After rallying to near $53,000, bitcoin recoiled in a crypto market rout. Yet, El Salvador just plowed more millions to Bitcoin, signaling the nation’s relentless conviction in the cryptocurrency amid the latest price slump. The purchase brings El Salvador’s BTC holdings to 550.
El Salvador Undeterred By Bears
Bitcoin took an epic fall on Tuesday, pointing to a disastrous week ahead. As bitcoin dropped from over $52,000 to sub-$43,000 levels in what is evidently the biggest pullback since the May China-induced rout. Some crypto analysts attributed the downtrend to selling by whales on the day that El Salvador made bitcoin legal tender.
Bitcoin has parred some of the losses to settle above $46,000 at the time of publication, and some traders may be anxious about the flagship cryptocurrency’s next move. Meanwhile, ethereum, Binance Coin, Cardano’s ADA have lost between 12.97% to 16.32% on the day.
But not everyone is hitting the sell button. In fact, El Salvador has just swooped in and bought the dip.
President Nayib Bukele took to Twitter to announce that his government had purchased an additional 150 bitcoins, worth roughly $7 million at the time of purchase. As earlier reported by ZyCrypto, El Salvador purchased $400 BTC hours before formally adopting it as a national currency.
The latest 150 BTC purchase brings the country’s total to 550 bitcoins, worth around $26 million at current prices. Moments after revealing the buy, Bukele noted that the bitcoin discount was ending. He also expressed his gratitude to the International Monetary Fund (IMF) for helping his nation “save a million in printed paper”.
For background, the IMF has frantically opposed El Salvador’s decision to adopt BTC and oftentimes issued serious warnings against the pioneering bitcoin play.
El Salvador And The Controversial Bitcoin Law
El Salvador has partnered with digital currency payments processor Strike and crypto custody firm BitGo to create the infrastructure needed for the bitcoin initiative.
As part of the new Bitcoin law, Salvadoran merchants and sale outlets will be required to accept bitcoin as payment for goods and services. The small country will be preloading state-sponsored Chivo bitcoin wallets with a free $30 worth of BTC for the local users that register.
However, the country’s Chivo wallet, which is only currently available on the Huawei App Gallery, was temporarily disabled earlier today as server capacity was increased.
The road to bitcoin adoption in El Salvador has been one filled with so many hurdles. Shortly after the legislation was passed in the country’s congress in June, the opposition party launched a lawsuit to repeal the law. More recently, citizens took to the streets to protest bitcoin’s approval as legal tender on the grounds that they were not consulted, the cryptocurrency is extremely volatile, and fears that it would be used to facilitate money laundering.