The Bitcoin stats for Central America are now worth more than $200 Million. With the tremendous growth in Bitcoin prices, the government of El Salvador is planning to add more.
Nayib Armando Bukele Ortez, the president of El Salvador, launched the Bitcoin buying strategy which has been paying off expenses for El Salvador. Following the ongoing Bitcoin rally, it is making 70% on the dollar cost average.
El Salvador’s Crypto Treasury
El Salvador’s crypto treasury is showing a profit of approximately $83 Million. In percentage terms, it is up by approximately 68%. These profits were recorded when Bitcoin marked another all-time high above $72,000.
The nation began buying Bitcoin in September 2021, when it became a legal tender. During the time of the purchase of the first 200 Bitcoins, it was trading at $51,769.
Citizens and officials questioned Bukele’s strategy when, in November 2022, the price of Bitcoin fell from its all-time high ($69,000) marked in November 2021 to a low of $16,000 in the bear market. It plunged a significant red in the portfolio.
However, it turned back to green when it crossed the average buying cost of $42,600 in February 2024, and the momentum of growth has continued since then. The BTC price is breaking all the new all-time highs daily.
The entire portfolio consists of around 2,861 bitcoins, currently valued at $205.5 Million.
Movements in the Portfolio
President Bukele commented on 12 March that along with the profit, there was also revenue in Bitcoin from the country’s passport program. The revenue is converted from BTC to USD for local businesses, revenue from BTC mining, and revenue from government services.
El Salvador in December approved a migration law that easily granted citizenship to foreigners who make Bitcoin donations toward the government’s social and economic development programs.
The country launched its first Bitcoin mining pool with a partnership between Volcano Energy and Luxor Technology in October.
Growth of Bitcoin is Supporting Financial Growth of El Salvador
Based on the current growth trajectory of Bitcoin, it can be said that if this trend continues, Bitcoin can reach $100,000 by the end of this year. If that target is achieved, El Salvador can pay off debts owed to the International Monetary Fund (IMF). It will also help the nation become financially independent soon. These are the beliefs of venture capitalist Tim Draper.
In February, Bukele was re-elected and won a landslide presidential election. He also expressed his views against previously received criticism, stating, “When Bitcoin’s market price was low, they wrote literally thousands of articles about our supposed losses.”
In the recent interaction, he has highlighted additional revenue sources related to Bitcoin, including its passport program, local business transactions, Bitcoin mining, and government services.
El Salvador’s experience serves as a foundation for the adoption of cryptocurrency by sovereign nations. It also emphasizes the challenges and opportunities presented by the integration of digital currencies and national economies. It provides several insights for policymakers worldwide.
