San Salvador, El Salvador (AP) – El Salvador’s Bitcoin-boosting president has urged people to be patient after the cryptocurrency price drops below $ 20,000 – less than half the price paid by the government.
According to the tracking site nayibtracker.com, the administration of El Salvador’s President Naib Bukele spent about $ 105 million on bitcoin during the administration, paying an average of about $ 46,000 per coin since last September.
That investment in the currency, also known as “BTC”, is now estimated to have fallen 57%, or almost $ 61 million.
“I see some people are worried or anxious about the #Bitcoin market price,” Bukele wrote on his Twitter account late Saturday. “My advice: Stop looking at the graph and enjoy life. If you invest in #BTC your investment is safe and its value will increase exponentially after the bear market.
“Patience is key,” the president wrote.
On Tuesday, when a Bitcoin publication said El Salvador had “just” lost $ 40 million on its investment, Buckell tweeted with clear confidence: “Are you telling me we should buy more #BTC?”
Bukele became the first leader in the world to convert cryptocurrency into a legal tender last year and remained a dedicated booster until at least May, when he boasted of “buying dip” in the currency price. But since then the coin has slipped further.
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Finance Minister Alejandro Zelaya, in an interview with a local television station on Wednesday, asked that the situation be clarified, saying that since El Salvador did not sell any of its bitcoins, it did not really hurt.
“When they told me that El Salvador’s budget risk increased because of the expected loss, that loss did not exist,” Zelaya said. “That should be clear, because we did not sell.”
However, most companies and governments write off what accountants call “unrealistic loss” even if they do not sell the property in distress.
Zelaya emphasized that the bitcoin slide did not matter much to El Salvador, “it does not even represent 0.5% of our budget.”
This proves to be the hardest sale in a country where nearly one-fifth of the population lives on less than $ 5.50 a day.
In January, El Salvador rejected a recommendation by the International Monetary Fund to abandon bitcoin as a legal tender.
Zelaya at the time described it as a “sovereignty” issue, saying “no international organization will do anything for us, anything”.
The IMF has recommended that El Salvador cancel the $ 150 million trust fund created when cryptocurrency was made a legal tender and return any unused funds to its treasury.
The IMF cited concerns about the volatility of bitcoin prices and the possibility of criminals using cryptocurrency.
Bukele promoted Bitcoin as a way to attract millions of people who previously did not have bank accounts into the economy and significantly increase financial inflows. He also talked about parallel tourism promotion targeting bitcoin enthusiasts.
Bouquet led the way in accepting bitcoin as a legal tender along with the US dollar. The El Salvador Legislative Assembly made the country first in June 2021.