The president of El Salvador, Nayib Bukele, is facing a lot of criticism after the recent decline of Bitcoin. He has been accused of leading his country into bankruptcy. But true to form, he wants to reassure on the current market conditions.
Salvadorian president addresses bear market concerns
As Bitcoin (BTC) has corrected sharply in recent weeks to fall below $20,000 for the first time in 18 months, El Salvador’s President Nayib Bukele has come under heavy criticism for investing heavily in the highly speculative cryptocurrency market.
Today, the country’s Bitcoin portfolio is suffering a multi-million dollar loss, bringing it close to default. But the country’s ever-so-crypto-friendly president is reassuring about investors’ growing concerns about the future of Bitcoin.
As tensions and fears mount amid falling prices, Nayib Bukele has decided to offer advice in a tweet to Bitcoin investors who may be concerned about the prolonged bear market:
I see that some people are worried or anxious about the Bitcoin market price.
My advice: stop looking at the graph and enjoy life. If you invested in BTC your investment is safe and its value will immensely grow after the bear market.
Patience is the key.
– Nayib Bukele (@nayibbukele) June 19, 2022
President advises everyone not to follow the Bitcoin charts and to “enjoy life”. Patience is the key,” he says. And it’s true that historical data shows that after every drop in its history, the famous cryptocurrency has risen to even higher highs.
But the tweet received mixed reactions from the cryptosphere, with many users pointing out that the country had been sourcing bitcoins at a much higher price and that the market would continue its decline. And as with every crisis, there are those who think Bitcoin is over, and those who think Bitcoin will rise even stronger.
Some cryptocurrency enthusiasts have suggested to the Salvadoran president that he should launch bitcoin bonds.
El Salvador’s loss in Bitcoin investments
On September 7, 2021, El Salvador became the first country in the world to adopt Bitcoin as a legal tender. At that time, the cryptocurrency was trading around $50,000.
To find out how much the small country’s portfolio is losing, a website nayibtracker.com tracks the amount of Bitcoin El Salvador owns in real time, as well as the gains or losses of these investments.
It shows that El Salvador has 2,301 Bitcoins, with a one-time cost price of $45,908.42 per Bitcoin (while Bitcoin is currently trading at around $20,300). Thus, the country’s investments in the cryptocurrency show a 55% capital loss, or $58 million. This is, of course, an unrealised loss.
Despite the widespread criticism, Alejandro Zelaya, El Salvador’s finance minister, dismissed claims a few days ago that the country had lost more than $40 million, saying:
“I have said it many times: A supposed loss of $40 million did not happen because we did not sell the bitcoins. “
In fact, this loss is only temporary and no doubt El Salvador’s investments will return to positive territory when the market recovers.
