The South American country is among Bitcoin investors to benefit greatly from the Donald Trump-fueled cryptocurrency bull run as its portfolio of digital assets reaches novel highs, analysts said.
The value of El Salvador Bitcoin cryptocurrency holdings rose to $632 million after the original cryptocurrency hit a novel all-time high of $106,488 per coin.
Portfolio increased by over 133%
President of El Salvador Nayib Bukele was overjoyed to share on his X account the huge profits his country made from investing in Bitcoin when the price of the cryptocurrency exceeded 106,000. dollars.
Bukele proudly posted on social media that the South American country’s Bitcoin portfolio grew by 134%, reaching $632 million. The Alpha cryptocurrency has reached another milestone, a record high of $106,488, increasing the value of El Salvador’s crypto assets.
— Nayib Bukele (@nayibbukele) December 16, 2024
The South American president showed in his post that the country made more than $350 million on Bitcoin investment, benefiting from the cryptocurrency’s latest surge in value.
Bukele developed the country’s Bitcoin investment strategy, under which El Salvador purchased 5,966 BTC with an initial value of $270 million. Currently, Bitcoin resources in the country amount to $632 million BTC price exceeded $106,000.
Bitcoin as legal tender
In 2021, El Salvador announced that it had adopted Bitcoin as legal tender in the country, making the South American nation the first country to make the move.
Bukele believes that Bitcoin would allow the country to reduce its dependence on the US dollar, adding that the cryptocurrency could be used to promote financial inclusion and drive economic growth.
BTC market cap currently at $2.06 trillion. Chart: TradingView.com
However, many of the country’s citizens were skeptical about cryptocurrencies, raising concerns about the volatility associated with the digital asset.
Skepticism towards Bitcoin deepened further in 2022 as the price of BTC fell below $17,000, causing greater concern among El Salvadorans about the investment strategy.
But now it appears that Bukele’s crypto gamble has paid off, as the value of the country’s cryptocurrency portfolio has surpassed $600 million.
BTC price retreats to $104k in the last 24 hours. Source: Coingecko
IMF urges El Salvador to reconsider
El Salvador may have reached a milestone in its Bitcoin investment. However, International Monetary Fund (IMF) still not convinced by the huge profits from cryptocurrencies, calling on the Bukele administration to reconsider its position on Bitcoin.
Analysts believe that the cryptocurrency remains a double-edged sword due to its volatility, noting that the cryptocurrency’s current price may be impressive, but it could also decline in value.
Bukele continues to stand by his investment in BTC, even announcing a proposal to transfer some of the country’s BTC assets to a frigid wallet safely stored within the country’s borders.
Moreover, he is also considering the creation of Bitcoin City, which he says would be a futuristic, tax-free hub powered by domestic geothermal energy.
Featured image from DALL-E, chart from TradingView
