El Salvador’s reserves in bitcoin lost half their value as the cryptocurrency fell to its lowest level in more than 18 months. Last year it was the first country in the world to incorporate bitcoin as legal tender.
The cryptocurrency fell 15% on Monday, its biggest one-day crash since March 2020. So far this year it has lost half its value and more than 20% since last Friday alone. Since its all-time high of $69,000 in November, the virtual asset is down nearly 70%.
With the recent decline in the value of the virtual currency, the value of El Salvador’s reserves is now 52 million dollars. This represents a loss of 50.6%. In total, the government bought more than 2,000 bitcoins for the equivalent of $103 million, according to the Salvadoran newspaper The printing press and the international media specialized in finance, Bloomberg.
But the total number of bitcoins that the government acquired is unknown with certainty, since the purchases are only announced through the personal Twitter account of President Nayib Bukele. The last purchase was on May 9, when he invested $15 million of public funds to buy 500 bitcoins.
The ten acquisitions announced by the president on Twitter have a market value of just over $51 million, with the largest single deal (420 coins at over $59,000 each) accounting for almost a 63% loss.
Bukele has said that El Salvador has bought for a dipa term used by operators to refer to the fact that they took advantage of a drop in prices to acquire the asset.
One of the dip What Bukele talked about was the purchase of 420 bitcoins at more than $59,000 each at the end of October, a total of nearly $25 million now worth $9.5 million.
The Minister of Finance, Alejandro Zelaya, assured that the country “has not had any losses” because it has not sold the coins. “When they say that the fiscal risk in El Salvador due to Bitcoin is very high, the only thing it does is make me laugh and I think that any serious economist should do the same, because it really is an extremely superficial analysis and they speak only from the ignorance,” he said.