Mar 28, 2024

El Salvador’s President Updates on “1 Bitcoin a Day” Program

El Salvador continues to solidify its status as a global leader in cryptocurrency adoption,particularly with bitcoin (BTC), as it strategically strengthens its position in the digital currencymarket. President Nayib Bukele recently provided an update on El Salvador’s bold “1 bitcoin aday” program, an initiative that started on 18 November 2022. This program involves ElSalvador’s daily…

El Salvador continues to solidify its status as a global leader in cryptocurrency adoption,
particularly with bitcoin (BTC), as it strategically strengthens its position in the digital currency
market. President Nayib Bukele recently provided an update on El Salvador’s bold “1 bitcoin a
day” program, an initiative that started on 18 November 2022. This program involves El
Salvador’s daily purchase of one bitcoin and will persist “until bitcoin becomes unaffordable
with fiat currencies,” as Bukele shared on social media platform X.

The “1 bitcoin a day program” has been instrumental in propelling the nation’s bitcoin holdings
to an impressive total of 5,690 BTC, valued at approximately $400 million. This strategic
accumulation of bitcoin aligns with El Salvador’s commitment to embracing digital currencies
and harnessing their potential for economic growth.

In conjunction with its cryptocurrency initiatives, El Salvador has taken a bold step on the
international investment stage by eliminating income tax for foreign investments and
cross-border money transfers. This reduction from a hefty 30% to 0% is a calculated maneuver
aimed at attracting foreign investors and stimulating economic growth.

A significant development came on Thursday when President Bukele disclosed that El Salvador
has decided to transfer a substantial portion of its bitcoin holdings to a cold wallet, securely
stored in a physical vault within the country’s territory. This move towards safeguarding digital
assets in a cold wallet marks a major advancement in El Salvador’s financial strategy, ensuring
heightened security and demonstrating a strong belief in the cryptocurrency’s future.

This decision to transfer the funds to a cold wallet followed an unexpected surge in El Salvador’s
bitcoin treasury, nearly doubling its previously reported holdings. The country has been
accumulating bitcoin through various channels, including daily purchases, passport sales,
currency conversions for businesses, mining activities, and government services. This
multi-faceted approach has significantly bolstered El Salvador’s bitcoin reserves, which were
estimated to be below 3,000 BTC before this revelation.

El Salvador’s journey with bitcoin began in September 2021 when it made history by becoming
the first country to adopt bitcoin as legal tender alongside the U.S. dollar, despite warnings from
the International Monetary Fund (IMF). Since then, the country has been acquiring bitcoin
through various means, including purchases and mining, generating revenue from
bitcoin-related initiatives.

Venture capitalist Tim Draper believes that bitcoin will transform El Salvador into one of the
wealthiest nations in the world. President Bukele shares this vision, envisioning a prosperous
future for El Salvador through strategic investments and initiatives tied to the digital currency.
Despite critiques and cautions from international entities such as the IMF, El Salvador remains
resolute in its bitcoin strategy, showing no indications of wavering from its cryptocurrency
stance.

El Salvador’s confident entry into bitcoin and its efforts to create an accommodating
environment for crypto investments mark a significant shift in how nations perceive and engage
with digital currencies. As the country continues its bitcoin acquisition program and enhances
its cryptocurrency infrastructure, it sets an example for others to follow, potentially reshaping
the global financial landscape in the process.

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