As an analyst with over two decades of experience in global finance and technology markets, I find El Salvador’s strategy to invest in Bitcoin intriguing and bold. Having closely followed the crypto market’s evolution, it is evident that the Salvadoran government’s move represents a unique approach to economic policy-making and financial inclusion.
It’s said that a cryptocurrency wallet, allegedly belonging to the Salvadoran government, has been acquiring one Bitcoin daily starting from March 16th. This daily purchase has accumulated 162 Bitcoins in the country’s Bitcoin reserves.
According to data from Arkham Intelligence’s blockchain analysis platform, it appears that the cold wallet identified as belonging to the El Salvador government is presently containing approximately 5,851 Bitcoins, which equates to a staggering market value of around $356.4 million.
Every day since March 16, the wallet has been consistently accumulating one Bitcoin. The most recent deposit was just completed a few hours ago at approximately $60,500. Yet, there have been instances where the wallet bought minimal amounts of Bitcoin for under $100.
Based on insights from analyst EmberCN, it’s estimated that El Salvador’s Bitcoin holdings have an average value of approximately $44,835 each. This equates to a current floating profit of around $93.45 million for the country.
1. Purchasing one Bitcoin daily is a commitment made by President Nayib Bukele of El Salvador, with the aim of making Bitcoin too expensive to acquire. On its initial day, the nation transferred 5,689 Bitcoins into a secure digital wallet, giving it an estimated value of $386 million at that time. The president referred to this wallet as El Salvador’s first Bitcoin savings jar.
As a researcher, I’d rephrase that statement like this: In an effort to increase openness about its Bitcoin possession, the South American nation established a public auditing space in the form of a mempool, allowing anyone to scrutinize its cryptocurrency holdings.
Moreover, the administration of Bukele has recently suggested utilizing cryptocurrency for trading with Russia. This notion was proposed by El Salvador as a method to circumvent sanctions that the United States and its allies have imposed on Russia due to its ongoing conflict with Ukraine.
In simple terms, El Salvador uses the U.S. dollar as its official currency, causing complications when trading with countries like Russia, which have limited access to the U.S. dollar due to sanctions. On a positive note, Bitcoin has seen a 0.8% increase in the last 24 hours and a 5.1% rise over the past week. Currently, its market value exceeds $1.2 trillion, accounting for over half (more than 53%) of the total worth of the entire cryptocurrency market.
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2024-08-23 12:12