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As the first country in the world to adopt Bitcoin (BTC) as legal tender in September 2021, El Salvador has returned to buying BTC just days after pausing for months amid bearish market conditions.
El Salvador President Nayib Bukele announced on November 16th that the Central American country will start buying BTC daily from November 17th. The announcement comes almost three months after the country made its last BTC purchase in July 2022.
i am buying one #bitcoin Every day from tomorrow.
Nayib Bukele (@nayibbukele) November 17, 2022
El Salvador began buying BTC in September 2021, shortly after making it legal tender. At the time, BTC was in the midst of a bull market, with prices hitting all-time highs every other week, so all the purchases made by the country looked lucrative. However, with the arrival of a bear market by the second quarter of 2022, his BTC purchases in the early days of El Salvador began to look like a gamble and suffered heavy losses.
According to public records, El Salvador currently holds 2,381 BTC with an average purchase price of $43,357. So the country has spent about $103.23 million on buying BTC, and the same BTC is currently worth $39.4 million.
The announcement of a new BTC buying routine could help El Salvador offset some of its losses in the coming months at a time when the best cryptocurrencies are trading at new cycle lows.
Looking beyond the losses small nations have incurred in buying BTC, the top cryptocurrency has helped significantly reduce cross-border transfer costs, giving a boost to the tourism sector as well.
Related: Bitcoin Decision in El Salvador: Tracking Adoption After One Year
Cointelegraph reporter Joe Hall is currently on the ground in El Salvador, surviving on Bitcoin alone. According to an early update from Hall, BTC is being accepted in most tourist attractions, but his mobile applications and services need further refinement.
Lunch at El Navegante
giant sign: #bitcoin Accepted here
the waiter is @attack T-shirt, chef wears strike hat (srsly).
Tried to pay the bill. The waiter looks for PoS for her 15 minutes.
He gets his neighbor to activate Chivo so I can pay pic.twitter.com/9HaHG8qclQ
Joe Nakamoto (@JoeNakamoto) November 14, 2022
BTC adoption in El Salvador may not look very promising at the moment due to the harsh crypto winter. However, if we look at Bitcoin’s price cycle history, countries can easily offset their losses in the next bull cycle simply by maintaining Bitcoin purchases.
