El Salvador Made Bitcoin an Official Currency. Now It’s Backtracking for IMF Loan.

The government of El Salvador’s President Nayib Bukele agreed to scale back his ambitious plan to adopt bitcoin as a national currency in exchange for a much-needed $1.4 billion loan by the International Monetary Fund.

The IMF said in a statement Wednesday that in exchange for the financial-aid program to support the Bukele administration economic overhaul agenda, the government agreed to implement measures to mitigate bitcoin-related risks.

The deal signals an important shift by the IMF, showing greater flexibility over government use and regulation of bitcoin in anticipation of friendlier crypto policies by the incoming administration of President-elect Donald Trump , said Alejandro Werner , a former director of the IMF’s Western Hemisphere Department.

Bukele’s surprise decision to make bitcoin legal tender was cheered by crypto enthusiasts but stalled financial support from the IMF in the midst of concern that the volatile crypto asset could rock the finances of the impoverished and indebted Central American nation.

“In a situation where the international financial community didn’t want to set a precedent on the adoption of bitcoin as legal tender, it became an obstacle to close an agreement with the IMF,” said Werner, who also served as adviser to El Salvador’s government and currently heads the Georgetown Americas Institute in Washington, D.C.

The use of bitcoin as a national currency in this country of around 6.5 million didn’t take off, surveys show. After the government spent more than $200 million in 2021 rolling out bitcoin ATMs and an e-wallet with $30 of free bitcoin for anyone who signed up, most users took the virtual currency to buy goods or exchange it for dollars.

The government began purchasing bitcoin when it was trading at about $30,000, booking losses at first and then posting significant gains as its volatile price surpassed $100,000 recently.

Among the concessions made by the Bukele administration, acceptance of bitcoin by the country’s businesses will no longer be mandatory, while the public sector’s participation in bitcoin-related activities will be restricted, the IMF said.

“The potential risks of the bitcoin project will be diminished significantly” in line with fund policies, the IMF said.

Under the agreement, El Salvador’s government agreed to reduce bitcoin purchases, and it will no longer accept tax payments with the crypto asset. The government’s participation in Chivo, the crypto e-wallet launched in 2021, will be gradually unwound, the IMF said.

“Transparency, regulation, and supervision of digital assets will be enhanced to safeguard financial stability, consumer and investor protection, and financial integrity,” it added.

Bukele highlighted on X the IMF’s remarks about the steady expansion of the country’s economy since the pandemic, bolstered by “robust remittances and a remarkable pickup in tourism,” in the midst of improvements in public security.

For many Australians, the 2026 Federal Budget initially felt like a direct challenge to the way wealth is created, held and transferred between generations.

The headlines were immediate: changes to capital gains tax, reforms to discretionary trusts, restrictions on negative gearing and increased scrutiny of investment structures. Unsurprisingly, affluent families, business owners and investors began asking the same question:

Is the way we hold our wealth still fit for purpose?

In recent days, the government has announced several significant amendments following industry consultation and public feedback, including exempting testamentary trusts from the proposed 30 per cent minimum tax and expanding capital gains tax concessions for small businesses.

The backdown is welcome. But it also highlights something much bigger.

This Budget has accelerated a conversation that many Australian families have been postponing for years.

The conversation is not really about tax. It is about wealth stewardship.

For decades, Australians have built wealth through businesses, property, investments and careful long-term planning. Yet many families have not revisited the legal structures surrounding those assets in years, sometimes decades.

We often see clients who have spent years building significant wealth, only to discover their legal arrangements no longer reflect their current circumstances.

Their children are now adults. They may own multiple properties.

They may have sold a business, entered a second marriage, become grandparents or accumulated digital assets that did not exist when their original estate plans were prepared.

The trust that distributes income may need to be reconsidered. The bucket company may no longer be so attractive.

The Budget has simply exposed a reality that already existed: wealth structures cannot remain static while life continues to evolve.

Importantly, trusts themselves are not the issue.

Trusts are legitimate planning tools that provide flexibility, protection and continuity. When used appropriately, they allow families to adapt to changing circumstances over time.

And neither is tax the issue, really. Getting the fundamentals right is more important for long-term, sustainable wealth than a few favourable tax treatments around the edges.

The real issue is complacency.

Too often, families create structures and assume the job is done. It isn’t.

Estate planning is no longer a document you sign once and file away in a drawer. It is an ongoing process that should evolve alongside your life.

We are also seeing a broader shift in how Australians define wealth itself. It is no longer just the family home and an investment portfolio.

Modern wealth includes businesses, digital assets, cryptocurrency, intellectual property, frequent flyer points and increasingly complex family arrangements.

At the same time, Australians are living longer than ever before, meaning wealth may need to support multiple generations simultaneously. This creates new responsibilities and new risks.

How do you help your children enter the property market without exposing family wealth to relationship breakdowns?

How do you structure wealth so that it remains a source of opportunity rather than future conflict?

These are the questions families should be asking now.

The recent debate surrounding testamentary trusts also serves as an important reminder that policy decisions can have unintended consequences for vulnerable Australians. It is encouraging that the government has listened to feedback and clarified its position.

But the lesson remains: the wealth landscape is changing.

Increasingly, governments, regulators and tax authorities are paying closer attention to how wealth is held and transferred. That means families cannot afford to adopt a “set-and-forget” approach to their structures.

The families who will be best placed for the future are not necessarily those with the greatest wealth.

They are the families with the greatest clarity. Clarity around ownership, succession and governance. And clarity around how wealth will transition from one generation to the next.

Ultimately, preserving wealth is not about avoiding change.

It is about preparing for it.

Because the greatest risk is not change itself.

It is losing the ability to respond to it.

Anthony Hunt is Co-Founder of Wealth Lawyers and former COO of Westpac Private Bank. He advises business owners, investors and affluent Australian families on wealth protection, succession planning and intergenerational wealth transfer

El Salvador Made Bitcoin an Official Currency. Now It’s Backtracking for IMF Loan.

Organization is showing flexibility by allowing the bitcoin program to proceed in a limited way

The Federal Budget may have softened some of its proposed tax reforms, but it has exposed a bigger issue: too many families are relying on wealth structures that no longer reflect the realities of modern life.