El Salvador, the first country to make Bitcoin (BTC) legal tender, has purchased an additional 80 BTC. The country’s president, Nayib Bukele, announced via Twitter earlier today. According to him, the Salvadoran government bought the tokens at an average price of $19,000. This means the government spent around $1.52 million on this purchase.
Thank you for selling cheap 😉 pic.twitter.com/ZHwr0Ln1Ze
— Nayib Bukele (@nayibbukele) July 1, 2022
This news comes on the heels of Bukele announcing the purchase of another 500 BTC on May 9. This purchase brought El Salvador’s BTC holdings 2,301 tokens worth approximately $71.1 million at the time.
El Salvador just bought the dip! 🇸🇻
500 coins at an average USD price of ~$30,744 🥳#Bitcoin
— Nayib Bukele (@nayibbukele) May 9, 2022
El Salvador Finance Minister Says BTC Has Minimal Fiscal Risk
El Salvador’s commitment to its BTC strategy comes as the crypto winter continues intensifying.
At the time of writing, BTC is changing hands at $19,429.10, valuing El Salvador’s 2,381 BTC at 46,260,687.1. This means the bear market has erased nearly half of the value of El Salvador’s BTC holdings in under a month.
The country’s decision to increase its BTC exposure amid a bear market stems from the belief that the cryptocurrency will soon bounce back. Additionally, El Salvador’s Finance Minister, Alejandro Zelaya, recently said a drop in BTC’s price cannot harm the country’s fiscal health.
During a press conference in June, Zelaya said,
When they tell me that the fiscal risk for El Salvador because of Bitcoin is really high, the only thing I can do is smile. The fiscal risk is extremely minimal.
Waiting for Favorable Market Conditions to Issue BTC-backed Bonds
Bullish that BTC will soon make a comeback, El Salvador’s government also plans to issue $1 billion in BTC-backed bonds. The government initially sought to issue the bonds on March 15. However, it postponed the issuance, citing unfavorable market conditions.
El Salvador plans to spend $500 million from the funds to purchase more BTC. The other half will go toward funding the construction of Bitcoin City and setting up BTC mining facilities. The mining farms will leverage geothermal power from the Conchagua stratovolcano, according to the government.