Source: Cointelegraph
Original: “Lessons from El Salvador's Failed Bitcoin Experiment”
Views from: Kadan Stadelmann, Chief Technology Officer of the Komodo platform
The International Monetary Fund (IMF) wants to suppress you. Just look at El Salvador, where President Nayib Bukele has abandoned the Bitcoin (BTC) legal tender revolution in favor of international development loans. The new status quo is clear: while the country can accumulate and hold Bitcoin, the people cannot use it as legal tender. Instead, they must continue to rely on fiat currency.
The IMF, as a financial institution of the United Nations, has long played a significant role in economically colonizing emerging countries on behalf of multinational corporations, banks, and the U.S. government.
The way the IMF operates is by providing development loans for construction and engineering projects in developing countries. To obtain these loans, countries typically agree to balance their fiscal deficits, cut public spending, open markets, and privatize economic sectors. For El Salvador, this also included stifling the Bitcoin revolution and suppressing dissent—Bitcoin supporters. This is known as "conditionality."
IMF states: Ban on the use of Bitcoin
In 2021, El Salvador became the first country in the world to adopt Bitcoin as legal tender. President Bukele stated that he introduced Bitcoin as legal tender to free the Salvadoran people from the shackles of the central bank.
However, he also noted that the acceptance of Bitcoin on the streets of El Salvador has been slow. Bukele pointed out that this was the least popular measure taken by his government. According to a survey by Francisco Gavidia University in San Salvador, about 92% of Salvadorans had not used Bitcoin by 2023.
The revolution seems to be dead. El Salvador has been forced to scale back its Bitcoin agenda in order to attract development funds from the IMF and quickly retract the legal framework supporting Bitcoin. To secure a $1.4 billion credit line, Bukele chose to do what the IMF demanded: withdraw the plan to use Bitcoin as national currency. The IMF stated this was to mitigate risks associated with Bitcoin.
The development agency forced the Salvadoran government to reduce Bitcoin purchases and no longer accept Bitcoin as a method of tax payment. Bukele also repealed the law requiring businesses to accept Bitcoin. Meanwhile, the IMF stated that public sector activities related to Bitcoin would be restricted.
The Central American country will also gradually reduce its collaboration with Chivo, the Bitcoin e-wallet launched by El Salvador in 2021. The plan is to privatize or shut down Chivo. It is unclear how many people are using this digital wallet.
In 2021, the Salvadoran government spent $200 million on building Bitcoin infrastructure, including Chivo and Bitcoin ATMs. It also provided $30 in free Bitcoin to those who registered to use the wallet. Most people used Bitcoin to purchase goods or exchanged it for U.S. dollars.
Despite the changes in El Salvador's Bitcoin strategy, the government claims it remains committed to Bitcoin. It can still accumulate Bitcoin—look at the recent purchase of 12 Bitcoins. Stacy Herbert, director of the National Bitcoin Office of El Salvador, stated that El Salvador will continue to buy Bitcoin to build its Bitcoin reserve strategy. El Salvador will no longer prioritize putting Bitcoin into the hands of the people. The country continues to build its Bitcoin reserves, but the experiment of using it as legal tender seems to be over.
IMF and Bitcoin
The Salvadoran government adopted Bitcoin as legal tender to allow ordinary citizens to enjoy the benefits of cryptocurrency. They could experience the feeling of holding a robust asset. People could also begin to understand the various drawbacks that central banks bring to society.
The IMF disagrees. It has consistently sought to reduce opportunities for people to discover how robust assets can change the lives of low-income and disenfranchised people.
The IMF stated: “For the public sector, economic activities related to Bitcoin and the purchase and trading of Bitcoin will be restricted. Transparency, regulation, and oversight of digital assets will be strengthened to safeguard financial stability, consumer and investor protection, and financial integrity.”
When El Salvador adopted Bitcoin as legal tender in September 2021, the IMF warned of financial and legal risks, but the IMF recently stated that these risks have not materialized.
Bukele's Deal with the "Devil"
It is not new for the IMF to take away tools of financial liberation from the people. Its dominance over resource-poor countries has been a consistent theme in the post-World War II world.
In 2024, the IMF's colonial practices faced massive protests in Kenya, revealing the predatory nature of the IMF.
The protests called for Kenyan President William Ruto to withdraw the austerity and tax bills led by the IMF.
This is just another example of American colonial power prioritizing U.S. interests at the expense of the people in impoverished countries. In Kenya and many other countries, the IMF continues to push austerity measures, often freezing public sector bills.
“This global financial system was not built by us, nor for us, so it cannot be the financial architecture that helps us today. This is the new colonialism of wealth extraction,” said Tunisian-American economist Fadhel Kaboub in an interview outside the IMF counter-summit in Marrakech, Morocco.
Despite the African people's uprising against the IMF's colonial behavior and debt control this year, Bukele has yielded.
As a department of the United Nations, the IMF aims to unify economic policies globally and maintain the dominance of fiat currency. Countries can accumulate Bitcoin, but IMF development assistance must be predicated on the country abandoning any idea of using Bitcoin as legal tender. This is the lesson from El Salvador.
Views from: Kadan Stadelmann, Chief Technology Officer of the Komodo platform
Related: Standardization is Crucial for Cryptocurrency Adoption
This article is for general informational purposes only and is not intended and should not be construed as legal or investment advice. The views, thoughts, and opinions expressed in this article are solely those of the author and do not necessarily reflect or represent the views and positions of Cointelegraph.
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
