El Salvador’s Bitcoin Stash Suffers $11 Million Drawdown

Original author: Brenda Ngari

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President Bukele Has Lost Over $11 Million Trading Bitcoin For El Salvador

The Bitcoin experiment by El Salvador President Nayib Bukele has purportedly put a big dent in the Central American nation’s pocket so far. This was revealed in a Bloomberg report on Wednesday.

Bukele Has Lost $11 Million Trading Bitcoin

El Salvador’s national embrace of bitcoin was easily the most transformational landmark moment for the crypto industry in 2021.

Based on Nayib Bukele’s constant announcements on Twitter that he purchased Bitcoin, the Salvadoran leader has scooped up approximately 1,391 BTC. According to Bloomberg’s calculations, these Bitcoin buys cost El Salvador a staggering $71 million at an average cost of $51,056 per coin.

If El Salvador is still holding all its bitcoin, the total cache is estimated to have a market value of $60 million at the moment. This simply means that Bukele has lost $11 million of the public money.

Notably, the procedure of buying Bitcoin in El Salvador is wrapped in a mystery. To date, no one knows who holds the country’s private keys. The only thing that’s clear is that Bukele trades Bitcoin for the country using only his phone. El Salvador Central America Fiscal Studies Institute economist Ricardo Castaneda told Bloomberg that there’s currently no official information regarding the quantity of Bitcoin bought, the price paid, or even the exact amount held in the Treasury.

El Salvador’s Controversial Bitcoin Experiment

El Salvador last year became the world’s very first — and so far only — country to make Bitcoin legal tender. Merchants and businesses in the country now have to accept the flagship cryptocurrency if they have the necessary technical means.

This decision to adopt BTC was met with a roar of praise from Bitcoin faithfuls but harshly criticized by the International Monetary Fund (IMF), the World Bank, and other well-known legacy players who believe the move is pure folly. A group of Salvadorans has also taken to the streets to protest against the groundbreaking Bitcoin Law.

Despite the protests and controversy, the Bitcoin-loving president frequently announces crypto-related projects in the country. The most recent projects include the Bitcoin bonds and building an entire city based on the largest cryptocurrency by market capitalization. The El Salvador government plans to build the Bitcoin City along the Gulf of Fonseca and it will be powered by geothermal energy, likely from the “inactive” Conchagua volcano.