El Salvador Bitcoin Treasury Surpass Initial Estimates
On March 14, Bukele joked that one can call it their initial Bitcoin piggy bank. Despite not being much, it is honest work.
A March 14 post by Nayib Bukele, El Salvador’s president, on X revealed that his administration shifted a ‘considerable amount’ of its Bitcoin Treasury into a cold wallet and intended to store it in a vault.
El Salvador Commits to Increase Bitcoin Treasury
According to the shared screenshot, the wallet contained 5689 Bitcoin worth $406M. This indicates the price of Bitcoin would have been approximately $71463 when Bukele transferred the funds, which is in line with when the wallet made its initial transaction on March 12.
A report by a media outlet late last month revealed that El Salvador held 2845 Bitcoin worth $ 173M. Bukele has frequently commented about Bitcoin’s price since it became a legal tender in 2021. At this time, it started up a Bitcoin mining operation utilizing geothermal power from a volcano and providing Bitcoin ‘volcano bonds.’
Last month, Bukele was re-elected as president, granting him an additional 5-year term. However, this does not mean that friction has not been there. In this case, the International Monetary Fund (IMF) and El Salvador have been involved in a protracted row following suggestions that the nation must reverse its verdict to legalize Bitcoin.
El Salvador Bitcoin Threatening Americans
Additionally, United States legislators have often noted that the adoption of this cryptocurrency in El Salvador might threaten Americans.
Embracing Bitcoin as a legal tender has unveiled the problem of erratic fees. In May last year, Bitcoin Ordinals, media on the Bitcoin platform that resembles nonfungible tokens (NFTs), experienced an abrupt increase in popularity. This increased the network fees to more than $30 for each transaction.
At the time, Marce Romero, an El Salvadoran, revealed that a $100 transaction in the nation cost more than $20 to complete. Additionally, he noted that persons utilizing the network for ‘fkn jpegs’ (suggesting nonfungible tokens) must think again. This implies that more critical use cases for utilizing Bitcoin exist.
El Salvador Transfers Bitcoin to Cold Storage
Blockchain data reveals that most of the Bitcoin in El Salvador’s cold wallet, nearly 4568 BTC, is being transferred from Bitfinex crypto exchange. Most of it came in the latest transaction on the night of March 14, when a Bitfinex exchange wallet sent 4007 BTC to the cold storage wallet.
At the time of writing, Bitcoin’s price was $67934, following an 8% drop the previous day. This was caused by Grayscale’s transfer of $400M to Coinbase for sale, establishing sufficient downward pressure to send Bitcoin below $69000.
The company’s Grayscale Bitcoin Trust (GBTC) spot Bitcoin exchange-traded fund (ETF) works by selling Bitcoin-supporting ETF shares after being redeemed by investors.
However, since Bukele took the screenshot, the El Salvador treasury wallet has gradually acquired more Bitcoin. On March 15 morning, the wallet contained 5689.7 BTC worth an estimated $415M. In an X post on March 14, Bukele joked that one can call it their initial Bitcoin piggy bank. Despite not being much, it is honest work.
