El Salvador’s Bitcoin reserves lost around 25% of their value after crypto market crash
A recently published survey reveals that, although the drop seen in the price of Bitcoin negatively affected investors in the main digital currency, one of the most affected has been precisely the government of El Salvador, which has seen its value significantly reduced.
According to information shared by the president of El Salvador, Nayib Bukele, to date the country has a total of 1,801 Bitcoin acquired in recent months, for which a total of $88.4 million has been invested to date. Dividing the total BTC by the amount invested, this would result in an average of $49,100 per unit, but this figure is well above the USD $37,440 that the market reflects as a price at the time of publication.
If we multiply the current price of Bitcoin by the amount the country has in reserves, this gives $65.6 million in total assets. This figure reflects losses of $22.8 million, equivalent to almost 25% of the global amount. Said figure is adjusted if the government of El Salvador to date maintains all those 1,801 BTC, since it is not known if it has sold part of them to finance some other program or initiative, such as the funds granted to the users of the wallet.
According to the reports published by Bukele himself through his messages on Twitter, the investment was made as follows:
The situation represents a tough gamble right now for Bukele and the government of El Salvador, as the adoption of Bitcoin faced rejection from both inside and outside the country. Internally, the opposition parties have expressed their disagreement with this measure from the moment of its announcement, which even led to civil protests that led to the destruction of some Chivo points and ATMs, while on the international scene, organizations such as the International Monetary Fund (IMF) have spoken out to discredit said decision and warn other nations not to go down that path.
However, it is currently very difficult to know when the downtrend shaking both Bitcoin and the crypto market in general will end.