El Salvador holds approximately 7,706 BTC valued at $474 million as of July 2026, ranking fifth among sovereign Bitcoin holders globally. The country secured a $1.4 billion IMF Extended Fund Facility in December 2024, agreeing to confine public-sector Bitcoin purchases and make merchant acceptance voluntary, yet its National Bitcoin Office continued announcing daily BTC acquisitions through mid-2026. Bitcoin was formally rescinded as legal tender in February 2025 through a legislative amendment, though the government maintained its strategic reserve accumulation policy without interruption. The IMF attributed the rise in on-chain balances to wallet consolidation rather than new purchases, creating a managed ambiguity between loan conditions and treasury activity that both parties have found politically convenient to maintain.
El Salvador Adopted Bitcoin as Legal Tender in September 2021
President Nayib Bukele championed the Bitcoin Law, which the Legislative Assembly passed on June 9, 2021. The law granted Bitcoin legal tender status alongside the U.S. dollar and obliged businesses to accept it as payment. The government launched the Chivo wallet, offering a $30 incentive to encourage adoption. By late 2022, Bukele announced a policy of purchasing one Bitcoin per day, creating a systematic dollar-cost averaging approach to treasury building, as documented by CoinDesk reporting.
Public adoption remained limited throughout. A poll by the Universidad Centroamericana published in January 2025 found that 92 percent of Salvadorans did not use BTC in 2024. Usage declined from 25.7 percent in 2021 to 8.1 percent in 2024, according to the Instituto Universitario de Opinion Publica. The gap between government enthusiasm and citizen adoption became a central argument for the IMF in loan negotiations.
El Salvador's Bitcoin strategy functioned less as a medium-of-exchange project and more as a sovereign wealth accumulation play. The distinction matters because the government's unrealized gains depend entirely on BTC price appreciation, not on domestic transaction volume. At an estimated average acquisition price of approximately $45,200 per coin, the treasury sat in profit through mid-2026, though a sustained price decline below that level would reverse the narrative entirely.
IMF Extended Fund Facility Imposed Bitcoin Purchase Restrictions in December 2024
In December 2024, El Salvador and the IMF reached a staff-level agreement on a 40-month Extended Fund Facility worth approximately $1.4 billion, with the broader multilateral package exceeding $3.5 billion when World Bank, IDB, and CAF contributions were included. The IMF's December 18, 2024 press release stated that the program would diminish Bitcoin-related risks significantly.
The agreement imposed two hard limits: no voluntary BTC accumulation by the public sector and no public-sector BTC-denominated debt or tokenized instruments. Legal reforms made merchant acceptance voluntary. Taxes became payable only in U.S. dollars. The government agreed to wind down the Chivo wallet. The IMF board approved the arrangement on February 26, 2025, disbursing approximately $113 million immediately.
Yet the on-chain record tells a different story. The National Bitcoin Office (ONBTC) continued announcing purchases after the agreement. The reserve grew from approximately 5,968 BTC at the December 2024 formalization to over 7,700 BTC by mid-2026. IMF spokesperson Julie Kozack addressed the discrepancy in July 2025, stating that apparent increases reflected movements across government-owned wallets rather than net new purchases, as reported by 99Bitcoins' analysis.
President Bukele publicly rejected the notion that accumulation would stop. He posted on X on March 4, 2025: the policy would continue regardless of external pressure. Stacy Herbert, director of the National Bitcoin Office, stated that El Salvador would continue buying Bitcoin at possibly an accelerated pace.
El Salvador Channels Geothermal Energy into Bitcoin Mining Operations
El Salvador's Bitcoin strategy extended beyond market purchases. The government channeled proceeds from the Volcano Bond, a Bitcoin-backed bond instrument issued in late 2024, into geothermal mining infrastructure at the Conchagua volcano. Approximately 474 BTC have been attributed to public mining operations since the facility began operating. Officials began describing El Salvador as the Green Battery of Central America, positioning geothermal energy as a dual-use resource for both Bitcoin mining and AI data centers.
The country's central bank also diversified into gold, adding $50 million in reserves in January 2026 alone, bringing total gold holdings to approximately $360 million across 67,403 troy ounces. This parallel accumulation strategy suggests that Bitcoin occupies one position within a broader alternative-asset framework rather than serving as the sole treasury diversification tool.
The geothermal angle gives El Salvador a narrative advantage that pure market purchasers lack. Mining BTC with renewable energy sources creates a sustainability story that partially offsets criticism about Bitcoin's environmental impact. It also provides a technical argument for the IMF wallet-consolidation explanation: mined coins entering government wallets would register as increases on public trackers without constituting market purchases.
IMF Reviews Will Scrutinize On-Chain Balance Reconciliation
The IMF's second review of the Extended Fund Facility will scrutinize whether El Salvador's rising on-chain balances can continue to be reconciled with the no-accumulation commitment. The next review is expected before year-end 2026. If future reviews produce inconsistent pictures between public trackers, government statements, and IMF assessments, disbursements from the $1.4 billion facility could face delays. The precedent matters globally as other nations evaluate sovereign Bitcoin frameworks under multilateral oversight.
FAQ
How much Bitcoin does El Salvador currently hold in its national treasury?
El Salvador holds approximately 7,706 BTC valued at roughly $474 million as of July 2026, according to BitcoinTreasuries.net government tracking data.
When did El Salvador first adopt Bitcoin as legal tender?
El Salvador's Legislative Assembly passed the Bitcoin Law on June 9, 2021, making it the first country to grant Bitcoin legal tender status alongside the dollar.
Is Bitcoin still legal tender in El Salvador after the IMF deal?
Bitcoin was formally rescinded as legal tender in February 2025 through a legislative amendment, though the government maintains its strategic Bitcoin reserve accumulation policy.
