El Salvador’s investment in Bitcoin (BTC) is currently showing nearly $20 million in unrealized losses, even though the cryptocurrency recently rallied to $35,000, according to data from Nayibtracker, a platform that monitors the Central American nation’s BTC holdings.
As per Nayibtracker, El Salvador has acquired 3,062 Bitcoin at an average cost of approximately $40,594.93, amounting to roughly $124 million. However, at the time of this report, BTC is trading at around $34,442, resulting in a notable decrease of 15.216% in the country’s investment.
On October 23, Bitcoin briefly reached its highest point of the year at $35,000, driven by increasing optimism surrounding the potential approval of a spot BTC exchange-traded fund (ETF) application by the U.S. Securities and Exchange Commission (SEC). Nevertheless, it’s essential to acknowledge that Bitcoin is still trading approximately 50% below its record high from November 2021.
Notably, President Nayib Bukele of El Salvador played a pivotal role in making BTC legal tender in the country and initiated the government’s cryptocurrency purchases during that time.
Despite these efforts, Bitcoin adoption in El Salvador continues to encounter challenges. In August, a report by crypto research firm Ark Invest revealed that Salvadorans prefer conducting transactions in U.S. Dollars rather than the leading cryptocurrency. David Puell of Ark Invest noted,
“The citizens of El Salvador prefer to transact in USD, which became legal tender in El Salvador in 2001 and has protected purchasing power from the inflation and devaluations that have affected other countries in the region. In contrast, the price of Bitcoin has been quite volatile as it strives to evolve into a monetary system with increased liquidity and global adoption.”
However, Vice President Felix Ulloa has emphasized that the country’s adoption of BTC has contributed to its revitalization. According to Ulloa, this move has attracted numerous investors to El Salvador and has helped elevate the nation’s standing among other countries.
El Salvador’s interest in the crypto community is evident, with Bitfinex recently releasing a documentary on the country’s BTC adoption. Additionally, the crypto payment company Strike has announced plans to relocate its headquarters from Chicago, USA, to El Salvador.