The cryptocurrency market is currently in turmoil and prices of all cryptocurrencies are plunging, including Bitcoin. The world’s first cryptocurrency has lost more than 50% of its value since the beginning of the year and many people see this as an opportunity to buy the dip. It appears that El Salvador was also thinking along the same lines, as it recently acquired 80 more bitcoins to add to its stash.
After the recent purchase, the total Bitcoin holdings of the country have now reached 2,381 BTCs. Even though the ongoing fall in crypto prices has pushed the first cryptocurrency in the world to lows last seen in 2020, El Salvador continues to increase its holdings.
President makes the announcement
Nayib Bukele, the El Salvadorian President, announced the latest purchase of 80 bitcoins. More than $1.5 million were spent on this acquisition and it is meant to support the Bitcoin law they have implemented.
Last year, El Salvador made history when it became the first country in the world to adopt Bitcoin as legal tender. Even though the fall in the price of bitcoin has resulted in losses, the country continues to reiterate that the move is a good one because it expects prices to rise in the future. Therefore, it has taken advantage of the recent dip in the market to add to its coins.
Bukele disclosed in a recent tweet that they had paid an average price of about $19,000 per coin. Bukele did not hesitate in praising the leading crypto and called on the future of money. He was also appreciative of its low value because this allowed him to expand their holdings.
Fall in value of bitcoin holdings
It should be noted that El Salvador has acquired 2,381 bitcoins so far and all of them have been bought at different prices. In the last few months, after El Salvador had passed the Bitcoin law, it has spent a total of $105 million on acquiring the cryptocurrency.
But, with the crypto bear market, the value of the bitcoin holdings of the country now has unrealized losses of $60 million. This has given rise to concerns about the financial status of El Salvador. Alejandro Zelaya, the finance minister of the country, recently put these concerns to rest.
He said that the crypto market conditions would not have any such impact on the financial status of El Salvador. He said it has minimal risk.
While the finance minister may not consider it risky, there is no denying that El Salvador is in trouble and this is only adding to the country’s losses. When it adopted BTC as legal tender, prominent financial bodies like the International Monetary Fund (IMF) and the World Bank issued warnings about the risks to financial stability.
Nonetheless, the Central African Republic does not seem to be deterred by any of these warnings and has continued to expand its bitcoin holdings because Nayib Bukele believes it is the currency of the future.