications official for the IMF, confirmed this, according to a report from Cryptopolitan. She said, “the total Bitcoin owned by the government has not increased.” Louis added that any rise in the Bitcoin Reserve Fund is just money moving between government wallets. The IMF feels that on-chain data and Bukele’s statements don’t prove new buys. They seem to show existing assets simply moving around.
The USD $1.4 Billion Deal and Its Rules
El Salvador took on a USD $1.4 billion loan. A big catch for this money was that the country had to cut back its Bitcoin activity. It also had to stop buying new coins. This deal was supposed to help stabilize the nation’s finances and lower risks from Bitcoin’s up-and-down prices. However, online data and government messages suggest El Salvador is still adding Bitcoin to its books.
President Bukele had promised back in November 2022 to buy one Bitcoin every day. Just last weekend, he announced buying 21 more Bitcoins, costing USD $2.3 million. This purchase was to celebrate the fourth anniversary of the Bitcoin Law. The country’s Bitcoin Office states El Salvador now holds 6,318 Bitcoins, valued at nearly USD $726.8 million. They claim to have added 28 Bitcoins in the last week and 51 Bitcoins since last month.
Conflicting Stories and Missing Records
The IMF says these numbers can’t be confirmed as new purchases. But El Salvador’s government argues that Bitcoins keep flowing daily into their wallets from places like Binance and Bitfinex. Until recently, the only updates on these deals came from the president’s own tweets. He even joked about buying Bitcoin “from his phone in the bathroom.”
The company Bubblemaps partly agrees with the IMF. They warn that it’s tough to know exactly when the transferred Bitcoins were actually bought. Their analysis suggests these Bitcoins could have been purchased before the 2024 agreement with the IMF. They might have just sat quietly in exchange accounts before being sent to public wallets. Bubblemaps also pointed out that these movements could be made to look like new purchases when they aren’t.
Criticism of Bukele’s Management
James Bosworth, founder and CEO of Hxagon, called out the lack of clear information. He hinted that Bukele might be shifting digital assets to fake trades. Bosworth called this a type of government “wash trade.” He stressed that Bitcoins belong to the state. They should not be managed like the president’s personal piggy bank.
In March, Bukele had already said he would keep buying Bitcoin even with the IMF agreement. He declared, “If purchases weren’t stopped when the country was pushed aside internationally, they won’t stop now either.” This stubborn stance increases tension with the global financial group. It also questions how effective the signed agreement really is.
Bigger Picture, Bigger Fight
El Salvador made global headlines in 2021 as the first country to make Bitcoin legal tender. This move brought both worldwide attention and criticism from international groups. The IMF sees the program as a money risk for the country. It demands more transparency and control. But for Bukele, continuing Bitcoin purchases shows economic freedom and a belief in long-term gains.
On July 15, a letter signed by the Central Bank President, Douglas Pablo Rodríguez Fuentes, and the Minister of Finance, Jerson Rogelio Posada Molina, came to light. It showed El Salvador gave the IMF the addresses for all its cold and hot wallets for review. Yet, the IMF still states that the total amount of Bitcoins in public hands remains unchanged. This strengthens their argument that no new purchases have been made.
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