Entire Country’s “Reserves” Wiped Out Overnight
(RightWing.org) – El Salvador has become the latest victim of cryptocurrency hysteria. The Central American nation invested over $100 million in Bitcoin. Now, more than half of it is gone.
The value of El Salvador's Bitcoin stash has lost half its value amid the cryptocurrency crash.
— Washington Examiner (@dcexaminer) June 15, 2022
When El Salvador became the first nation to adopt a cryptocurrency as legal tender last June, the move raised some eyebrows among financial experts. The country has bought a total of 2,301 Bitcoin at an average of around $45,000 each, giving a total investment of $104.6 million. When Bitcoin lost 15% of its value in September 2021, Salvadoran President Nayib Bukele didn’t waver from his plans to create an alternative currency system, and in fact, bought another 150 Bitcoin hoping to profit by “buying the dip.”
In January, the International Monetary Fund (IMF) warned the country to sell off its cryptocurrencies and drop Bitcoin as legal tender, but Finance Minister Alejandro Zelaya refused, saying “No international organization is going to make us do anything.”
Now Bitcoin isn’t dipping; it’s crashing. In the last week alone, it’s lost 31.94% of its value, and on June 17, it was worth under $20,500 per coin — just 45% of what El Salvador paid for its stash of the electronic tokens. Zelaya insists that “The fiscal risk is extremely minimal” — but the IMF is unlikely to agree, and if El Salvador’s cash reserves keep shrinking at this rate, it’s the IMF Zelaya will be asking for help.
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