El Salvador celebrate 21st of December 21 with 21 Bitcoin

[Wiwo]

I've always wondered how that hospital is going to be built from the profits of investing in BTC while no bitcoin will be actually sold.

I believe they are going to sell $1 billion bitcoin backed bonds without actually selling any bitcoin!

And what profits when at least 200 coins were bought at $52k and 100 at $54k?
I'm starting to think that rather than buying the dip he is actually licking the tip lately.

Has anyone gathered all the prices they made their purchases to see if the result is profit or loss? For example 150BTC was bought at $48,670.
$52k-$54k is hardly the tip though, when the price went to $70k and is currently at $48k-$49k.

Their goal may not be a short-term base as most people still consider 60k Bitcoin price as a low price considering how long they intend to hold their Bitcoin, so El Salvador may decide to buy at whatever price at the moment.

[pushups44]

El Salvador president does not have a good financial advisor that truly understands the working of the cryptocurrency market and that is the reason he always purchases Bitcoin at pick price, what have they been doing in the last week when the price was around 40k or above why waiting until it reaches 50k before buying each time. Anyways it is a good move but for a long time base.

I am very much sure he is using public money to buy these bitcoin. The GDP of El Salvador is 24 billion USD and GDP growth rate was -8.5% in 2020 according to world bank (source). With such economic indicators I don't think its a good move to add bitcoin in national portfolio by using public money. If there president is doing this with his own money then its non of our business.

Wikipedia indicates that Bukele will remain President of El Salvador until June 2024, approximately around the time of the next halving event. I think he will be comfortable waiting for the price to explode at some point during his tenure. If it does, he will be known as one of the boldest, shrewdest, and most remarkable Latin American politicians of all time. Michael Saylor of Microstrategy is making a similar bet, albeit in a corporate capacity.

[stompix]

I've always wondered how that hospital is going to be built from the profits of investing in BTC while no bitcoin will be actually sold.

I believe they are going to sell $1 billion bitcoin backed bonds without actually selling any bitcoin!

The bonds are one thing and that is another mess altogether
They claim to sell one million bonds and use half of the funds to build a city that is going to cost 17 billion, which is another magic trick that only Bukele knows how to perform. As for the hospital that is currently being constructed he clearly said it's going to be paid from the profits from BTC so how has he realized 4 million in profits?

Has anyone gathered all the prices they made their purchases to see if the result is profit or loss? For example 150BTC was bought at $48,670.
$52k-$54k is hardly the tip though, when price went to $70k and is currently at $48k-$49k.

It doesn't matter where the ATH was, it matters where he bought it, and wow, what a surprise, the only clue for these are his tweets.
His lowest buying point would be 46k if we would go by his tweets with a 200 bitcoin purchase, that barely negates the other buys and there is no way you could pull 4 million in profits from this tiny spread when he claimed he started construction unless he sold at the tip.
But we will never know as there is no actual proof of anything other that tweets, they could hold now 100 000 coins or 21 or none, there isn't a single official number coming from an official document, not about the purchases, the money spent, the number of transactions on Chivo, the number of funds circulating there, the amount of hash rate they have in their mining operation, nothing expect an avalanche of laser eyes.

It seems a lot are cheering for Nayib and his country when they adopted Bitcoin as a legal tender, purchased during the dip, made profit from it, responded with resistance to the IMF and the US in an unfriendly tone

Yeah, unfortunately, propaganda is one thing, reality is another:

Critics ask IMF to block financing for El Salvador

Bukele has requested $1.3 billion in IMF financing, which he intends to use in building a new airport and a Pacific train line.
Bukele quickly took to Twitter, his favorite platform, to criticize the call by the business group and the José Simeón Cañas University.
“They want to return to governing our country, or bankrupt it. And our people? They don’t matter, ” Bukele wrote, noting the university and business group had previously been on opposite sides of the political spectrum.

IMF Executive Board Approves a US$389 Million Disbursement to El Salvador

The IMF approved El Salvador’s request for emergency financial assistance of about US$389 million under the Rapid Financing Instrument to combat the COVID-19 pandemic.

Asking for billions in loans is probably the new way of resisting, who knows.

