IMF Clears $139 Million Disbursement to El Salvador After Bitcoin Breach

The International Monetary Fund (IMF) has approved an immediate disbursement of about $138 million to El Salvador after granting a waiver for the country’s failure to meet a program condition related to Bitcoin accumulation.

The IMF Executive Board completed the second and third reviews of El Salvador’s $1.4 billion Extended Fund Facility (EFF) arrangement on October 1, clearing the way for the latest funding tranche. The waiver was granted after Salvadoran authorities took corrective measures and renewed their commitments under the program.

IMF Maintains Restrictions on El Salvador’s Bitcoin Accumulation

Although the waiver allows the financing program to continue, it does not remove the restrictions surrounding Bitcoin. The IMF said no further accumulation is expected beyond documented donations, while efforts to reduce the state’s involvement in Bitcoin-related activities will continue.

El Salvador made Bitcoin legal tender alongside the U.S. dollar in 2021 and subsequently incorporated the digital asset into its public-sector strategy. Bitcoin-related policies have remained a significant point of discussion within the country’s IMF program, particularly as the Fund has sought to limit the government’s exposure to crypto assets.

The latest review indicates that the government has been unwinding its involvement in the state-run Chivo wallet. Majority ownership and operational control of Chivo have been transferred to a private operator, while the IMF said remaining public-sector exposure should ultimately be eliminated.

Bitcoin Conditions Remain Part of IMF Program

The waiver does not eliminate the Bitcoin-related requirements attached to El Salvador’s financing program. Instead, the Fund has accepted the breach based on corrective measures while maintaining its expectations for future implementation.

This means additional deviations from the agreed conditions could require further waivers and reviews. The arrangement therefore continues to link the government's management of public-sector Bitcoin exposure with its access to IMF financing.

The IMF's lending programs typically include conditionality, requiring recipient countries to meet specific economic and policy targets before funds are released. In El Salvador’s case, Bitcoin accumulation has formed part of those conditions, making the latest waiver notable within the broader evolution of sovereign crypto-asset policies.

IMF Reports Stronger Economic Growth in El Salvador

Beyond the Bitcoin issue, the IMF reported stronger-than-expected economic activity in El Salvador, supported by continued improvements in security and higher investor confidence.

The Fund projects real GDP growth of 4.5% in 2026 and 4% in 2027. It also highlighted progress in fiscal consolidation, liquidity and reserve buffers, financial-sector reforms, governance, transparency, and anti-money laundering measures.

The IMF said the broader program will continue to focus on fiscal sustainability, rebuilding external buffers, strengthening financial-sector resilience, and improving governance and transparency.

IMF Seeks Greater Transparency Around Public-Sector Crypto Holdings

The Fund also wants El Salvador to strengthen transparency around its public-sector crypto assets and improve the regulatory and supervisory framework governing digital assets.

The IMF specifically called for enhanced disclosure of public-sector crypto holdings and stronger governance and risk-management arrangements. It also said the government should continue reducing its involvement in Bitcoin-related activities while strengthening regulation of crypto-asset providers.

The precise scope of the latest waiver is not fully detailed in the IMF's public announcement. However, the Fund's statement makes clear that the waiver does not represent an unrestricted green light for additional government Bitcoin accumulation.

What the IMF Decision Means for El Salvador’s Bitcoin Strategy

The decision highlights a more nuanced relationship between sovereign Bitcoin adoption and international financing. Rather than ending El Salvador’s IMF program over the Bitcoin-related breach, the Fund opted for a waiver while maintaining restrictions on further accumulation and pushing for reduced state involvement.

This suggests that the immediate issue is less about whether a government can hold Bitcoin at all and more about how that exposure is governed, disclosed, and incorporated into broader fiscal and financial-risk frameworks. As more governments consider holding digital assets, the conditions attached to El Salvador’s program could provide an important reference point for how international lenders address sovereign crypto exposure.