El Salvador, a Central American country, has suffered several losses totalling over $40 million as a result of recent Bitcoin fluctuations, according to a Bloomberg report. The losses are expected to match the country’s next bond payment of $38.25 million.
The losses started at the end of March and now have increased to almost 40%. According to Bloomberg, the losses have escalated even further, showing the serious consequences of EL Salvador’s Bitcoin investment.
The president of El Salvador, Nayib Bukele, tweeted on May 9th that his country had acquired 500 bitcoins for $30,744.
On the 10th of May, shortly after President Bukele’s declaration, Justin Sun, the inventor of Tron, said through Twitter that after El Salvador’s acquisition, they had also purchased 500 coins for $15,515,675, with a single coin valued at 31031.35.
The Journey of El Salvador with Bitcoin
On September 7, 2021, El Salvador became the first country in the world to introduce laws allowing the use of Bitcoin in business transactions.
According to President Bukele, the country’s legal approach would support a quicker flow of transactions among El Salvador and other nations. Moreover, the decision would assist the country in paying off its foreign loans rapidly.
Meanwhile, the International Monetary Funds (IMF) did not support President Bukele’s decision. The IMF also warned the country’s government about the consequences of adopting Bitcoin.
IMF also described that the usage of Bitcoin poses significant threats to financial integrity, financial stability, and consumer protection.
