[NEWS] El Salvador sees unrealized gains of about 500 million yen due to Bitcoin surge; could this affect the presidential election?

On the 4th, El Salvador's President Nayib Bukele announced the country's profits from Bitcoin investments, following the price of the cryptocurrency Bitcoin (BTC) soaring to $42,000 (approximately JPY 6.18 million).

President Bukele said, "At the current market price of Bitcoin, if you sell it, not only will you recover 100% of your investment, but you will also make a profit of approximately $3.62 million (approximately JPY 530 million)."

El Salvador has designated Bitcoin as legal tender and is investing national funds in Bitcoin. The background to this is the desire to break away from dependence on the US dollar, which is the other legal tender. Against this background, El Salvador has launched a smart city initiative using Bitcoin.

Although this announcement is a short-term price fluctuation, it shows President Bukele's belief that "Bitcoin is suitable as a long-term national asset for El Salvador."

He said on X (formerly Twitter) that "El Salvador's Bitcoin investment has turned a profit. There have been thousands of articles and criticisms mocking our expected losses. All of them are based only on the market price of Bitcoin at the time."

President Bukele also claimed in his post that he "has no intention to sell (Bitcoin)," adding, "I am fully aware that the price will continue to fluctuate in the future. This does not affect our country's long-term strategy."

President Bukele also showed El Salvador's portfolio and reported that he currently holds about $130.88 million (about 19.2 billion yen) worth of Bitcoin. According to the portfolio, El Salvador has made a 2.84% profit on its Bitcoin investment to date.

Since first investing in Bitcoin in October 2021, El Salvador has increased its purchases several times. In November last year, he expressed his intention to buy 1 BTC of Bitcoin every day after the cryptocurrency exchange FTX collapsed and Bitcoin prices fell.

Aware of the presidential election to be held in February next year

While a bullish Bitcoin market is currently expected, El Salvador is preparing for a presidential election in February next year. President Bukele is seeking reelection, and the success of his Bitcoin investment strategy in garnering support could be a factor in determining the outcome of the election.

President Bukele argues that "It is important for the naysayers to retract their statements. At the very least, they have repeatedly pointed out that we are suffering losses, and they need to take responsibility and retract or apologize. Either way, El Salvador will have to admit that it is currently making profits."

El Salvador is known as a country that has actively introduced Bitcoin, and a similar movement may be seen in Argentina, where the presidential election was held recently.

Bavier Mirell, who was elected as the new president of Argentina, has proposed bold policies such as abolishing the central bank in order to break away from the record inflation in the country. Among these, he has recommended that cryptocurrencies such as Bitcoin be designated as legal tender, and some movement may be seen as early as immediately after taking office.

Reference:Announcement
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