IMF Clears $138 Million El Salvador Payout After Bitcoin (BTC) Criterion Miss Waived

IMF Board Clears $138 Million Payout

The International Monetary Fund's Executive Board completed the second and third reviews of El Salvador's Extended Fund Facility on Thursday, October 1, and approved an immediate disbursement of SDR 101.96 million, roughly $138 million. The review turned on Bitcoin (BTC): one of the program's performance criteria, the numerical benchmarks El Salvador must meet to keep funding flowing, covered the country's accumulation of bitcoin, and the authorities missed it. The Fund granted a waiver for the miss, citing strong corrective action and a renewed commitment to program objectives, so the cash was released the same day the decision cleared. A waiver, in the Fund's machinery, is the device that lets a review close and money move even when a stated target has been missed. Under the facility's design, missed criteria normally freeze disbursements until corrected, which is why the waiver decision carried the payout itself. The 40-month EFF was approved on February 26, 2025, with a total envelope of about $1.4 billion. Staff-level agreement on its terms dates to December 18, 2024, and those terms leaned directly on the state's bitcoin habit. El Salvador amended its Bitcoin law in January 2025 to make merchant acceptance voluntary, and public-sector Bitcoin (BTC) transactions and purchases were restricted as a loan condition. The first review closed in June 2025. By September 3, 2025, when Fund staff announced a fresh agreement with San Salvador, submitted documentation had confirmed that all bitcoin added to national holdings after that first review came from private donations, with no public money spent. Bitcoin activity sits alongside governance and fiscal targets as a loan condition, an unusual placement that made El Salvador a test case for how the Fund handles a sovereign crypto holder. For markets, the deal settles a question that has hung over the Bitcoin (BTC) price narrative all year: whether a sitting government would keep buying.

Chivo Handover and the End of State Buying

Beyond the payout, the board's statement laid out how El Salvador's state role in bitcoin is being dismantled. The Fund confirmed that no further accumulation is planned beyond donations that are documented in writing. The government's flagship wallet, Chivo, has passed majority ownership and management control to a private operator, a step the review welcomed; when staff announced the September agreement, the state still held a minority stake and custodial responsibility for customer assets, and the Fund now wants that residual exposure fully resolved. Two priorities follow from the document: stronger disclosure of the crypto holdings still carried on public-sector balance sheets, and amendments to the country's digital asset issuance law to bring issuer regulation up to standard. Talks to sell Chivo had already advanced significantly, the Fund said in a December 22, 2025 statement, with the focus on transparency, protection of public resources and risk reduction. First Deputy Managing Director Dan Katz, who chaired the board, said state involvement in Bitcoin-related activities is being wound down, and pressed San Salvador to deliver the pension and civil service reforms still outstanding. The macro backdrop is not the constraint: real GDP growth is projected to accelerate from 3.9 percent in 2025 to 4.5 percent in 2026, supported by improved security and returning investor confidence, while foreign reserves are on track to reach $5.346 billion this year and reserve and liquidity targets were met with margin. The path was not linear. In April 2025 the government signaled it intended to keep adding to its holdings, and a July 2025 Fund report attributed growth in the country's Strategic Bitcoin Reserve to consolidation of assets across multiple government-owned wallets rather than fresh purchases. Authorities have agreed to publish the staff report behind the review.

A Sovereign Buyer Steps Back

In our read of the official review statement, the waiver is less a concession than a closing entry: it formalizes the end of sovereign Bitcoin (BTC) accumulation under a Fund program, the first time a national Strategic Bitcoin Reserve has been capped by conditionality rather than by choice. El Salvador, a country that once wore its bitcoin maximalism as national policy, now holds what it holds and plans to add nothing except documented gifts. With marginal demand set elsewhere, by ETF flows that carried $2.65 billion in September inflows into bitcoin funds, removing a small state buyer reads more as fiscal housekeeping than market event. The template travels: any state still accumulating should register that the $138 million moved only after the buying stopped.