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According to a publication released on Tuesday by the International Monetary Fund (IMF), the organization has urged El Salvador should end its relationship with Bitcoin (BTC). The IMF urged the Central American nation to expunge the Bitcoin law as soon as possible.

The report detailed that IMF board members have “urged the authorities to narrow the scope of the Bitcoin law by removing bitcoin’s legal tender status.” The news comes two weeks after a blog post published by IMF economists stressed: “[cryptocurrencies] could soon pose risks to financial stability especially in countries with widespread crypto adoption.”

The report also revealed that some IMF members have “expressed concern over the risks associated with issuing bitcoin-backed bonds.” In the first week of January 2022, the Salvadoran government introduced 20 bills to develop a legal framework for its upcoming Bitcoin bonds.

However, El Salvador has remained unshaken in its commitment to integrating BTC into its economy, with President Nayib Bukele revealing that a Bitcoin mining facility powered by volcanic energy could be ready by the end of September. Some days ago, the Bitcoin-loving President explained that his country was making investments to help bolster its geothermal energy production.

El Salvador Remains Steadfast in Bitcoin Plans Despite IMF Warnings

Bukele has announced several BTC purchases onto the country’s balance sheet, with the most recent announcement coming last week. The President said the country purchased 410 BTC last Friday, following the massive crash, bringing its total holding to 1,801 BTC.

Apart from its criticisms of the Bitcoin legal tender law and Bitcoin-backed bonds, the IMF also criticized the Chivo wallet adopted by the country. The report stated:

“Directors agreed on the importance of boosting financial inclusion and noted that digital means of payment—such as the Chivo e-wallet—could play this role.”

“However, they emphasized the need for strict regulation and oversight of the new ecosystem of Chivo and Bitcoin.”