Key Takeaways:
- Nayib Bukele misused funds from the Central American Bank for Economic Integration to promote Bitcoin.
- The funds came from the $600 million loan CABEI gave to El Salvador during the COVID-19 pandemic.
- El Salvador became the first country to declare BTC legal tender in 2021.
YEREVAN (CoinChapter.com) — El Salvador’s crypto-friendly president Nayib Bukele used a $600 million loan from the Central American Bank for Economic Integration (CABEI) to promote Bitcoin (BTC) as a legal tender in his country.
The damning allegation comes from a recent investigative report by the Organized Crime and Corruption Reporting Project (OCCRP). The global network of investigative journalists collaborated with media outlets to look into how the funds coming from the bank were spent.
The results of the scrutiny do not look good for the self-dubbed “coolest dictator.”
In 2021, Bukele sent shockwaves after announcing El Salvador would make BTC legal tender. He subsequently embarked on a Bitcoin-buying frenzy.
He purchased almost every time the cryptocurrency’s price fell. However, in November 2022, he announced his intention to buy one BTC every day.
Nayib Bukele misused funds to promote Bitcoin
In early 2021, El Salvador’s economy was struggling. The COVID-19 pandemic, which broke out at the end of 2019, had created havoc. By 2020, the country’s economy had shed around 8%. Constant lockdowns had made life hard for Salvadorans.
To help the Government cope, the Central American Bank for Economic Integration (CABEI) issued a $600 million loan.
This loan, the second-largest the bank has given to El Salvador, was meant as an assistance to small businesses. CABEI President Dante Mossi had announced the loan would benefit 4 million people.
However, instead of using it for that purpose, Bukele misused parts of the funds to promote BTC.
According to Panama-based newspaper La Prensa, Bukele used only about $20 million of this loan as intended. The conservative paper was one of the media houses that participated in the investigation.
Per its report, Bukele’s government diverted most of the cash to fund its own needs. It went ahead and allocated $425 million to “general state obligations.”
“Of that amount, more than $200 million went toward a pet project of El Salvador’s authoritarian leader Bukele: converting bitcoin into national currency,”
the paper wrote.
The findings against Bukele are part of a larger investigation against the Central American Bank for Economic Integration.
According to reports, the CABEI has assisted politicians in its five founding states: Nicaragua, El Salvador, Honduras, Guatemala, and Costa Rica, to deepen corruption and authoritarianism.
Maybe Nayib Bukele’s pet project of saving El Salvador through Bitcoin (BTC) wasn’t as innocent or innovative after all?
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