Amid turbulence in the cryptocurrency market, El Salvador is sticking to its policy of daily Bitcoin acquisition. The bold move raises questions about the long-term viability of the Central American country's crypto strategy.
A determination to face any test
Salvadoran President Nayib Bukele remains steadfast in his crypto vision, despite Bitcoin’s recent fluctuations. Since March 2024, the country has been pursuing its goal of purchasing one Bitcoin per day, regardless of market conditions.
This accumulation strategy constant, regardless of market fluctuations, demonstrates a long-term perspective on Bitcoin's potential.
El Salvador currently holds around 5,700 BTC. To secure this substantial investment, Bukele transferred the funds to a “cold wallet,” an offline wallet that is considered more secure. This strategic move aims to protect national assets from the risks of hacking.
The Vision of a Bitcoin Economy
Beyond simple acquisitions, El Salvador has broader ambitions to integrate Bitcoin into its economy. The project to create a Bitcoin bank, mentioned by Bukele in June, illustrates this desire. This institution would thus facilitate transfers between Bitcoin and US dollars, potentially opening new opportunities for investors and citizens.
Max Keiser, the president’s Bitcoin advisor, is an active supporter of the initiative. He predicts positive economic outcomes, including increased GDP and an improvement in the country’s credit rating, within the next two years.
These optimistic projections, however, contrast with warnings from some economists about the risks of such dependence on a volatile currency.
In short, El Salvador’s bet on Bitcoin remains bold in an uncertain market. As other nations, such as Argentina, dabble in crypto, the world is watching this unique economic experiment closely. Time will tell whether this strategy will make El Salvador a visionary pioneer or expose it to major financial risks.
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