Thanks to changes in the U.S. government's personnel under Donald Trump, as well as record capital flowing into U.S. Bitcoin ETF funds, the world's most valuable cryptocurrency, Bitcoin, has continuously increased in value, nearing the $120,000 mark, according to CoinMarketCap.
Investors are placing strong faith in a 'golden era' of digital currency, while hopes for establishing a national strategic Bitcoin reserve and a more favorable legal environment boost market sentiment.
El Salvador's President Nayib Bukele - who previously defied public opinion by 'catching the bottom' of Bitcoin when it plummeted to $29,000 - now has the opportunity to 'boast' to the world. According to data from BitcoinTreasuries.net, this special country currently holds 6,234 BTC, worth approximately $734.9 million, based on market prices. The initial estimated investment value is around $291.7 million, and it currently has unrealized profits of about $399.8 million (increasing by 137%).
One of the strategies adopted by El Salvador is dollar-cost averaging, buying 1 BTC every day, starting from September 2021, when El Salvador became the first country to adopt Bitcoin as legal currency. The previous decline of Bitcoin was an opportunity for this country to lower its average purchase price.
"I told you so," El Salvador's President Nayib Bukele once wrote as a way to counter previous 'anti' digital currency critics. He has frequently taken to social media to rebut those who criticize the country's economic reform strategy using Bitcoin.
Earlier, on September 7, 2021, El Salvador enacted a Bitcoin law, becoming the first country in the world to accept digital currency as a legal trading currency. El Salvador's President Nayib Bukele then announced the project to establish Bitcoin City, located in the Conchagua volcano region, launched the Chivo Wallet digital wallet, and built a series of Bitcoin ATMs.
This move received numerous controversies at the time and raised concerns from the International Monetary Fund (IMF). They emphasized that excessive reliance on digital currency could inadvertently create risks for the financial system, the people, as well as their credit.
"I see many people are worried because of Bitcoin's decline. My advice is to stop looking at the market charts and enjoy life. If you invest in Bitcoin, rest assured that your investment is still safe. It will soon rise again once the market recovers," Nayib Bukele shared on his personal Twitter page in 2022. He believes that the legal acceptance of Bitcoin will improve El Salvador's economic situation, while also enabling millions of citizens without bank accounts to participate in financial investments.
"Some people told me that El Salvador is facing increasing financial risks due to Bitcoin losses. However, this loss does not actually exist because we have not sold them yet," said Alejandro Zelaya, head of El Salvador's Ministry of Finance, at a time when Bitcoin was losing value.