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El Salvador spends $15 million on bitcoin to ‘buy the dip’

·2-min read
Bukele announced plans to build a “bitcoin city” at the base of a volcano late last year. (AFP via Getty Images)
Bukele announced plans to build a “bitcoin city” at the base of a volcano late last year. (AFP via Getty Images)

El Salvador has spent $15.4 million buying bitcoin as the price of the world’s biggest cryptocurrency drops.

President Nayib Bukele, a vocal bitcoin supporter, said on Twitter his government has purchased 500 coins at an average price of $30,744 each.

“El Salvador just bought the dip!” he wrote.

The country now has 2,301 bitcoin, according to Bloomberg data, with a combined value of just under £60 million at current prices.

Bitcoin briefly fell below $30,000 for the first time in over 9 months today before paring back some of the losses. The cryptocurrency remains around 50% below an all-time peak of $69,000 reached in November last year.

El Salvador became the first country in the world to recognise bitcoin as legal tender in September 2021, despite protests from citizens and calls from the IMF to stop accepting the cryptocurrency or risk missing out on access to loans from the institution.

The move means businesses in the country are obliged to accept bitcoin as a means of payment, something many are not keen on due to the wild fluctuations in the value of the cryptocurrency.

Bitcoin rallied around 50% in two months after El Salvador’s adoption of the crypto but has since halved in value, highlighting its instability.

The recent sell-off has coincided with a slump for tech investments globally as interest rates rise.

Bukele announced plans to build a "bitcoin city" at the base of a volcano late last year. The city would be built in a circular shape to resemble a coin and use geothermal energy from the volcano to power bitcoin mining activity.

40-year-old Bukele, who became president of El Salvador in June 2019, faced widespread international criticism in May 2021 after supporting the ousting of the country’s attorney general and five Supreme Court judges who were opposed to his presidency.

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