El Salvador is just taking advantage of certain conditions in the loan agreement that were ambiguous or perhaps flexible. Somehow, the country is able to skirt the condition that prohibited its public sector to further purchase Bitcoin.
As I'm interested how exactly El Salvador does this, I googled around a bit (AIs weren't helpful in this case).
I found
this Spanish article which lists several ways the government can buy Bitcoin without using taxpayers' money, citing an
X thread by "Bitcoin Beach":
1) Transaction fees and "
donations" which could go to the Bitcoin Office. I guess they refer to fees in Chivo (the article unfortunately isn't that clear here, and the X thread also doesn't help, instead confusing me more - it mentions help by the US government ...).
Yeah, '
donations' in the same way as when one is '
volenteered' for doing some task. A friend of mine '
donated' about $1k or so before he gave up on using vendors who used Chivo's payment platform service. Or more accurately, went crawling back to Visa/Mastercard.
I don't want to piss in anyone's cheerios, but it's not hard to understand why uptake of Bitcoin remained low. That said, more people are more aware and more interested in the concept of a deflationary currency and self-custody. Things may be moving under the surface, and exposure to people who have done well with the asset class year after years is mostly a positive thing. This is even more the case as legacy banks become less and less functional and performant due to the demands that they perform monetary surveillance and enforcement roles.
2) Mining. The government could support private mining facilities in the country, which as a compensation would return Bitcoins to the Bukele government. Unfortunately the article is also not detailed here, but I guess this "support" could be done for example with tax exemptions.
3) Adquisitions by the private sector. This would be a similar "loop", e.g. the government "supporting" companies (e.g. via tax exemptions) and these companies also would transfer the coins to the government's or the Bitcoin Office's wallets.
4) Maintain a certain opaque element as to exactly who owns what, how and where it came from, and how and to whom it might be distributed in the event of what set of events. Allow people to decide the answers to these questions for themselves based on what makes them feel good, and gently 'nudge' them in a favorable direction by use of social media influences. 'People' would include IMF people, although they do have their hands on the spigot. Supposedly.
