Bitcoin ceased to be the legal tender in El Salvador

[Fiatless]

It has no negative effect on bitcoin.

El Salvador is not even a country like United States which such news might cause decrease in bitcoin price but which also will later be followed by bull run.

The news didn't have any effect because the conditions for the loan don't include the selling of the country's Bitcoin hodling. They can keep investing in Bitcoin as much as they can afford.

However, I used to have high hopes that other nations would join El Salvador to make Bitcoin a legal tender. The only country that tried to follow El Salvador was the Central African Republic, but the law was repelled after a few months. It used to be a source of pride to Bitcoiners that the currency is a legal tender in a nation. No more bragging about El Salvador except for its huge investment in Bitcoin.

[moneystery]

this is a setback in the adoption of bitcoin in el salvador, but i see that they also have no option to refuse since they also need loans for the government reforms they are running.

but from here we can see that the imf really hates countries that adopt bitcoin as their legal tender. they make weird rules against bitcoin to make countries that are related to bitcoin to reduce their closeness to it. basically a shameless institution.

fortunately, they still stand firm in their stance to make bitcoin a legal tender and continue to invest in it, even though there are rules that have changed.

[Z-tight]

What El Salvador failed to do when they discovered BTC was invest in it much more aggressively, because if they had several tens of thousands of BTC in their possession today, then they might not need the help of the vultures from the IMF.

I believe they could not buy much more than they have already acquired, they are a poor country and to be honest it may be more difficult for them to have the funds to buy as aggressively as you propose here. The IMF have been fighting the BTC idea in El Salvador and they finally have gotten their way, to think of it, it is weird and crazy how much effort them have put into forcing El Salvador to rescind their policy on BTC.

[franky1]

What a way to declare power to the fiat. This just means one thing; the IMF aren't really I support of the fact that El Salvador declared the use of Bitcoin as legal tender but I thought that with the number of Bitcoin the country has accumulated over the years should have been enough to fund their projects?

when he was buying BTC he was buying it in the period(avg $45k) where if cashed out now would only be a 110% gain. he has not held long enough to hit a multi-cycle multiplier*.

*he was buying during 2021 ATH and we have yet to have the 2025 ATH, so not even one cycle has passed for him

 also by funding projects requires money spent, meaning when other surprises pop up, he then has to find money elsewhere. so while locking up funds in one hand left him empty handed with the other hand, causing him to need to go crying back to IMF daddy asking for some money. i kind of blame his financial advisors for not being better economists to have advised him when the best times to buy and sell bitcoin to maximise investments whilst not leaving them empty fiat handed.

the IMF have proven that el salvador(amongst other countries) are not sovereign countries but simply puppets to a international puppeteer, by back peddling a law that was a step in the direction of independence and sovereignty. and so they have now lost that chance, and made it harder to double back peddle to try to escape again later**

**basic common sense investment advise that even normal citizens should remember and listen to, dont throw all your excess income, savings and emergency fund into investments, because when surprises occur you have to either sell investments early or apply for credit(dont throw all eggs into one basket), keep an emergency fund/savings amount to cover financial surprises. so that you dont end up getting into further problems owing someone who puts conditions on you

[Kelward]

I don't think such order is going to affect bitcoin in any way. Bitcoin is not banned in El Salvador, the citizens are only given the option to choose to accept Bitcoin or not. Without being biased, I think it is also proper for a country that has more than one legal currencies to grant their citizens the right to choose what they wish to accept at a particular point, especially when it has to do with a digital currency which many might not really understand how it works. Everything is all about agreement between the two parties involved in the transaction.

The most important thing to note is that Bitcoin is not banned in El Salvador, so not being their legal tender is due to circumstances that regards their loan matter. So far people can still use Bitcoin for payments in their country, it means that nothing much has changed in terms of it's recognition as a currency. People in El Salvador, can now have a choice whether to accept Bitcoin or not, and in a way it'll be a test of how people are willing to accept Bitcoin in that country. IMF can not stop the adoption of Bitcoin, if not for the loan that El Salvador, needs, I know that they wouldn't contemplate removing Bitcoin as their legal tender.

