San Salvador — El Salvador’s government Bitcoin (BTC) investments suffered a setback on Monday (June 13), when their value lost 50%, in the context of a new collapse of the markets.
The Central American nation has spent $103.6 million to acquire a total of 2,301 Bitcoins since September 7, 2021. The current value of this portfolio is around $52.3 million, a loss of 49.51%, and its lowest valuation for the year.
Bitcoin’s price resumed its decline this weekend after it failed to strongly break the $30,000 barrier in the past days, amid a gloomy outlook in global equity markets due to higher-than-expected inflation.
At the moment of writing, the cryptocurrency was trading at $22,745.98, on Coinbase. At the same time that the price fell below $23,000, Binance, one of the most relevant exchanges in the sector, suspended bitcoin withdrawals. (Binance reactivated them later on.)
Failure to purchase ‘the dip’
The Bitcoin trading price has been falling since November last year, when it peaked at $68,000. It barely had a slight respite in the first quarter of 2022, before continuing its losing run.
President Nayib Bukele has insisted on buying “the dip”, waiting for a rebound that will generate profits. At the end of November, the country had 1,120 Bitcoins, now it has twice as many. So far, the strategy has not worked.
The last time El Salvador went out to buy Bitcoins was on May 9, when it added 500 to its account, with an average price of 30,744. Bukele reported this operation via Twitter, currently the only source used by his administration to disclose this data.
With the prices seen this morning in the markets, this last transaction alone, which cost $15.3 million, shrank to 11.3 million, a drop of -26%.
El Salvador needs that Bitcoin gets back above $45,031 to meet its average investment price.