The International Monetary Fund (IMF) has called on El Salvador to stop accepting Bitcoin as legal tender.
The fund "urged [the Central American country] to narrow the scope of the Bitcoin law by removing Bitcoin’s legal tender status,” an IMF press release published today said.
The IMF argued El Salvador’s Bitcoin-backed bonds announced in November 2021 carry significant risk, while worries surrounding stability, consumer protection, and integrity means urgent regulation is required.
This advice follows a visit to the country from an IMFeconomic team to assess the health of the country’s economy.
The IMF had suggested Bitcoin should not be used as legal tender in El Salvador just after the country adopted it, cryptobriefing.com said.
The country, which had a population of 6.5mln in 2020, has roughly 1,801 Bitcoins, valued at US$65.3mln, some 30% downside on its value at purchase, the crypto website added.
El Salvador opened volcano-powered Bitcoin mining facilities in the latter months of last year and is planning a so-called ‘Bitcoin City.’