El-Salvador, a country in Central America, reported that due to the recent fluctuation of the cryptocurrency, Bitcoin, it has incurred numerous losses leading to about $40 million, as noted by Bloomberg in a recent report. The losses are estimated at the next $38.25 million bond payment by the country.
El Salvador’s President Bukele Recently Bought the Bitcoin Dip
Losses started at the end of March and have continued to rise to around 40%. As Bloomberg points out, the losses have continued to mount and represent the alarming risks of EL Salvador’s investment in Bitcoin.
Meanwhile, this information comes after El Salvador’s president Bukele took to his Twitter handle on May 9 to announce that El Salvador has purchased 500 bitcoins for the price of $30,744. He tweeted: “El Salvador just bought the dip.500 coins at an average USD price of ~$30,744″
In addition, shortly after the tweet from El Salvador President Bukele, Justin Sun, the founder of Tron announced through his Twitter handle on May 10 that they also purchased 500 coins for $15,515,675 following the El Salvador purchase. with a single coin of 31031.35.
El Salvador’s Journey with Bitcoin
On September 7, 2021, President Bukele of El Salvador announced that Bitcoin can be used to conduct financial transactions. El Salvador was subsequently marked as the first country in the world to pass a law allowing its citizens to use Bitcoin when conducting business transactions.
President Bukele noted that Bitcoin as El Salvador’s legal trend will encourage a faster flow of transactions between El Salvador and other countries. In addition, the decision will help El Salvador quickly pay off its foreign debts.
Meanwhile, President Bukele’s decision was not widely accepted as the IMF, the International Monetary Fund, warned the government of El Salvador of the risks associated with enabling Bitcoin as the legal trend in the country. They further stated that it will be an impossible mission to get a loan from them.
The IMF further noted that using Bitcoin poses huge risks to financial integrity, financial stability and consumer protection.
Sunil is a serial entrepreneur and has been working in blockchain and cryptocurrency space for 2 years now. Previously, he was a co-founder of Govt. of India supported startup InThinks and is currently editor-in-chief at Coingape and CEO at SquadX, a fintech startup. He has published over 100 articles on cryptocurrency and blockchain and has assisted a number of ICOs in their success. He co-designed an industry training for blockchain development and has conducted many interviews in the past. Follow him on Twitter @shamasunil8114 and contact him at sunil (at) coingape.com
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This post El Salvador Loses $40 Million Amid High Bitcoin Volatility
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