SAN SALVADOR, El Salvador — With bitcoin hitting unprecedented levels and exceeding $100,000 for the first time, President Nayib Bukele expressed his satisfaction on Thursday regarding his gamble on the cryptocurrency.
Since El Salvador recognized bitcoin as legal tender in 2021, its adoption has not been as robust as the president had hoped. Nevertheless, the government’s investment in bitcoin has now reportedly surpassed $600 million.
The significant uptick in bitcoin’s value follows the recent election win of Donald Trump, and the cryptocurrency reached the landmark price on Wednesday evening, just hours after Trump announced his intention to appoint cryptocurrency supporter Paul Atkins as the next chair of the Securities and Exchange Commission.
However, by Thursday afternoon, bitcoin’s value had dipped back below the $100,000 mark, trading just over $99,000 around 3 p.m. E.T.
On Thursday, Bukele attributed the missed opportunities from the bitcoin surge to his political opponents, suggesting their efforts had hindered many Salvadorans from benefitting from the cryptocurrency boom.
When Congress legislated the use of bitcoin as legal tender in June 2021, widespread protests erupted — although discontent was not solely focused on this decision.
Historically, El Salvador has utilized the dollar as its official currency, but Bukele has highlighted the potential of bitcoin to unlock new financial opportunities for the unbanked population and eliminate service fees for international remittances sent by Salvadorans abroad. To incentivize digital wallet adoption, the government provided $30 in bitcoin to new sign-ups.
While many took advantage of this opportunity, most swiftly converted their bitcoin into cash.
“It’s important to emphasize that the opposition not only made mistakes regarding bitcoin but that their stance impacted many lives this time around,” Bukele posted on Facebook.
On social media platform X, Elon Musk made a notable comment supporting Bukele on Thursday.
Former Central Bank President Carlos Acevedo remarked that although the government has seen gains from its bitcoin investments, these gains are unrealized until the cryptocurrency is sold. He acknowledged Bukele’s administration for navigating the bitcoin integration skillfully, especially with Trump now in power.
Acevedo attributed bitcoin’s recent sustained growth to the market’s optimism regarding a Trump presidency that would likely favor financial markets, specifically emphasizing bitcoin.
Despite the gains, he warned of the inherent volatility that persists within the cryptocurrency.
“The average citizen in El Salvador does not commonly engage with bitcoin; however, there are affluent individuals already invested in it, albeit in small numbers,” Acevedo noted.
Esteban Escamilla, a clothing store employee in Santa Tecla, near the capital, shared that he had exchanged the initial $30 of bitcoin offered in 2021.
“I don’t use bitcoin since I can’t afford to speculate,” he explained, while recognizing that he could have significantly increased his wealth had he retained his bitcoin holdings.
Josefa Torres, a 45-year-old shopper, confirmed her lack of bitcoin holdings, stating, “I withdrew the money and used it for daily expenses,” during her trip to the grocery store.
Following discussions in August between the International Monetary Fund (IMF) and El Salvador’s government, the IMF released a statement regarding the country’s bitcoin assets, indicating that there is an understanding of the need for improved transparency and measures to mitigate any fiscal or financial stability risks connected to the Bitcoin initiative.
