Key points

  • The IMF completed the second and third reviews of El Salvador's 40-month Extended Fund Facility, enabling an immediate $138 million disbursement.
  • The board granted waivers for missed performance criteria, including a limit connected to Bitcoin accumulation, based on corrective measures and renewed commitments.
  • The program calls for no further Bitcoin accumulation beyond documented donations and continued reduction of the state's role in crypto-related activity.

The International Monetary Fund has completed the second and third reviews of El Salvador's lending program, clearing an immediate disbursement of SDR 101.96 million, or about $138 million. The October 1 decision moves the 40-month Extended Fund Facility forward while keeping the government's Bitcoin activity under closer limits. The full arrangement, approved in February 2025, provides access to SDR 1.03 billion, roughly $1.4 billion.

Board accepts corrective measures

The IMF said El Salvador missed certain performance criteria, including a condition connected to Bitcoin accumulation. Its Executive Board granted waivers after considering corrective measures and renewed commitments from the authorities. Reuters independently reported that the approval followed a waiver for noncompliance with a restriction on additional Bitcoin accumulation. The outcome releases funding without treating the earlier breach as unresolved, but it also preserves tighter constraints on future public-sector activity. A waiver does not remove the underlying program condition; it allows the review to proceed after the lender assesses the size of the miss, the response and the safeguards proposed for later test dates.

Related reporting: Hegseth filing lists Bitcoin held through Coinbase

A narrower state role in Bitcoin

The policy shift is more consequential than the disbursement alone. The IMF said no further Bitcoin accumulation is expected beyond documented donations. It also cited the transfer of majority ownership and control of the government-backed Chivo wallet to a private operator as progress under the program. The government retains a minority interest, while the arrangement continues to push public institutions away from direct involvement in Bitcoin services and toward stronger oversight of crypto assets.

What the review says about the economy

The Fund described economic activity as stronger than expected, supported by improved security and investor confidence. It projected real gross domestic product growth of 4.5% in 2026 and said fiscal consolidation had advanced broadly in line with program goals. Reserve and liquidity targets were met comfortably, according to the review, while reforms have progressed in financial supervision, fiscal transparency, governance and measures against money laundering and terrorist financing. Those gains matter because the program is designed to improve fiscal sustainability and rebuild external buffers, not simply to govern cryptocurrency policy.

Reforms still carry execution risk

The review is not a clean bill of health. IMF officials said implementation challenges remain and called for decisive action to sustain the program. Priorities include rebuilding government liquidity buffers, improving public financial management and debt operations, and advancing delayed pension and civil-service reforms. The board's willingness to grant waivers indicates that it judged the corrective plan sufficient for now; continued access to financing will still depend on future performance and documentation. The Fund also emphasized contingency planning as global conditions remain uncertain, leaving the government with limited room for slippage in the next review cycle.

Why it matters for crypto policy

El Salvador made Bitcoin legal tender in 2021, but its framework has since been scaled back. Acceptance by private businesses is voluntary, taxes cannot be paid in Bitcoin, and the state's operating role is being reduced. The latest IMF decision therefore marks a transition from broad state promotion toward a more limited reserve-and-regulation model. The open question is whether transparency around donated Bitcoin and public-sector holdings will improve enough to satisfy later reviews without further waivers.

Sources

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