El Salvador ditches Bitcoin wallet in IMF deal but plans to boost reserves

According to a report, as part of an agreement with the International Monetary Fund (IMF), El Salvador will sell or stop using the state-run Bitcoin (BTC) wallet, Chivo. The move fits into the company’s plans to scale back Bitcoin-related software under a $1.4 billion financing agreement. Bitcoin is still legal tender in El Salvador, but the transaction requires major adjustments. Businesses will now be free to choose to accept Bitcoin of their own volition, although taxes will still be due in US dollars.

However, Bitcoin prices fell 4.5% on Thursday to nearly $100,000 in afternoon trading. Despite these bottlenecks, El Salvador aims to continue adding Bitcoin to its reserves at an “accelerating pace,” according to Stacey Herbert, director of the National Bitcoin Office. She emphasized that even with the removal of Chivo’s wallet, private Bitcoin wallets across the country will remain functional. The regulatory changes show El Salvador’s attempt to reach a compromise between financial and international responsibilities and its innovative approach to Bitcoin.

This article first appeared on Gorovox.