The market hasn’t been playing out as many investors had hoped for September. Bitcoin is still in a range after being rejected from 50.000 US-Dollars and is testing the lows of this range again. However, there is one place in this world where at least the government is not afraid of the possibility that the Bitcoin price might fall even lower.
How is El Salvador developing its Bitcoin strategy, and why this is potentially a good thing for the small country?
Chivo has been rolled out
At the beginning of September, El Salvador experienced the rollout of Chivo, the country’s own Bitcoin wallet that allows Salvadorans to swap between BTC and USD without any costs. Over 200 locations were opened across the country, most equipped with ATMs, allowing a seamless swap between both currencies.
But that’s not all that was happening in the last couple of weeks. BTC got rejected at 50.000 US-Dollar on the very same day Chivo started. While many media outlets reported that this is probably a bad sign, El Salvador’s President Nayib Bukele remained bullish despite the harsh drop that followed.
Bukele simply saw an opportunity to buy Bitcoin in response to the market reaction, and the small country owns a lot of it. At that time, El Salvador held 550 BTC after buying the dips in early September.
Bukele strikes again
Today’s dip was apparently perceived as an opportunity by Bukele since he announced via Twitter that El Salvador bought another 150 BTC. With a total of 700 Bitcoin, a significant amount of money has been invested.
While 31 million Dollars in Bitcoin doesn’t sound like a considerable investment for a country, we need to keep in mind that El Salvador is one of the poorest countries in the world. Critics and the political opposition in the country have condemned the monetary policy, pointing out that Bukele is putting the country in jeopardy investing in such a volatile and risky asset.
Even with the pressure from the IMF and US officials, Bukele seems to be steadfast and 100% sure that he will be on the right side of history. Bitcoiners are bullish on the moves of Bukele and El Salvador, but it remains completely open how this is going to play out.
Alas, one person on this planet is even more bullish than Bukele and who is buying even more Bitcoin. It was only last week that Michael Saylor announced that MicroStrategy bought more than 5.000 BTC.
With Bukele and Saylor racing to scoop up cheap Bitcoin, will there be enough left for the rest of humankind? At least the statistics show that October is usually going particularly well for Bitcoin. Perhaps they are both right.