El Salvador grabs $1.5 million more Bitcoin, but sits heavily in the red

El Salvador grabs $1.5 million more Bitcoin, but sits heavily in the red

El Salvador bought the Bitcoin dip again, piling into the crypto asset as a market collapse has led to a sharp drop in its price.

President Nayib Bukele said on Friday that the country had purchased 80 Bitcoin for $19,000, worth around $1.5 million. “Thanks for selling cheap,” he wrote in one tweet This included screenshots of 40 transactions.

The country's last Bitcoin purchase was in May, when it Bought 500 Bitcoin at an average price of $30,744 each. This brought the total holdings to 2,301 Bitcoins, worth around $71.4 million at the time. After the latest purchase and due to falling prices, El Salvador holds 2,381 Bitcoin worth $46.4 million, according to Bukele's Twitter updates.

President El Salador is trying to “buy the dip” again, this time as bearish market sentiment from hawkish central banks and a series of big blowouts from cryptocurrency firms have prices trading near 2017 all-time highs.

Bukele has said he trades his country's Bitcoin on his phone. His first purchases were in September 2021, when Bitcoin was trading at around $52,000, according to the Nayib Bukele portfolio tracker website, and he has shown no particular fondness for market timing. His second largest purchase in Bitcoin was 420 BTC on October 27, 2021, when Bitcoin was trading at $60,345.

Due to market turmoil, El Salvador has further delayed its highly anticipated “volcano bonds” – which were scheduled to be issued by March 20 – at the grassroots level of the community Conchagua volcano.

However, some industry commentators believe the bottom could be near. Analysts at JPMorgan said in a note on Wednesday that the deleveraging that sparked the recent crypto frenzy may not last much longer, pointing to strong venture capital funding in the industry as a positive sign.

Chris Terry, board member and vice president of lending platform SmartFi, told Blockworks he sees a “weak bottom” in Bitcoin. “We may be forming a bottom in the $20,000 area,” he said.

"If Bitcoin had gone into the low teens, $12,000 to $14,000, I would feel better. That would be a bottom I could believe in."

Les Borsai, co-founder of Wave Financial, shared this view. “Most would-be sellers have already sold, and at that point you will be left with long-term holders and lots of interested buyers,” he said.

The President of El Salvador has signaled that he wants the nation to stick with its Bitcoin purchases. Finance Minister Alejandro Zelaya Concerns dismissed last month that Bitcoin's decline in value would affect the country's financial health, saying the risk was "extremely minimal."

Overall, the country's BTC portfolio is down by about $60 million or -57%.

. .

The post El Salvador Snaps Up $1.5M More Bitcoin, But Sits Heavily in the Red is not financial advice.