As Bitcoin reached historic highs, surpassing US$100,000 for the first time, El Salvador’s President Nayib Bukele was triumphant about his significant investment in the cryptocurrency. The adoption of Bitcoin as legal tender in El Salvador since 2021 has been a controversial move, but it has now resulted in the government’s reported investment exceeding US$600 million.
Bitcoin's impressive rally followed the recent political landscape shift, particularly after Donald Trump's election victory, which contributed to the surge in value. This milestone was reached just hours after Trump announced his intention to nominate Paul Atkins, a known advocate for cryptocurrency, as the next chair of the Securities and Exchange Commission.
Image: A bitcoin symbol is on an LED screen during the closing ceremony of a congress for cryptocurrency investors in Santa Maria Mizata, El Salvador in 2021. Photo: AP
However, just two years ago, Bitcoin's value was volatile, dropping below US$17,000. As of Thursday afternoon, it fell back below US$100,000, resting just above US$99,000. Bukele criticized his political opposition for causing many Salvadorans to miss out on potential gains from Bitcoin's rise. The legal tender decision faced public protests in June 2021, fueled by concerns over the economic implications and the use of the US dollar as the primary currency.
Bukele has promoted Bitcoin as a means to provide new opportunities for the unbanked population in El Salvador and to reduce costs associated with remittances sent home by Salvadorans living abroad. To encourage adoption, the government incentivized citizens with US$30 in Bitcoin for signing up for digital wallets, although many opted to cash out soon after.
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