Even as bitcoin plunged below $40,000 this past weekend, the country of El Salvador bought more of the leading cryptocurrency amid the sell-off.
El Salvador, the first country to accept bitcoin as legal tender, purchased 410 bitcoin ($15 million) last Friday, based on a Forbes report. While the rest of the cryptocurrency markets were primarily seeing red, El Salvador saw the opportunity as a red tag sale.
The country’s president, Nayib Bukele, took to Twitter to announce the purchase on the dip. Meanwhile, bitcoin has fallen to a six-month low, allowing value-focused investors to come in and buy the leading cryptocurrency at a price that’s almost half its all-time high from last November.
With last Friday’s purchase, El Salvador now holds just over 1,800 bitcoin. That equates to about $66 million, according to a Bloomberg report.
El Salvador has been one of the countries in the forefront looking to capitalize on the cryptocurrency craze. Bukele’s consistent purchases on the dip underscore the president’s belief that bitcoin can help foster economic growth within the country, which was the basis of the unpopular decision of adopting bitcoin as legal tender.
“Though it made Bukele a hero in the crypto community, El Salvador’s adoption of bitcoin as legal tender provoked widespread protests by Salvadorans who complained that the decision made things harder on regular people while benefiting big investors,” Forbes reports.
Whether bitcoin can ease El Salvador’s economic woes remains to be seen. The recent drop in cryptocurrencies isn’t doing any favors at the moment.
“Meanwhile, El Salvador’s national debt has ballooned to over 50% of its GDP,” the Forbes report adds. “In July, Moody’s downgraded the nation’s credit rating to Caa1, signifying very high credit risk. El Salvador’s bitcoin trades add to the nation’s credit risk, Moody’s said. El Salvador is seeking a $1.3 billion loan from the International Monetary Fund, which had warned against adopting bitcoin as a national currency.”
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