The first nation to legalise bitcoin has unrealized losses of almost $20 million, or a 23 per cent loss on its BTC investments.
El Salvador’s bitcoin experiment started less than a year ago. Thus far, though, it has not gone as well as the tiny Central American country had anticipated, at least in terms of bitcoin investments.
It’s fair to say that El Salvador and its President Nayib Bukele stunned the globe in June when they declared their intention to become the first government to embrace Bitcoin as legal cash.
Three months later, El Salvador passed the Act, which drew criticism from international financial institutions such as the IMF and the Bank of England.
While Bukele ironically ignored the criticism, the country continues to interact with bitcoin and the community in a number of important ways. These included proposals to establish Bitcoin-themed schools, cryptocurrency mining utilising the country’s volcanic energy, and, perhaps most significantly, ambitions to build a Bitcoin City.
Among all of these steps, the nation began often purchasing pieces of the asset. It has made nine such acquisitions thus far, as Bukele noted on Twitter. The most recent one arrived a few days ago, valued at $15 million.
Prior to then, the country had spent $70,561,800 on its Bitcoin holdings. This means that El Salvador has now allocated approximately $85,600,000 in bitcoin as part of its latest cash injection.
Spending over $85 million in less than six months on a volatile commodity like bitcoin is dangerous in and of itself. Purchasing ahead of the $69,000 price top and then witnessing a 50% pullback will surely put pressure on Bukele’s administration.
BTC reached the aforementioned ATH in mid-November but then began a downward trajectory over the next few months. The most recent retracement occurred during the last several days, with BTC falling over $10,000 to its lowest level since before El Salvador adopted cryptocurrencies.
Bitcoin is currently trading at around $36,500, following a $3,500 surge over the last 24 hours. Nonetheless, El Salvador’s BTC investment is now down by more than 23%. This is because the total value of the 1,801 coins is now little less than $66 million.
Bukele, on the other hand, seemed unfazed, joking on Twitter about a new employment at McDonald’s. He even had some harsh remarks yesterday for non-believers.
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