Do you still remember El Salvador, the world’s first “currency speculator country” to use Bitcoin as legal tender? With the recent rebound in Bitcoin prices, El Salvador’s Bitcoin holdings finally turned losses into profits. El Salvador’s President Nayib Bukele was obviously elated after finally making money from his “coin speculation”. He not only showed off his holding accounts for currency speculation in a high-profile manner on X, but also threatened to make those doubters and opponents apologize.
El Salvador’s “coin speculation” account finally made money
For most people in the country, one of the biggest impressions of El Salvador is that it is the first country in the world to use Bitcoin as legal tender.
In September 2021, El Salvador officially announced that Bitcoin would become legal tender. As the first "crab-eating" country, El Salvador has encountered a lot of doubts and concerns. The International Monetary Fund (IMF) has repeatedly warned about the country's financial risks, and Fitch, one of the three major international credit rating agencies, has therefore downgraded the country's rating to junk status.
In 2022, as Bitcoin prices continued to slump, El Salvador’s government Bitcoin holdings also suffered losses along the way. But President Bukele of El Salvador remained unmoved and insisted on adding positions. As of now, the El Salvadoran government has $130 million worth of Bitcoin in its accounts.
Since the beginning of this year, relying on the continued rise in Bitcoin prices, El Salvador’s “coin speculation” transactions have finally turned losses into profits. On Monday Eastern Time, as Bitcoin exceeded $42,000 for the first time in 20 months, President Bukele of El Salvador excitedly published a long tweet on X, boasting in a high-profile manner about the country’s investment in cryptocurrency.
Bukele shared a screenshot of El Salvador’s Bitcoin investment portfolio, emphasizing that “El Salvador’s Bitcoin investment is making money!”
He said:
“Thousands of articles and trending articles have previously ridiculed our alleged losses, but those losses were calculated based on the Bitcoin market price at the time... At the current price after the cryptocurrency’s recent rise, if we sold all of our Bitcoins, we would not only recoup our entire investment, but also make a profit of over $3,620,700.”
Bukele also emphasized that the country does not intend to actually sell Bitcoin, as this would run counter to long-term goals.
"Of course, we have no intention of selling; that has never been our goal... We are fully aware that prices will continue to fluctuate in the future and this will not affect our long-term strategy."
He once lost tens of millions of dollars due to "currency speculation"
Although El Salvador's "coin speculation" currently has a floating profit of US$3.6 million, it cannot be ignored that when the price of Bitcoin was low last year, El Salvador's "coin speculation" account also experienced a large floating loss.
According to media reports, when the price of Bitcoin hovered at US$17,000 per coin at the end of last year, El Salvador’s currency speculation account suffered a huge loss of more than US$67 million.
But Bukele still ignored outside criticism at the time and emphasized that "the loss of more than $67 million was not a real loss because I did not sell any Bitcoin."
Now, as the price of Bitcoin rebounds, Bukele is obviously feeling proud and says that those "opponents" who once questioned El Salvador should apologize for questioning the country's investment decisions.
He wrote on
Bitcoin has risen more than 150% so far this year, driven by investor expectations that the Federal Reserve will cut interest rates next year.
At the same time, the possible approval of the Bitcoin spot ETF by the US SEC, coupled with the Bitcoin halving event expected to occur in April 2024, has also increased people's optimism.
As Bitcoin has risen, cryptocurrency-related stocks have seen similar triple-digit gains on the U.S. stock market: Coinbase, MicroStrategy and Riot have all soared more than 200% this year.
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