El Salvador’s decision to make Bitcoin legal tender has not yet proven to be a risk, according to the International Monetary Fund (IMF). However, the agency warns that it’s important to remain vigilant, as the situation in El Salvador requires transparency and attention.
The IMF has had a strained relationship with El Salvador since last year, when it urged the country to abandon its Bitcoin plans. Despite this, El Salvador has continued with its agenda, although it has suffered from the sudden drop in Bitcoin’s price.
The IMF predicts that tokenized bonds based on Bitcoin could emerge in the coming months, given the country’s strict use of the cryptocurrency. The IMF plans to keep a close eye on the country’s Bitcoin behavior and the use of cryptocurrencies, but also praised El Salvador for its economic growth.
However, the organization expressed concern about the country’s increasing account deficit and the potential spillover due to the rising fears of a recession in the U.S. It also emphasized the importance of transparency in the government’s Bitcoin transactions and the financial state of the state-owned Bitcoin wallet.