El Salvador's IMF discussions will be unaffected by Bitcoin adoption

Douglas Rodriguez, head of El Salvador's Central Reserve Bank, rejected the concerns that the introduction of Bitcoin would jeopardize preparations for an IMF credit facility worth $1.3 billion.

 

Douglas Rodriguez stated that the government sees no concerns linked with the Bitcoin Law. According to Bloomberg, this comes as the government seeks to receive an extended credit facility from the International Monetary Fund (IMF).

 

El Salvador's central bank governor, predicts that a Bitcoin bull run may improve the country's GDP by up to 9% more than previously estimated.

 

"Bitcoin is simply a payment method" using the virtual currency to send money around the world, Rodriguez stated to the IMF

 

According to El Salvador's government, Bitcoin adoption is growing, with consumers using more US dollars to acquire BTC.

 

Uncertainty over the outcome of the IMF discussions, as well as the recent acceptance of Bitcoin as legal money, appear to have had a substantial impact on the country's credit rating.

 

El Salvador's bonds fell significantly in September following the country's "Bitcoin Day," emphasizing the need of the IMF loan agreement.

 

According to central bank statistics, with El Salvador's foreign debt expected to reach $18.45 billion in the second quarter of 2021, obtaining the IMF loan facility might be critical to assuring access to the global market in 2022.

 

IMF experts have slammed El Salvador's acceptance of Bitcoin, calling it a "inadvisable shortcut" that may have disastrous implications for the country.

 

Volatility and money laundering are among the potential systemic dangers posed by adopting BTC as legal cash, according to critics in the conventional banking sector.