The bold bet by the President of El Salvador on Bitcoin is having an impact on the country's economy. With cybercurrency devaluing, national reserves are now worth 51% less than the initial value.
Nayib Bukele, the President of El Salvador, bought 2301 Bitcoins at an average price of $45908🇧🇷 Now, with the devaluation of cybercurrency, the country's reserves in this format, which reached US$105,6 million, are now worth US$51,6 million.
The country's strong and bold bet was met with much criticism and discouraged by international institutions. The International Monetary Fund, for example, recommended in January that the authorities in El Salvador sell their Bitcoin and abandon the decision to keep Bitcoin as the country's official currency. The statements were met with displeasure by the local government, with Treasury Minister Alejandro Zelaya stating that “no international organization is going to force us to do anything, not a single thing".
BUT: Central African Republic is the first country in Africa to make Bitcoin a means of payment
Now, even with the sharp devaluation, Zelaya does not seem worried, saying this week that the price collapse has an "extremely minimal" fiscal risk, as it represents just half a percentage point of the national budget.
In addition to El Salvador, other major portfolios are also suffering from this devaluation: MicroStrategy holds 129218 Bitcoins bought worth almost four billion dollars and are now worth 2,9 billion and Tesla itself has 2 billion dollars in this currency that is now worth 50% less than it once was.
