It has now been over 2 years since El Salvador became the first country in the world to adopt Bitcoin as legal tender – a bold policy promoted by President Nayib Bukele. Since then, the decision has been subject to intense domestic and international criticism, often due to unrealized losses from the government’s own BTC investments.
However, after the latest crypto market rally, Bukele has reported that El Salvador’s Bitcoin investments are finally in the black.
After buying large amounts of BTC in the $45,000–$60,000 range back in 2021/2022, the government of El Salvador saw the value of its holdings plummet throughout the prolonged crypto winter that followed.
Yet, throughout the 2022 bear market, Bukele’s government continued to buy. Significantly, its last major purchase in December 2022 occurred near the bottom of the market. From a high of around $55,000, that investment helped bring the average price paid for Bitcoin in its portfolio down to just above $40,000.
Accordingly, with the cryptocurrency’s price climbing above $40,000 on Monday, Bukele reported that El Salvador’s BTC holdings were worth nearly $131M, representing a net profit of $3.6M.
Commenting on the news, Bukele denounced the “thousands of articles and hit pieces” that had criticized the government for its earlier losses and called for the retraction of previous criticisms.
As the price of Bitcoin has risen in 2023, El Salvador’s economic outlook has improved. If the value of its reserves continues to grow, the government could sell its BTC at a tidy profit. But Bukele insisted that “we have no intention of selling.”
“That has never been our objective,” he stated, adding that “we are fully aware that the price will continue to fluctuate in the future, this doesn’t affect our long-term strategy.”