[Smack That Ace]

They're the first country to declare Bitcoin legal tender, and now the first to drop it. --- gosh they're setting world records!

If I remember correctly El Salvador was the first country to make bitcoin legal tender but the first country to drop it was the Central African Republic, not them.

If only they really had a choice... This country needed funding, so they had to play by the rules.

This may seem harsh, but it shows us the truth: although El Salvador has made significant profits from its bitcoin investment but bitcoin cannot and is not the factor that has caused El Salvador's economy to improve in recent years as many people think. If bitcoin can really help them improve their national economies, they won't have to accept IMF regulations and borrow money from them.

But actually, even though Bitcoin is legal in El Salvador, people hardly use it for everyday transactions. It pretty much shows what's really happening so the change is not hard to accept.

As far as I know, most people still use USD instead of bitcoin and while this is seen as a step backwards, you are right, it has no significant impact at all.

[stadus]

They're the first country to declare Bitcoin legal tender, and now the first to drop it. --- gosh they're setting world records!

If I remember correctly El Salvador was the first country to make bitcoin legal tender but the first country to drop it was the Central African Republic, not them.

I guess you are right, as it says here. ( they dropped it in 2023)

CAR to drop crypto as legal tender

If only they really had a choice... This country needed funding, so they had to play by the rules.

This may seem harsh, but it shows us the truth: although El Salvador has made significant profits from its bitcoin investment but bitcoin cannot and is not the factor that has caused El Salvador's economy to improve in recent years as many people think. If bitcoin can really help them improve their national economies, they won't have to accept IMF regulations and borrow money from them.

Their investment in Bitcoin isn't huge as they're more banking on the future and using their Bitcoin stance to attract investment. Right now, for a country known for high debt that relies heavily on borrowing to run its economy, they need funding to push through their development plans. But that means sacrificing something big for them, even if it doesn't seem like much in everyday practice.

[Lucius]

What El Salvador failed to do when they discovered BTC was invest in it much more aggressively, because if they had several tens of thousands of BTC in their possession today, then they might not need the help of the vultures from the IMF.

I believe they could not buy much more than they have already acquired, they are a poor country and to be honest it may be more difficult for them to have the funds to buy as aggressively as you propose here. The IMF have been fighting the BTC idea in El Salvador and they finally have gotten their way, to think of it, it is weird and crazy how much effort them have put into forcing El Salvador to rescind their policy on BTC.

The fact is that they started buying BTC during 2021 (if I'm not mistaken), and that during that period the price was much lower than today, with one very favorable period for investing during 2022 where the price dropped to only $15.5k. Then they bought much larger quantities, and then at one point the president decided to change the strategy to 1 BTC per day, which significantly slowed down the increase of their reserves.

It follows from all this that the president tried to sit on two chairs at the same time, but that he is increasingly choosing the chair offered to him by the IMF. Unfortunately, the IMF was just waiting for the right moment to put even more pressure on them, and it is not ruled out that in the future the ES will sell its BTC as a condition for a new loan.

[bettercrypto]

As far as I know, El Salvador is still positive for bitcoin, so whatever the op's perception is, I think it's just his story or his assessment. Because it seems to me that the op is spreading FUD.

This is just my opinion, that's why I said this. Because I believe that El Salvador knows what they're going to do about Bitcoin.
Then of course they're just balancing things out.

[Marvell1]

As far as I know, El Salvador is still positive for bitcoin, so whatever the op's perception is, I think it's just his story or his assessment. Because it seems to me that the op is spreading FUD.

This is just my opinion, that's why I said this. Because I believe that El Salvador knows what they're going to do about Bitcoin.
Then of course they're just balancing things out.

