El Salvador’s Bitcoin Boom: $84 Million Profit Sparks Global Attention

El Salvador’s Bitcoin
Sales Profit, $84 million
Boasts Bitcoin Investment Performance

The era of the 100 million won ($75,210) cryptocurrency Bitcoin continues. As of the 14th, Bitcoin surged to 140 million won, drawing attention to Central American El Salvador.

El Salvador is known as the first country in the world to adopt Bitcoin as legal tender and buy It using the national treasury. The Salvadoran government is estimated to be reaping unrealized sales profits close to 70% of the current value.

Unrealized sales profits refer to profits on the books that have not yet been realized.

In 2021, El Salvador passed a bill in Congress recognizing Bitcoin as legal tender. Since then, Bitcoin has been identified as the official currency of El Salvador, known as the world’s first case of Bitcoin as legal tender.

At the time, protests erupted over complaints such as whether it made sense for a coin to be legal tender in a country where half the population struggled with internet access. But President Nayib Bukele didn’t blink an eye and continued to buy more Bitcoin. He insisted that “it’s good to buy Bitcoin at a low price” and did not back down from his state monetization policy.

Nayib Bukele stated that the purpose of adopting Bitcoin as legal tender was not speculation but a new alternative currency and to reduce exchange fees for the people of El Salvador. He judged that adopting Bitcoin, which does not charge fees for exchange, is advantageous to their own national economy, which is dependent on foreign capital, rather than adopting their own national currency, which would become a piece of trash due to the effects of hyperinflation.

He became the first to mine Bitcoin in El Salvador using the country’s volcanic geothermal energy. Although he suffered significant losses when the price of Bitcoin fell, El Salvador also prospered during the recent resurgence of Bitcoin.

According to Nayib Tracker, a private website that shows El Salvador’s Bitcoin investment gains and losses in real-time, as of the 12th local time, El Salvador is showing unrealized sales profits of 68% thanks to the recent surge in Bitcoin.

The number of Bitcoins in El Salvador is 2,832, which, when converted into estimated sales profits, is estimated to be around $83.57 million or about 111.1 billion won.

Nayib Bukele, the President of El Salvador, retweeted another user’s post on his social media, X (formerly Twitter), saying, “El Salvador is making a profit of $83 million from its Bitcoin investment.”

Since Bitcoin was introduced as legal tender in 2021, the Salvadoran government, which has been buying Bitcoin from time to time, seems to have bought about $121.9 million worth of Bitcoin so far. When converted into won, this is equivalent to 162.1 billion won.

The decision of Nayib Bukele, who is close to a maverick, has paid off. Nayib Bukele started investing in Bitcoin without going through a social consensus process and was criticized in his own country. Especially during the Bitcoin recession in early to mid last year, he suffered a 60% loss, causing anxiety among his people.

The International Monetary Fund (IMF) reportedly reprimanded Nayib Bukele, saying “Do not grant legal tender status to cryptocurrency”. Bukele responded, “It is to reduce dependence on the dollar.”

Despite the IMF’s criticism, he did not stop buying Bitcoin. Instead, it ambitiously implemented various policies guaranteeing Bitcoin as a financial asset, such as mining Bitcoin based on geothermal energy, issuing Bitcoin bonds worth 1 trillion won (approximately $751.87 million), and allowing transfers of cryptocurrencies.

Nayib Bukele is known to have presented various profit models using Bitcoin on X, such as profits from the citizenship offer program, dollar exchange profits for corporations, mining profits, and government service profits.

Meanwhile, Nayib Bukele won a second term in the 2024 presidential election with an estimated vote share of over 80%.