The International Monetary Fund (IMF) has lauded El Salvador for sustaining strong economic growth, citing expanding output and improving macroeconomic conditions.
In a press release, the IMF noted that El Salvador’s economic performance has exceeded expectations, supported by improved investor confidence, record remittance inflows, and strong investment activity.
“The economy is expanding at a faster than anticipated pace on the back of improved confidence, record remittances, and buoyant investment. Real GDP growth is projected to reach around 4 percent this year and with very good prospects for next year”, it wrote.
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Reports reveal that the Salvadoran economy grew 5.1% in the third quarter of 2025, consolidating its upward trajectory after having grown 2.4% and 4.1% in the first and second quarters, respectively.
This growth was driven by factors such as: Safety conditions in the country, strength of the financial sector, boom in public and private investment in construction, among others.
In 2022, the IMF had urged El Salvador to abandon Bitcoin as a legal means of payment, saying the cryptocurrency could pose risks to national financial stability, consumer protection, and the ability to receive loans.
Despite these concerns, President Nayib Bukele’s administration made it clear that Bitcoin’s legal tender status was not up for negotiation. Government officials maintained that Bitcoin remains central to El Salvador’s long-term vision for financial innovation, inclusion, and economic sovereignty.
The recent commendation by the IMF comes as it continues to work closely with President Nayib Bukele’s administration under the Extended Fund Facility (EFF) program, approved earlier this year for $1.4 billion.
As part of the EFF agreement, El Salvador committed to halting its official Bitcoin accumulation strategy. The government also agreed to sell its state-run Chivo wallet infrastructure and allow the private sector to operate freely with Bitcoin, which remains legal tender in the country.
“Negotiations for the sale of the government e-wallet Chivo are well advanced, and discussions with regard to the Bitcoin project continue, centered on enhancing transparency, safeguarding public resources, and mitigating risks,” the IMF stated in its report.
The IMF also highlighted the government’s continued commitment to fiscal consolidation. It noted that El Salvador remains on track to meet its end-2025 primary balance target, while the recently approved 2026 budget aligns with further deficit reduction alongside increased social spending. These fiscal efforts, the IMF said, are helping to boost foreign reserves and reduce domestic borrowing in line with program targets.
Beyond near-term fiscal measures, the Fund pointed to progress on key structural reforms aimed at strengthening the country’s economic foundations. The Fund concluded by reaffirming its commitment to continued close engagement with Salvadoran authorities.
According to the IMF, discussions will continue in the coming period with the goal of reaching an agreement on all remaining policies and reforms required to complete the second review of the EFF program
Despite these commitments, blockchain analytics firm Arkham reports that El Salvador has continued its daily Bitcoin purchases. On-chain data indicates that the country’s Bitcoin holdings have grown to approximately 7,508 BTC at press time, suggesting ongoing accumulation despite IMF restrictions.
Background Story
El Salvador made history in September 2021 by becoming the first country in the world to adopt Bitcoin as legal tender. The landmark policy took effect on September 7, 2021, positioning the Central American nation at the center of the global cryptocurrency debate.
The move followed the passage of the Bitcoin Law by El Salvador’s Legislative Assembly on June 9, 2021. The law was approved with a strong majority and signed by President Nayib Bukele, who championed Bitcoin as a tool for financial inclusion, innovation, and economic independence.
Under the legislation, Bitcoin became legal tender alongside the U.S. dollar, which El Salvador has used as its official currency since 2001. The law required businesses to accept Bitcoin as a form of payment, except in cases where technological limitations made it impractical. To support adoption, the government launched the Chivo digital wallet, offering incentives to encourage citizens to use Bitcoin for everyday transactions.
President Bukele argued that Bitcoin adoption would lower remittance costs, expand access to financial services for the unbanked population, and attract foreign investment. However, the decision also drew criticism from international financial institutions, including the International Monetary Fund (IMF), which raised concerns about financial stability, fiscal risks, and consumer protection.
Since its adoption, El Salvador’s Bitcoin policy has remained a defining feature of its economic strategy, sparking both global interest and controversy.
Market Impact
Since the adoption of Bitcoin as a legal tender, the crypto asset has had measurable effects on the country’s economy, financial inclusion, and investment climate.
Remittances have long been a critical pillar of El Salvador’s economy, accounting for nearly 24% of GDP. With Bitcoin. Reports show that remittance flows surged by over 10% after the introduction of Bitcoin, saving recipients millions in transfer costs compared to traditional channels.
Also, the government’s Chivo wallet, a state-backed digital platform, has helped integrate previously unbanked populations into the financial system. As of late 2025, over 3.5 million Salvadorans, roughly 50% of the adult population, actively use the Chivo wallet for payments, savings, and Bitcoin transactions. This increased access to financial services has facilitated micro-business growth and everyday transactions.
Notably, El Salvador’s Bitcoin-friendly policies have drawn tech entrepreneurs, blockchain startups, and international investors. Several Bitcoin conferences and business ventures have been hosted in the country, providing a boost to tourism revenue and creating new job opportunities. According to local reports, foreign direct investment in technology sectors rose by 15% in the two years following adoption
El Salvador’s continued support for Bitcoin has reinforced a bullish macro outlook around the asset. President Bukele has also maintained close ties with U.S. President Donald Trump, a relationship that has further amplified attention on the country’s Bitcoin adoption strategy.
Outlook
With Bitcoin’s fixed supply and increasing global demand, market observers suggest the cryptocurrency could track the long-term performance of traditional stores of value such as gold and silver.
In this context, El Salvador is increasingly viewed as being strategically positioned to benefit from potential Bitcoin price appreciation, which could strengthen its fiscal position and support public debt obligations over time.