El Salvador, the first country to make Bitcoin legal tender, is going through a difficult regulatory period, which has resulted in changes to its cryptocurrency laws to comply with the terms of a loan agreement reached with the International Monetary Fund (IMF).

Jan3 CEO Samson Mow noted that Bitcoin’s status in El Salvador is complex and ambiguous: “Bitcoin is and is not legal tender,” he said in a post on February 13. Mow, an advocate for national adoption of Bitcoin, described the situation with Bitcoin in El Salvador as a “glass half full” situation.

It is important to note that the IMF, an international organization operating under the UN, has opposed El Salvador’s Bitcoin experiment from the start, repeatedly warning of the risks to financial stability.

In December 2024, the IMF agreed to a $1.4 billion deal with the government of El Salvador, offering a loan in exchange for reducing the country's Bitcoin adoption rate. In accordance with this agreement, El Salvador's legislature approved amendments to the Bitcoin law, which went into effect at the end of January 2025.

It is also important to note that the amendments to the Bitcoin law prohibit the country's government from "touching BTC." However, as Mou emphasizes, much will depend on how the term "restriction" is interpreted. He convincingly noted: "Political parties come and go. Laws can change, so the real process of Bitcoin adoption is important; the goal is for people to understand how to use Bitcoin."