El Salvadoran authorities have been buying bitcoins for the country’s reserves since 6 September 2021. That’s when the country’s president, Nayib Bukele, announced the purchase of the first 200 bitcoins.

Since then, the accumulation has tentatively reached the mark of 5,858 bitcoins, equivalent to $336 million as of today. This amount is 35 per cent higher than what the government has invested in BTC purchases.

Bitcoin purchases by El Salvador authorities on a chart of the cryptocurrency

However, this figure is indicative. Firstly, the process of buying bitcoins is not transparent, so it is impossible to check all the details of transactions here.

Secondly, on 18 November 2022, Bukele published a tweet promising to buy 1 BTC every day. Since then, the authority should have purchased 653 bitcoins worth $25.8 million. However, whether this has been done is unknown.

How Bitcoin is used around the world

The process of adopting the first cryptocurrency in El Salvador has generally been slower than predicted. However, there is a silver lining to everything, Bukele believes. Here’s his quote from the interview.

Bitcoin has not had the widespread adoption that we had hoped for. The positive aspect is that its popularisation is voluntary – we have never forced anyone to accept cryptocurrency.


Such an advantage sounds dubious, because in fact Bitcoin was recognised as the official currency in El Salvador without the participation of ordinary people. The situation is more like the authorities failed to explain the benefits of digital assets to ordinary citizens. Or the latter have no interest in investing, which is also a bad sign.


President Nayib Bukele of El Salvador

In 2021, President Bukele announced that Bitcoin will be considered legal tender on par with the US dollar. This policy means that businesses are obliged to accept cryptocurrency from customers if they have the capacity to do so.

The eccentric leader also issued a decree to form a national crypto reserve in Bitcoin. The Salvadoran government has started acquiring BTC in regular rounds of transactions.

There were even protests against the adoption of Bitcoin in the country

Last year, Decrypt journalists visited the country to assess the Bitcoin adoption process.

Overall, the adoption of the cryptocurrency was indeed slow. Contrary to official laws, many retail outlets simply did not accept crypto yet, and the only exceptions were large franchises like McDonald’s. At the same time, ordinary Salvadorans were indifferent to Bitcoin, which is generally true for any country.

The actions of the Salvadoran government were criticised by both politicians in the US and officials from the International Monetary Fund. Yet their words have not stopped Buquela from introducing a number of policy reforms aimed at developing the local cryptosphere. Here is the president’s rejoinder on the matter.

It has given us branding, it has brought us investment, it has brought us tourism. I believe the positives outweigh the negatives and the problems that have been highlighted are relatively minor.

Now Nayib Bukele says Salvadorans have a chance to keep an asset that could be a real bailout for their savings. As a reminder, the government gifted the country’s citizens $30 each in BTC back in 2021.

Bukele commented on this situation as well. The replica is cited by Coindesk.

If Salvadorans start using it now, they will surely profit in the future. If they don’t want to use it, however, it’s a free country. I expected a greater spread, certainly, but we have always prided ourselves on being a free country – free in every way.

Mentions of Bitcoin by businesses from El Salvador

Bukele also recalled that El Salvador was a “pioneer” in a completely new field, well today many Wall Street companies offer investment products directly related to Bitcoin.


Note that digital assets are extremely popular in countries with weak economies and high inflation. Still, they allow people to protect their own savings from depreciation in local currency. Although this is primarily true for stablecoins like USDT and USDC.

And even though Bitcoin is up 34 per cent since the beginning of the year, it is still quite a volatile asset. For example, BTC has depreciated by 8 percent in the last week, and this kind of cryptocurrency behaviour may not suit everyone.


Bitcoin and the dollar struggle


Apparently, Bitcoin's popularity in El Salvador leaves much to be desired, but this is not surprising. First of all, the cryptocurrency was recognised as the country's official currency two months before its exchange rate reached an all-time high on that bullrun, after which the coin went into decline - and this could have had a bad effect on the asset's reputation in the eyes of locals. In addition, stablecoins, rather than BTC, are better suited for preserving asset value.