[pooya87]

Their goal may not be a short-term base as most people still consider 60k Bitcoin price as a low price considering how long they intend to hold their Bitcoin, so El Salvador may decide to buy at whatever price at the moment.

That's definitely correct. In some news articles I have read some 5 year plans. For example they are building Bitcoin City and a lot of other infrastructure that won't even be completed in short term.
Besides El Salvador is among the poor countries but about $60 million in bitcoin for a country with $25 billion GDP (0.24%) doesn't look that big to be honest.

In any case this is a very exciting experiment to watch over the coming years and see how this poor country is going to be like in like 5 to 10 years from now. This could provide good information for other countries with bigger and better economy to decide whether they want to start adding bitcoin to their reserves.

[buwaytress]

Don't want to be the wet blanket but it's really the El Salvador government celebrating though, not the people.

I think the actual Bitcoiners will look with envy at some of their (not immediate) neighbours. Supermarkets in Mexico and in Venezuela are accepting Bitcoin for a hefty discount. Places scattered over Argentina as well, and advocates moving all around the country teaching people and educating.

Not saying one way is better than the other, just that one way comes from grassroots action, the other viewed as another decision pushed down people's throats.

Oh damn, didn't mean to start my day so negative haha.

[virasog]

As buying Bitcoin have become a wayy the El Salvador government celebrate different days, the latest was the buying of 21 Bitcoin at the price of $49,000 which dollars equivalent is $1,036,000 just to celebrate the last 21st day of the year 21.
This have brought the country total Bitcoin holding to 21,041 Bitcoins this moves have set El Salvador an hedge over other counterparts.

People don't realize this but El Salvador will soon become the rishest country of the world. Think in a way that they are holding over 20,000 bitcoins and if each bitcoin reaches over 100k, thier county reserve will be doubled.

[DdmrDdmr]

<…> I've always wondered how that hospital is going to be built from the profits of investing in BTC while no bitcoin will be actually sold. <…>

By playing along dangerously with the numbers, in a manner similar to fable the milkmaid and her pail:

When he announced the Pet Hospital back in October, he twitted an explanation on where the funds were coming from. The tweet (see https://twitter.com/nayibbukele/status/1447017312893161478 and scroll down) is in Spanish, so I‘ll summarize the core parts in English (freely translated, with my minor added comments):

FIDEBITCOIN (the Bitcoin Trust) has, by law, an allocated amount in USD.
Nevertheless, its balance sheet bears both USD and BTC [the latter derived from the purchases].
<…>
The Trust is now worth more than the allocated figure, due to the rise in price of BTC, rendering FIDEBITCOIN with a "surplus" of 4M $ [theoretical on the books, and forever changing with BTC price fluctuation].

Therefore, the government made company, Chivo, can dispose of 4M $ [October 2021 numbers], without affecting the Trust’s allocation.
This is carried out by keeping the same amount of BTC, and reducing the amount of USD. We can therefore invest 4M $ in some project.

So we decided to invest part of that money in a Pet Hospital.
<…>

There we go, the perfect potential example of the former part of to fable the milkmaid and her pail. While BTC goes up, they extract USD from the trust, keeping the book value of the Trust near the legal allocated value. The problem is, that BTC could go down, and activate the second part of the fable …

[rodskee]

As they have adopted Bitcoin literally then this must be a normal occasion in their part though 21 bitcoin is a good one time Buying .

El Salvador will continue this Journey as they know how long will this be beneficial in  their part.

As buying Bitcoin have become a wayy the El Salvador government celebrate different days, the latest was the buying of 21 Bitcoin at the price of $49,000 which dollars equivalent is $1,036,000 just to celebrate the last 21st day of the year 21.
This have brought the country total Bitcoin holding to 21,041 Bitcoins this moves have set El Salvador an hedge over other counterparts.

People don't realize this but El Salvador will soon become the rishest country of the world. Think in a way that they are holding over 20,000 bitcoins and if each bitcoin reaches over 100k, thier county reserve will be doubled.

That is a Big number to consider ..

[blatchcorn]

It seems a lot are cheering for Nayib and his country when they adopted Bitcoin as a legal tender, purchased during the dip, made profit from it, responded with resistance to the IMF and the US in an unfriendly tone, made use of volcanic energy to mine Bitcoin, and so on. But since the price has fallen down, criticisms are now hurled at him.

