Advertisement

‘We won’t sell’: Bitcoin holdings of El Salvador up 50%, president reveals

The president of El Salvador has said he has no plans to sell the country’s vast bitcoin holdings, despite seeing a profit of over 50 per cent.

The Central American country became the first in the world to adopt bitcoin as an official currency in 2021, while also investing state funds into the asset.

A crypto market downturn in 2022 saw El Salvador facing heavy losses, however a strong recovery means bitcoin is now approaching an all-time high.

The cryptocurrency reached above $65,000 (£51,000) on Monday, less than $4,000 away from its record price from November 2021.

El Salvador holds roughly 2,380 bitcoins, purchased at an average price of $44,300, meaning the $105 million investment is now worth more than $155 million.

“When bitcoin’s market price was low, they wrote literally thousands of articles about our supposed losses,” Mr Bukele wrote on X, formerly Twitter, on Thursday, when bitcoin was trading at around $60,000.

“Now that bitcoin’s market price is way up, if we were to sell, we would make a profit of over 40 per cent (just from the market purchases), and our main source of BTC is now our citizenship program.

“We won’t sell, or course; at the end 1 BTC = 1 BTC (this was true when the market price was low and it’s true now); but it’s very telling that the authors of those hit pieces, the ‘analysts’, the ‘experts’, the ‘journalists’, are totally silent now. Remember this, next time they spill lies again about El Salvador.”

Under El Salvador’s Bitcoin Law, every Salvadoran was eligible to receive $30 worth of free bitcoin in order to incentivise its roll out.

The International Monetary Fund (IMF) criticised the introduction of bitcoin as an official currency, calling for it to be withdrawn in 2022. The organisation cited risks regarding “financial stability, financial integrity and consumer protection”, claiming that price volatility and the potential for criminal misuse made it unsuitable.

El Salvador’s Treasury Minister Alejandro Zelaya dismissed the concerns at the time, saying that bitcoin offered citizens a way to bypass high remittance fees, while also reducing the country’s reliance on the US dollar.

The rising price of bitcoin has been attributed to the recent approval of the first ever spot exchange-traded fund (ETF) in the US, which opened up the market to billions of dollars worth of institutional investment.

An upcoming event called the ‘halving’, which will see bitcoin mining rewards slashed in half, has also been noted by analysts as a factor in the cryptocurrency’s surging price.