bennymarty/iStock via Getty Images
Since it started buying bitcoin (BTC-USD) in September 2021, El Salvador’s holdings are getting sliced by around 50% amid immense selling pressure in cryptocurrencies as well as increased regulatory scrutiny.
The country’s bitcoin (BTC-USD) stash was last valued at $52.4M compared with its total investment of nearly $104M.
As of May 9, El Salvador, the first country to make bitcoin (BTC-USD) legal tender, was HODLing 2,301 BTC at an average price of $43.8K.
President Nayib Bukele’s investing strategies of “buy the dip” and “HODL” certainly don’t seem to be paying off, as bitcoin (BTC-USD) earlier this week tanked to its lowest since December 2020. Over the past 24 hours, the world’s largest digital token by market cap is sliding to $22.2K as of shortly before 3:30 p.m. ET.
Still, the unrealized bitcoin (BTC-USD) losses likely won’t hurt El Salvador’s fiscal health. “When they tell me that the fiscal risk for El Salvador because of Bitcoin is really high, the only thing I can do is smile,” said El Salvador’s Finance Minister Alejandro Zelaya at a press conference, as reported by Reuters on June 13. “The fiscal risk is extremely minimal.”
Take a look at how MicroStrategy (MSTR) and Tesla’s (TSLA) bitcoin (BTC-USD) positions are faring
As Bitcoin (BTC-UDS) craters over 26% just in the past five sessions, there could be room for some upside. It’s “looking to form a local bottom between the $20-$22k range, with a potential bounce towards $26k, however, the likely scenario is that price will further fall below towards $14-$17k range where a cyclical bottom can potentially form,” said Abdul Gadit, CFO and co-founder of Zignaly, a platform allowing investors to copy crypto trades of digital asset managers.
Earlier, ethereum drops faster than bitcoin, spelling trouble for altcoin sentiment.