El Salvador Buys The Bitcoin Dip

May 10, 2022 2:50 pm

The country of El Salvador just announced that it has added another $15.5 million worth of Bitcoin (500 BTC)  to its balance sheet which indicates that the country is taking full advantage of the recent dip in the crypto markets.

El Salvador first started adding Bitcoin to its balance sheet during the same month where it announced that it would adopt Bitcoin as legal tender which was September of last year.

So far, it has been recorded that Bitcoin has dropped around 8% in just the last 24 hours and is currently priced at around $31,000 which makes it about half the price of its all time highs at around $60k.

Right now, the country holds a total of 2300 Bitcoin which is currently valued at about $71 million and the country’s president, Nayib Bukele, remains a strong advocate of the use of the digital asset.

CNBC reports:

El Salvador purchased bitcoin at an average price of $30,744, according to the president’s tweet.

The country’s total reserve is up to 2,301 bitcoin, or about $71.7 million at current prices, based on data tracked by Bloomberg.

This is the latest in a string of dip buys over the last nine months, in which President Bukele — who has tethered his political fate to the success of the country’s bitcoin experiment — has doubled down on his bitcoin bet, as the crypto market plummets.

The country’s decision to lean into bitcoin is not without its skeptics — a contingent that has been gaining momentum in recent months.

For months, the International Monetary Fund has bemoaned Bukele’s bitcoin experiment.

In particular, the IMF has been the strongest critic of El Salvador’s push to adopt Bitcoin where it stressed that it was concerned about financial impact and exposure to risk it would have on the nation.

As a result, the organization has already urged El Salvador multiple times to consider removing Bitcoin as an option for legal tender, especially when the country started to develop plans to offer Bitcoin-backed bonds.

With that being said, the country has disagreed with that view point and has continued to accelerate the use of digital assets within its economy.

Recent reports show that around 20% of businesses within the country are already accepting Bitcoin as a payment option which indicates that adoption is steadily growing.

Bitcoinist reports:

Despite warnings from the International Monetary Fund about the risks of adopting Bitcoin legal tender, the Central American country has purchased Bitcoin on many times, taking advantage of price drops.

The Salvadorian president announced the acquisition of 150 coins on December 7, 2021, at an average price of $48,670. In the week leading up to this, the country purchased 100 Bitcoin on Black Friday.

Nayib Bukele reported the purchase of another 21 bitcoins on the 21st day of the last month of the twenty-first century.

The Salvadoran government has been spending gains in numerous infrastructure development projects since Bitcoin became legal tender.

The President stated in mid-October that $4 million from the income of their Bitcoin Trust would be utilized to build a new veterinary hospital in San Salvador. Bukele stated in early November that the state’s Bitcoin Trust account excess would be utilized to build 20 new schools.

Many investors within the community are also observing El Salvador’s strong bet on Bitcoin and are interested in how this will play out in the long term.

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