Even in the face of what many are calling the beginning of the cryptocurrency bear market, the El Salvador government is still buying flagship cryptocurrency asset, Bitcoin. The Latin American nation has added 410 Bitcoin (BTC) to its central reserve as BTC price dipped below the $40,000 support zone to prices not seen since July 2021.
This announcement was made by no other than the President of El Salvador, Nayib Bukele. He took to Twitter to confirm the purchase of 410 BTC was made against $15 million, placing the price at approximately $36,585 per BTC.
His tweet reads, “Nope, I was wrong, didn’t miss it. El Salvador just bought 410 #bitcoin for only 15 million dollars. Some guys are selling really cheap.”
What you should know
El Salvador adopted BTC as a legal tender in September 2021, as a means to overcome catastrophic inflation amid the weakening spending power of the nation. Since the adoption as a legal tender, the country has so far, strategically accumulated 1,801 BTC over the past four months.
El Salvador adopts a ‘buy the dip’ strategy when it comes to accumulating Bitcoin. Anytime there is a fall in the price of Bitcoin, the President announces the accumulation of more Bitcoin into the nation’s reserve.
The latest purchase is currently the cheapest acquisition for El Salvador ever since the country adopted BTC as a legal tender. With BTC trading just above the $36,000 mark and the resultant sell-off, Bukele believes that “some guys are selling really cheap,” supporting his long-term vision of mainstream Bitcoin adoption.
BTC experienced a steady rise in prices from mid-July, which resulted in an all-time high of almost $69k in the first week of November. However, the next three months saw a steep decline in market prices as investors redirected BTC profits into buying other tokens.
Bukele has proposed several initiatives in the country around Bitcoin adoption and mining. The government has started construction of the infrastructure to support the state-issued Bitcoin wallet, Chivo, and recently unveiled plans to launch its own Bitcoin City at the base of a volcano, funded initially by $1 billion in Bitcoin bonds.
Since the adoption of Bitcoin as a legal tender, the Salvadoran government has been investing gains onto various infrastructure development projects. In mid-October, the President announced that the $4 million from the profits of their Bitcoin Trust will be used to construct a new veterinary hospital in the capital, San Salvador. Early November, Bukele announced that the surplus earned from the state’s Bitcoin Trust account will be used for constructing 20 new schools.