El Salvador’s President Nayib Bukele champions Bitcoin adoption with an innovative strategy: daily purchases. The survey results also show that online consumers in the United States are buying more and more Bitcoins. El Salvador Bitcoin Accumulation was initially planned to start in November 2022, as Bukele envisions Bitcoin playing a vital role in the nation’s economy.
Every day, Bukele buys one bitcoin to create a large bitcoin reserve that can serve as a source of El Salvador’s international reserves and finance the development of subsequent state projects.
While global financial organizations heavily criticized Bukele, he continues to rally the use of Bitcoin in the country’s economy.
Daily El Salvador Bitcoin Accumulation
The president of El Salvador, Bukele, announced that the country purchased one Bitcoin daily to increase the number of Bitcoins held by the government. In its current form, since the start of the program, it has been able to accumulate dozens of Bitcoins in its national reserve. Readily, this systematic approach permits the country to profit from the possible future price increase without harming through the risks of big, individual purchases.
According to the available data, the country has bought more than 2,301 BTC since adopting Bitcoin in September 2021. This was at 200 Bitcoins; the rest varies with significant purchases from list price dips.
Purchase History and Economic Implications
The historic decision of El Salvador to adopt Bitcoin as a performing monetary resource in the country was made in September 2021. As reported by Reuters, the government purchased something like 700 BTC (Bitcoin) during the first month of the announcement alone. As of December 2021, Salvadoran reserves amounted to approximately 1,391 BTC, confirming the authorities’ determination to bring Bitcoin into the country’s economy (CNBC).
Later, in 2022, El Salvador intensified Bitcoin purchases even amid the highly volatile Bitcoin experience. The country, averaging a purchase of 41 BTC per day, bought an extra 801 BTC when markets were low, as reported by Bloomberg. This strategy formed part of the country’s president Nayib Bukele’s economic plan, seeking to harness Bitcoin for long-term investments.
On November 2022, Bukele adopted the purchase of 1 Bitcoin each day for the accumulation of Bitcoin reserve; as of mid-2024, El Salvador has purchased more than 300 Bitcoins (CoinDesk). This approach basically aims to ‘stock’ the Bitcoin, possibly with a view of making profits once the market for the currency strengthens in the future.
But this is not devoid of risk either. Some critics, such as the Economist, have voiced their concern about the prospect of relative economic instability, which Bitcoin precipitates. This is because most of them opine that contrary to benefiting the nation, the country’s integration with Bitcoin might trigger adverse outcomes like fuelling financial instability and the economy’s vulnerability.
The Future of Bitcoin in El Salvador
The experiment with Bitcoin in El Salvador is still attracting global concern as the country is expanding the project with the help of nationalism.
The daily Bitcoin purchases are only one of the measures that the government and central bank of El Salvador are implementing, which are the Bitcoin City and attracting foreign investors.
Whatever the final verdict on Bukele’s initiative, El Salvador is now robustly testing this approach for the world. The world has been waiting to see how this model will affect the country and the advancement of technology in the use of cryptocurrency.