I haven't been a fan of El Salvador risking the people's money on something that is volatile. But the failure of El Salvador in its Bitcoin ventures is probably going to be interpreted by critics as the failure of Bitcoin. I hope El Salvador succeeds.

I don't think this move is about success or failure of Bitcoin. Bitcoin financial system is live for one decade and without support of any big economic power bitcoin mange to hit 65K$. Even if El Salvador withdraw its decision on bitcoin legal tender even then bitcoin wont be affected. Can you see any change in bitcoin price since the El Salvador announces its decision of using it as legal tender?

[stompix]

People don't realize this but El Salvador will soon become the rishest country of the world. Think in a way that they are holding over 20,000 bitcoins and if each bitcoin reaches over 100k, thier county reserve will be doubled.

Read my reply, the 3rd message, it's actually 1200 coins and they would need to gain $150k in price each year just to cover the annual aid Salvador receives from the US for regional and humanitarian assistance.
In order for Salvador to become the richest country in the world they would need to buy 1 million bitcoins and each of those to be worth 126 million because that's the total wealth, the richest country has right now, 126 trillion.

There we go, the perfect potential example of the former part of to fable the milkmaid and her pail. While BTC goes up, they extract USD from the trust, keeping the book value of the Trust near the legal allocated value. The problem is, that BTC could go down, and activate the second part of the fable …

I said before, once he started throwing projects after projects it turned from a nice step forward that would trigger adoption to a race on who will be the first to land in prison with these schemes. Now, if he would be using those gains from the trust fund to buy more coins, which would raise the value of the trust allowing him to buy more coins, I have a feeling this is going to turn into a fractional reserve scenario.
As much as I dislike this guy and his schemes, unfortunately now I have to actually hope this house of cards will not collapse, with so much attention he has drawn from the media if this goes bust every single one of us is going to get a free colonoscopy from the fallout.

[teosanru]

I think El Salvador is becoming like an example for the rest of the world that how can you manage your economy by creating crypto currency a legal tender, many people even including me had argued that it's impossible to have bitcoin as a legal tender as you will always be under a chance of loss due to fall of value, but El Salvador have handled everything very intelligently and are hedging their positions very nicely.

There is no "loss" unless you sell or buy something with it. The way you deal with money that doesn't lose value over time, is to hold your buys of unnecesary things when its "down". Simply that, save more when its down.

A few online games let you experiment this kind of economy (if the devs are not intervening like some govs do), what people do is save until they can purchase things, since there is no danger of their purchasing power plummeting overnight, which is what makes people go desperate getting loans in the first place.

So turn around your mindset, and go from the debt economy to the savings economy. Read authors from the Austrian school of economy, there lies the answer of how the world will work with this kind of money, everyone else is afraid of from their decades of dogma because they need inflation to force people get in loans, yadda yadda. Bubbles and crashes distorted markets that act on falsehoods.

Thanks to bitcoin, this current dominating trend will slowly end, and El Salvador is paving the way, so kudos to them, they deserve to reap the profits from taking this bold action others, better informed, were too afraid to do...

Well looks like you have been quite involved in studying the deflationary economy, would love to know from you that how you intend to solve the problem of the deflationary spiral in a deflation-based economy? If I know my purchasing power would improve tomorrow, wouldn't I just defer my purchase to tomorrow every time? Basically deferring the overall economic production too, moreover, people would eventually stop spending on their "wants", will only spend on their needs. So if in such an economy, where everyone is just "Saving" and not Investing, how will economic growth take place?

[Coin_trader]

It seems a lot are cheering for Nayib and his country when they adopted Bitcoin as a legal tender, purchased during the dip, made profit from it, responded with resistance to the IMF and the US in an unfriendly tone, made use of volcanic energy to mine Bitcoin, and so on. But since the price has fallen down, criticisms are now hurled at him.

I haven't been a fan of El Salvador risking the people's money on something that is volatile. But the failure of El Salvador in its Bitcoin ventures is probably going to be interpreted by critics as the failure of Bitcoin. I hope El Salvador succeeds.

I don't think this move is about success or failure of Bitcoin. Bitcoin financial system is live for one decade and without support of any big economic power bitcoin mange to hit 65K$. Even if El Salvador withdraw its decision on bitcoin legal tender even then bitcoin wont be affected. Can you see any change in bitcoin price since the El Salvador announces its decision of using it as legal tender?

