World's First Bitcoin Nation Revises Ambitious Crypto Plans
World's First Bitcoin Nation Revises Ambitious Crypto Plans.
El Salvador has finalized a loan agreement worth $1.4 billion (£1.1 billion) with the International Monetary Fund (IMF) following its decision to reduce its contentious bitcoin policies.
The international financial institution indicated that the risks associated with the use of the largest cryptocurrency have diminished, as businesses will now have the autonomy to choose whether to accept bitcoin.
In 2021, El Salvador made history by becoming the first nation globally to recognize bitcoin as legal tender.
Recently, the cryptocurrency reached a new peak, surpassing $108,000.
"The potential risks of the Bitcoin project will be diminished significantly in line with Fund policies," the IMF announcement said.
"Legal reforms will make acceptance of Bitcoin by the private sector voluntary. For the public sector, engagement in Bitcoin-related economic activities and transactions in and purchases of Bitcoin will be confined."
The agreement, intended to bolster El Salvador's economy, still requires approval from the executive board of the International Monetary Fund (IMF).
The IMF has expressed opposition to the cryptocurrency-friendly policies of Salvadoran President Nayib Bukele, cautioning that these policies may hinder the provision of financial assistance.
Despite this, Bukele took to social media to celebrate the surge in bitcoin's value following Donald Trump's election victory in November.
Earlier this month, as bitcoin's price exceeded $100,000 for the first time, Bukele announced on social media that the value of his country's cryptocurrency holdings had more than doubled.
He attributed the missed opportunities for many Salvadorans to his political adversaries.
The cryptocurrency market has experienced a significant upswing since Donald Trump's election victory on November 5.
The forthcoming Trump administration is perceived as more supportive of cryptocurrencies compared to the current administration under President Joe Biden.
On Thursday, however, the cryptocurrency market experienced a decline alongside global stock markets after the US Federal Reserve indicated a slower approach to interest rate reductions in the coming year.
Bitcoin is presently trading at approximately $100,000.
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