El Salvador has almost $20 million in unrealized losses despite Bitcoin’s recent rally to $35k News ▸ El Salvador ▸ Bitcoin ▸ Crypto
El Salvador has almost $20 million in unrealized losses despite Bitcoin’s recent rally to $35k
Bitcoin rallied to a yearly high of more than $35,000 on October 23 before retracing to its current levels.
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Updated: Oct. 24, 2023 at 1:22 pm UTC
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El Salvador’s Bitcoin (BTC) investment faces nearly $20 million in unrealized losses despite the top asset’s recent rally to $35,000, data from Nayibtracker, a platform monitoring the Central American country’s BTC holdings, reveals.
Per the site, El Salvador has acquired 3,062 Bitcoin at an average cost of approximately $40,594.93, totaling about $124 million. On the other hand, BTC is trading at around $34,442, marking a significant 15.216% decrease in the country’s investment as of press time.
On Oct. 23, Bitcoin briefly touched a yearly high of $35,000 following increased optimism that the U.S. Securities and Exchange Commission (SEC) would approve a spot BTC exchange-traded fund (ETF) application.
Nevertheless, it’s worth noting that the top asset is still trading around 50% below its record high of Nov. 2021. Notably, El Salvador President Nayib Bukele led the country into making BTC a legal tender and initiated the government’s cryptocurrency purchases around this period.
BTC in El Salvador
Bitcoin adoption in El Salvador continues to face troubles despite the country adopting the flagship asset as a legal tender.
In August, a report from crypto research firm Ark Invest revealed that Salvadorans prefer to transact in the U.S. Dollar instead of the top cryptocurrency.
“The citizens of El Salvador prefer to transact in USD, which became legal tender in El Salvador in 2001 and has protected purchasing power from the inflation and devaluations that have ravaged other countries in the region,” Ark Invest’s David Puell wrote.
“In contrast, the price of bitcoin has been quite volatile in the face of growing pains as it endeavors to evolve into a monetary system with increased liquidity and global adoption.”
Despite these concerns, Vice President Felix Ulloa said the country’s BTC’s adoption has contributed to its revitalization. According to Ulloa, the move has helped the country attract many investors to its shores and has helped to reposition it among the comity of nations.
El Salvador draws interest from the crypto community, with Bitfinex recently debuting a documentary on the country’s BTC adoption. Additionally, crypto payment company Strike has revealed intentions to move headquarters from Chicago, U.S., to El Salvador.
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
Nayib Armando Bukele Ortez is a Salvadoran politician and businessman who is the 46th and current President of El Salvador.