YEREVAN (CoinChapter.com) — El Salvador marks three years since it adopted Bitcoin as legal tender, showing a profit of over $31 million. Despite early criticism, the country’s Bitcoin investment has proven beneficial, as El Salvador continues to lead the way in Bitcoin legal tender adoption.
El Salvador’s Bitcoin Journey: From Adoption to Profit
In September 2021, El Salvador became the first country to make Bitcoin legal tender. The government, led by Nayib Bukele, adopted Bitcoin to promote financial inclusion, streamline remittance payments, and boost the nation’s economy. El Salvador began purchasing Bitcoin gradually, implementing a Bitcoin dollar-cost averaging strategy by buying 1 Bitcoin per day.
As of today, El Salvador holds 5,865 Bitcoin, purchased at an average price of $43,877. With Bitcoin currently trading at $54,300, the country’s holdings have reached a total value of over $318 million, according to El Salvador’s Bitcoin investment tracker. This reflects a net $31 million Bitcoin profit from the Bitcoin adoption success.
$31 Million Bitcoin Profit Bolsters El Salvador’s Economy
El Salvador’s Bitcoin adoption success has led to significant financial gains. According to Alex Momot, CEO of Peanut Trade, El Salvador’s Bitcoin strategy has shown tangible benefits. He remarked, “El Salvador’s experiment with Bitcoin can be seen as a success… it’s clear that El Salvador has reaped some benefits.”
The decision to hold Bitcoin and maintain a consistent purchasing strategy has paid off. El Salvador’s Bitcoin profit of $31 million underscores the positive impact of the country’s Bitcoin economy strategy. The country’s Bitcoin holdings have further strengthened the position of Nayib Bukele and his government’s approach to cryptocurrency.
Larger Economies Hesitate as Smaller Nations Adopt Bitcoin
Despite El Salvador’s Bitcoin adoption success, larger economies have not followed suit. While smaller nations like the Central African Republic became the second country to adopt Bitcoin as legal tender in April 2022, major economies remain hesitant.
Momot noted that larger countries are unlikely to take the same risks due to their reliance on international creditors, who are typically against Bitcoin legal tender adoption. Countries like Brazil have shown interest in a legal framework for Bitcoin adoption, but concrete steps have yet to be taken.
El Salvador’s Bitcoin Strategy Amid Market Fluctuations
El Salvador’s Bitcoin journey has faced challenges. In 2022, following the collapse of FTX exchange, Bitcoin dropped to $16,000, which placed El Salvador’s Bitcoin investment in the red. However, the country continued its Bitcoin dollar-cost averaging approach, accumulating more Bitcoin during market dips.
El Salvador holds 5,865 Bitcoin, valued at more than $318 million, as reported by the country’s treasury website.
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