El Salvador’s Large losses in Bitcoin Brings it Closer With Bankruptcy

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El Salvador has cut its significant Bitcoin investments by about 50%, which translates into a potential loss of $52.4 million.

The government of El Salvador announced on Monday a proposal to buy back some of the government bonds maturing in 2023 and 2025.

The Central American country set a purchase price of $910 for bonds maturing in 2023 and a price of $540 for those maturing in 2025. Each bond has a total value of USD 800 million.

In July, when El Salvador’s President Nayib Bukele unveiled the buyback plan, it was seen as an attempt to address speculation about the country’s possible bankruptcy.

El Salvador is in the midst of strained relations with the traditional credit market, particularly following the decision to circulate Bitcoin as legal tender in September 2021.

Currently, El Salvador has cut its significant Bitcoin investments by about 50%, which translates to a potential loss of $52.4 million, according to CoinDesk data based on announcements by Bukele.

El Salvador’s $1 billion bitcoin bond (also known as the Volcano bond) still has no launch date, despite being announced in November 2021 by Bukele.

Bitfinex and Tether’s Chief Technology Officer Paolo Ardoino, who has worked closely with El Salvador on the Bitcoin bond project, reported last month that government officials told him to expect passage in September.

The bond buyback offer will be available between September 12 and 20, El Salvador said, adding that “the settlement of valid auctions and accepted notes is scheduled to take place around September 22.” Deutsche Bank Securities will be the dealer manager.

How much money has el salvador lost on bitcoin

According to a NY Times article, “The governmentโ€™s bitcoin holdings have lost about 60 percent of their presumed value during the recent market plunge. The use of bitcoin among Salvadorans has collapsed and the country is running out of cash after Mr. Bukele failed to raise fresh funds from cryptocurrency investors.”

According to the website https://nayibtracker.com/ this is how much money El Salvador has lost on bitcoin.

How much money has el salvador lost on bitcoin
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