El Salvador Scoops $1 Million Worth of BTC Daily, Defying IMF Urging to Scale Back

El Salvador's Bitcoin strategy has been a topic of intense debate since the country became the first to adopt the cryptocurrency as legal tender in 2021. Despite criticism from international institutions like the International Monetary Fund (IMF), President Nayib Bukele has remained steadfast in his commitment to Bitcoin, with the country actively buying the dip and amassing a significant reserve.

On December 19, 2024, El Salvador purchased another 500 BTC, bringing its total reserves to 1,620 BTC, valued at approximately $50 million at the time. This purchase came just a day after the IMF urged the country to scale back its Bitcoin adoption, citing risks to financial stability. However, President Bukele has shown no signs of slowing down, continuing to buy Bitcoin during market downturns.

El Salvador's Bitcoin strategy has yielded impressive results. According to a tweet by President Bukele, the country's Bitcoin portfolio has seen a year-to-date gain of 117%, or $326 million, thanks to a Bitcoin investment that began in 2021. This profit highlights the potential of El Salvador's Bitcoin strategy, despite the IMF's concerns about fiscal and financial stability risks.

El Salvador's Bitcoin purchases have significantly impacted its international relations and reputation. The country's bold move to adopt Bitcoin as legal tender in 2021 drew criticism from international institutions like the IMF, which warned of financial stability risks. However, El Salvador's persistent Bitcoin buying, including a $15.3 million purchase on December 19, 2024, has demonstrated its commitment to cryptocurrency, positioning the country as a trailblazer in the crypto space.



El Salvador's Bitcoin strategy aligns with its economic goals and financial inclusion initiatives by promoting investment and fostering innovation. By becoming the first country to adopt Bitcoin as legal tender in 2021, El Salvador aimed to attract investment and promote financial inclusion. The country's Bitcoin purchases, totaling over $1 million worth of BTC daily, reflect its commitment to embracing cryptocurrency as a means of driving economic growth.

However, El Salvador's Bitcoin strategy also poses potential fiscal and financial stability risks. The IMF has warned of risks to financial stability, urging El Salvador to end its mandatory Bitcoin acceptance policy. Key concerns include volatility, regulatory uncertainty, and the potential for Bitcoin's value to plummet, leading to significant losses for the country. Additionally, the IMF recommends reducing the budget deficit, increasing reserves, and implementing anti-corruption measures to mitigate these risks.

In conclusion, El Salvador's Bitcoin strategy has yielded significant profits and positioned the country as a trailblazer in the crypto space. However, the strategy also poses potential fiscal and financial stability risks, which the IMF has urged the country to address. As El Salvador continues to buy the Bitcoin dip, it remains to be seen whether the country's commitment to cryptocurrency will pay off in the long run or lead to financial instability.