According to a report, as part of an agreement with the International Monetary Fund (IMF), El Salvador will sell or stop using its state-run Bitcoin (BTC) wallet, Chivo. The action fits in line with the company’s plans to cut back on programs linked with Bitcoin under a $1.4 billion financing agreement. Bitcoin is still legal currency in El Salvador, but the deal calls for major modifications. Companies will now be free to choose to take Bitcoin on their own will, although taxes will still be due in US dollars.
However, Bitcoin prices dropped 4.5% Thursday to roughly $100,000 in noon trading. Notwithstanding these bottlenecks, El Salvador aims to keep adding Bitcoin to its reserves “at possibly an accelerated pace,” according to Stacy Herbert, director of the National Bitcoin office. She underlined that even as the Chivo wallet is taken down, private Bitcoin wallets across the nation will remain functional. The regulation changes show El Salvador’s attempt to strike a compromise between financial and international responsibilities and its innovative Bitcoin approach.
This article first appeared on GuruFocus.
