El Salvador will start the new Bitcoin movement from November 18. El Salvador’s decision to buy one bitcoin per day comes at a time when the country is experiencing a lot of financial uncertainty.
In the latest development, El Salvador’s Nayib Bukele has announced that he will resume buying Bitcoin again. In a recent tweet, President Nayib Bukele wrote, “We are buying one bitcoin every day starting tomorrow.” However, he did not suggest how long they would continue this buying program. Salvadoran bitcoin law began last year on September 7, 2021. The country has received almost $ 375 million bitcoins, but it remains at more than $ 60 million without book losses.
President Nayib Bukele is a big supporter of Bitcoin and believes that crypto will be good for the country’s financial health. Also, it went against all odds for their Bitcoin bets despite repeated warnings from the IMF and the World Bank to withdraw from their Bitcoin bets. The drop in BTC price last year was really a loss for El Salvador. The revelation of the FTX event in the past week has also put BTC under selling pressure. But it seems President Nayib Bukele has gained enough confidence to bet long on buying Bitcoin again.
El Salvador and Axis China
In addition to acquiring bitcoins, President Nayib Bukele has worked to create a comprehensive infrastructure of the bitcoin economy. He also shared plans for floating Bitcoin Volcanic Bonds and establishing a Bitcoin City that has yet to come to fruition.
Although President Bukele has relied on the volcanic chain of Bitcoin payments to pay his country’s debt, things have not turned in his hands so far. Salvadoran economist Luis Membraño said:
“If Bukele dreamed that he could create a different and innovative political economy, against the advice of the IMF, that dream has failed. There are no easy alternatives, no short-cuts.”
Because of its massive Bitcoin strategy, every rating agency downgraded El Salvador’s line of credit. Rating agency Fitch expects the country to default on its debt next January. On the other hand, rising interest rates, rising inflation and rising fiscal conditions may harm the country’s economy further.
Economist Membraño said El Salvador could fall into China’s financial axis by asking for debt relief. “It will represent a change in Salvadoran foreign policy,” he said.
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