OP is not saying El Salvador is no longer bullish on bitcoin nor is he spreading Fud, what he says is valid and as NotATether has shown evidence. You can see details: https://news.bitcoin.com/el-salvador-complies-with-imf-requirements-bitcoin-legal-tender-status-withdrawn/


El Salvador's bullish stance on bitcoin remains the same but we need to understand that the country's economy is very important and should take priority over anything else. I believe they did not want to do this but they had no choice and it is the IMF that should be criticized instead of El Salvador.

[Cossyblack]

Source? otherwise you're just spreading FUDs.

It's true unfortunately: https://news.bitcoin.com/el-salvador-complies-with-imf-requirements-bitcoin-legal-tender-status-withdrawn/

The IMF man, they are such predators. They hold a lot of developing countries by the balls, and then they expect people to study in class why we have developed countries and developing countries and - get this - brainstorm what we can do about it.

Th answer: Nothing. Because these institutions will keep shaping economic policy in these countries just so that they can receive billions of dollars in aid loans from them.

The IMF are good at what they do,they offer huge amount of loan with an agenda to put you under their radar. El Salvador receiving this loans will give IMF the opportunity to start meddling into internal, economic and political affairs of the country.

[0t3p0t]

Source? otherwise you're just spreading FUDs.

From the article I get, El Salvador not withdrew the Bitcoin status from legal tender, they're still accept Bitcoin as legal tender, but they just didn't force merchants or El Salvadorian to use Bitcoin as legal tender.

According to the article I read, almost all people didn't use Bitcoin, so the impact is almost zero.

About 92 percent of Salvadorans did not use bitcoin in 2024, according to a survey by the Central American University.

Yeah and that is what I exactly understand when I read a news article back in 2024 about the IMF's pressure towards El Salvador's Bitcoin policies since they have the loan deal which is the requirement to secure it so yeah there is no such impact it can do to hurt the Bitcoin industry.

El Salvador has struck a $1.4bn (£1.1bn) loan deal with the International Monetary Fund (IMF) after agreeing to scale back its controversial bitcoin policies.

Link: https://www.bbc.com/news/articles/c20e3l3xllwo.amp

[SquirrelJulietGarden]

Yeah and that is what I exactly understand when I read a news article back in 2024 about the IMF's pressure towards El Salvador's Bitcoin policies since they have the loan deal which is the requirement to secure it so yeah there is no such impact it can do to hurt the Bitcoin industry.

El Salvador has struck a $1.4bn (£1.1bn) loan deal with the International Monetary Fund (IMF) after agreeing to scale back its controversial bitcoin policies.

Link: https://www.bbc.com/news/articles/c20e3l3xllwo.amp

El Salvador has a loan deal with IMF and they are under pressure to resolve their loan, with a loan repayment. It makes sense that IMF needs to get the loan repayment from El Salvador if the nation can do it. They will not like to see El Salvador to bet their national money to Bitcoin, while Bitcoin market is very volatile. El Salvador have very good profit with their bet and investment by DCA in Bitcoin recent years.

Now they are in great profit, so if they can use their profit to pay the loan for IMF, it's good for both sides. It's not similar to the end or cease of Bitcoin legal tender policy in El Salvador.
https://nayibtracker.com/

[Oluwa-btc]

After just over three years, El Salvador withdrew from Bitcoin the status of legal tender currency in the country president Nayib Bukele pushed the measure and became effective after the Salvadoran Legislative Assembly
And the question now is: will this impact the value of Bitcoin both instantly and in the long term?

I think is good in both ways but then how long does this tend to last, Bitcoin ceasing to become a legal tender in El Salvador, I believe it's a positive negotiations between the IMF and El Salvador. I can't really tell the fate of Bitcoin now and in the future but then such monetary policy usually amount to a greater impacts cause there would be much benefits for the both parties so then with time every thing will fall in place.

[Z-tight]

As far as I know, El Salvador is still positive for bitcoin, so whatever the op's perception is, I think it's just his story or his assessment. Because it seems to me that the op is spreading FUD.

