El Salvador is honoring its three-year anniversary of being the first nation to recognize Bitcoin as legal currency, having enjoyed a windfall of over $31 million in profit as a result. The groundbreaking decision of President Nayib Bukele to adopt this digital currency as legal tender was seen as a significant move for advancing financial inclusion, streamlining remittance payments, and inciting economic innovation.
This strategic adaptation to Bitcoin initiated by El Salvador played a pioneering role in the crypto-sphere, suggesting that venturing into the unknown can result in success, as per Alex Momot, CEO and founder of the Peanut Trade crypto trading platform. He underscored that while it’s premature to gauge the successful implementation regarding all facets of this modification, El Salvador’s initial profits speak for themselves.
El Salvador implemented a strategy whereby it regularly invested in Bitcoin since 2021, with a daily purchase of 1 Bitcoin. This approach has culminated in the accumulation of a profit of more than $31 million, as displayed on the Nayib Bukele Portfolio Tracker website. These Bitcoin holdings were acquired at an approximate mean price of $43,877 per BTC, in comparison to the value of $54,300 that Bitcoin held as of 10:55 am UTC, September 7.
According to Momot, this $31 million Bitcoin profit has added financial value despite initial skepticism, reinforcing Bukele’s position and underscoring the value of his audacious experiment with digital currency. As stated on the national treasury website, El Salvador now possesses a total of 5,865 Bitcoin, valued at over $318 million.
However, Bukele’s daring move attracted a barrage of critique particularly when Bitcoin’s value cascaded from its record high of $69,000 in November 2021, amplified by the FTX exchange’s breakdown. This dip in the overall crypto market led to El Salvador’s Bitcoin holdings plummeting alarmingly, as Bitcoin sank to a meager $16,000.