Hey guys, we are sure that you have heard the name of the Latin American country, El Salvador even once, right? Well, why wouldn’t you, it was the first country in history to make Bitcoin a legal tender and it is again back all over the news. However, this time for all the wrong reasons.
It is believed that the government had spent around $103 million of the citizen’s tax money to build a Bitcoin treasury which is now dropped down to $66 million after the recent market dip. In simple words, $37 million was almost instantly wiped out from the country’s reserves. Quite concerning right?
Various experts including the US officials and IMF had already voiced their worries regarding El Salvador’s decision of making a volatile asset such as Bitcoin a legal tender in past. Plus, what is more concerning is that the President Nayib Bukele once Tweeted that he most of the times does the purchases via his phone and that too when he is at the toilet. Again this is quite concerning, especially when the Tweets are coming from the President of the country using the country’s funds to buy a super volatile asset and plus giving of an irresponsible vibe.
Well, even after the country’s Bitcoin reserves are down by $37 million, it seems that the President wasn’t concerned about this at all as he again recently ended up buying the dip by buying 500 Bitcoins that roughly amounted to $15.3 million.
Well, what’s even more concerning is that the necessary info regarding how El Salvador is managing it’s Bitcoin holdings, who owns the private key to the country’s Bitcoin reserves wallet and how the public’s money is being used for the President’s grand Bitcoin project plan is still in the shadows. In simple words, the public is totally left in the dark regarding such a crucial matter of how their tax money are being used.
Various local media houses even reported back then during the initial days of the Bitcoin legal tender adoption law that many prominent protesters against the government were illegally snuffed out or silenced by threatening them with dire consequences if they would continue their protests. Yup, you read these lines right, this did happen. Further, a shadowban was imposed overall on media houses that were found to be covering and broadcasting the protest or riots against the then-new Bitcoin legal tender norm. In short, it was believed by many that the Bitcoin legal tender law was mostly forced upon the citizens rather than being accepted happily.
My Take On The Matter
Well, the oddest part about the whole matter is the government’s current stance on how it is handling the whole ordeal without even officially sharing the necessary details with the very citizens whose tax money is being used to back this whole thing up. Another major concern is who holds the private keys to the entire Bitcoin reserve wallet of the country? Further, how is the government managing the country’s economy which is directly linked to the volatile price movement of Bitcoin, especially when the President claims that he buys Bitcoin for the country from his phone and that too from the toilet? Hence, another grave question arises of whether he is being responsible or not and further, is he consulting an expert panel before buying Bitcoin or not?
Well, there are a lot of similar questions in mind to which there aren’t any answers yet. It is true that Bitcoin indeed solves a lot of problems which the traditional financial system has and this risky move by El Salvador could put it in front of the race to the major solution of inflation and also get financial freedom once and for all, etc. However, I also believe that the government should be more transparent in its approach rather than keeping its citizen’s in the dark which would only end up creating more unrest.
That will be all for now folks. Make sure to subscribe to our newsletter to receive weekly updates on all kinds of interesting topics.