Op is not spreading fud and it is not their perception, the story is true, check the internet for it. El Salvador has rescinded their policy of BTC being a legal tender in their country, they did that as a condition to receive a loan from the IMF. However, BTC is still legal in El Salvador, anybody can use it, any merchant can also decide to accept it, but all of that is now voluntary and no longer obligatory by law.

[AmoreJaz]

As far as I know, El Salvador is still positive for bitcoin, so whatever the op's perception is, I think it's just his story or his assessment. Because it seems to me that the op is spreading FUD.

Op is not spreading fud and it is not their perception, the story is true, check the internet for it. El Salvador has rescinded their policy of BTC being a legal tender in their country, they did that as a condition to receive a loan from the IMF. However, BTC is still legal in El Salvador, anybody can use it, any merchant can also decide to accept it, but all of that is now voluntary and no longer obligatory by law.

They are withdrawing btc as legal tender for financial aspect of things. Not because they don't want it as a means of payment. Just read the first reply from the OP's post and we can understand why such move. Though at first glance, it is like a sad news for the crypto community. Because everyone was like praising their move when they made btc as legal tender in their country. And now, because of some financial obligations, they need to retract such regulation.

Because for now, the important thing is to take a loan from IMF. And for sure, this is for the welfare of its people. Maybe, there are certain clauses from the IMF that they need to comply, and having btc as legal tender is not one of them. For me, the move is understandable because they have monetary concerns here and IMF can provide that need.

[nakamura12]

Even if El Salvador ceased to be the legal tender but it's not really all bad news since they are still using it as payment although as others have said that there might be some merchants that won't accept Bitcoin as a means of payment. El Salvador have to do it to get the loan since it's what IMF wanted or required. It's still legal though and it's not like they banned the use of bitcoin. I guess El Salvador is the first country to make bitcoin a legal tender and ceased as a legal tender.

[goldkingcoiner]

Seriously, IMF is subverting foreign powers just to get their way?

But I guess El Salvador really needed that loan. I think they will re-introduce BTC as legal tender in the future.

Not that I agree that this will have any kind of long term impact on Bitcoin. Because it will not.

[SquirrelJulietGarden]

Seriously, IMF is subverting foreign powers just to get their way?

IMF, WHO and other organizations can do things that related to politics, finance and more, but mostly for their benefits and main donators, sponsors for their operations. The severity of this abusement is only more or less, depends on organizations, pressure from donators/ sponsors and different times.

But I guess El Salvador really needed that loan. I think they will re-introduce BTC as legal tender in the future.

It's hardest to do anything, at personal or national scale for the first time, but for the second, third, later times, it will be more easily.

Not that I agree that this will have any kind of long term impact on Bitcoin. Because it will not.

I agree with you, El Salvador is a small nation, and they already finished its role in Bitcoin history as a first ever country made Bitcoin legal tender. It's historical role of El Salvador, and it helped Bitcoin to make noise, contributed to its adoption, and other countries have been continuing with Bitcoin legal tender and other kind of adoptions.

https://coinmarketcap.com/academy/article/el-salvador-becomes-first-country-in-the-world-to-adopt-bitcoin-as-legal-tender
https://coinmarketcap.com/legal-tender-countries/

[The Sceptical Chymist]

I've got a question here:  I've been reading Roger Ver's book Hijacking Bitcoin, and on pp.109 he states the following:

For example, when the El Salvador government announced that BTC was going to become an official currency, there was almost no mention of the fact that their government was setting up purely custodial wallets for their citizens--meaning, the government will be able to track and censor transactions made through their app, freeze accounts, or easily confiscate coins if they decide to.

Note: I haven't read through the other, very long thread on El Salvador, nor am I a huge fan of Ver's.  I'm just curious as to whether what he stated in the above quote is the truth, a falsehood, or in some kind of gray zone.  

BTW, that book is pretty interesting from a perspective of bitcoin history even if it is an unvarnished advertisement for BCH.