Yes its that Bitcoin exist in decade but that 65K$ is only attain within a period of 1.5 years after this whales like El Salvador, Microstrategy and Grayscale appear and start accumulating huge chunk of Bitcoin. The price will gonna reach this high if this big player didn't enter. Its still a good thing that there's already a real reason why Bitcoin price pump compared before that pure speculation  and price is on bubble. So let's not take away the credits from big players especially El Salvador.

You will not gonna like what will happened next if this whales starts to take profit and produced a chain reaction.

[Wiwo]

Their goal may not be a short-term base as most people still consider 60k Bitcoin price as a low price considering how long they intend to hold their Bitcoin, so El Salvador may decide to buy at whatever price at the moment.

That's definitely correct. In some news articles I have read some 5 year plans. For example they are building Bitcoin City and a lot of other infrastructure that won't even be completed in short term.
Besides El Salvador is among the poor countries but about $60 million in bitcoin for a country with $25 billion GDP (0.24%) doesn't look that big to be honest.

In any case, this is a very exciting experiment to watch over the coming years and see how this poor country is going to be like in like 5 to 10 years from now. This could provide good information for other countries with bigger and better economies to decide whether they want to start adding bitcoin to their reserves.

Yes, fingers are crossed to see what the investment will become in the next couple of years to come, I believe this move will positively impact the economy that other countries will be referring to El Salvador for its great economic transformation.

[bekti3]

As long as they can spend their earnings on important things the people care about (not $4,000,000 animal hospitals) I think they will do just fine.

they are still at the forefront of this kind of adoption but on the other hand I really question their profitability as there is not even any word on how they are selling but there is already a profit there.
On the other hand, things like this are actually pretty good and I'm quite supportive of things like this because they're always at the forefront of this I think.
with this also apart from bitcoin they will be known by most circles and that's good enough for them

[Artemis3]

El Salvador president does not have a good financial advisor that truly understands the working of the cryptocurrency market and that is the reason he always purchases Bitcoin at pick price, what have they been doing in the last week when the price was around 40k or above why waiting until it reaches 50k before buying each time. Anyways it is a good move but for a long time base.

He is not trading he is holding, nothing wrong with that... Anytime is as good as ever, as long as your vision remains long term. Some people just go with scheduled buys, no matter what the price is. This is a perfectly valid long term strategy. Also fitting in a country that is starting to pay wages in bitcoin, which happens at specific days of the month, no matter what the market price is. It will average, the variability is not a problem because what most employers do is pay the equivalent of "something else" in bitcoin at any given time, just like those purchasing things over there.

I believe there is a thread somewhere in this forum about, what if you purchase 1 USD equivalent of bitcoin everyday, with a comparison of the USD invested vs actual current USD if you sold those bitcoins.

Remember, all fiats, and their pegged altcoins, are designed to lose purchasing power over time, over the dogma of obsolete economic thinking that debt is king and infinite credit expansion is the way (its the cause of bubbles and crashes too, from the distortions to the economy this generates).

Of course they don't want you to keep your garbage money saved, that is the whole point. Thus the inflation is seen by them like the driving factor for you to use it. This is so wrong in so many ways i won't even start, just read the Austrian school of economics for better insight.

And then came bitcoin. Of course they are in panic, they are the cause of the problem. Might as well close all those useless central banks. The remaining banks should drop the fractional reserve ponzi scheme and be clear to their clients, if they want to keep existing that is.

You see, they wanted you to depend on banks. But guess what, you don't need banks anymore, if you want to use them its your choice, but its no longer required.

[Leviathan.007]

Talking about 21 bitcoins, in the early years of bitcoin none could imagine the amount of 21 bitcoin will be this much important to be mentioned in articles and people start talking about it. However, El Salvador has already shown us how they believe in bitcoin and use it as a hedge against the inflation rate. We all know El Salvador had some of the worst economic situations and worthless fiat currency but after these investments by their government, I expect to see surprising news about this country in a few years if they stay in this way.

[Smartvirus]

~snipe~

Though the value bought might seem small for a nation, a few things hold. It was bought of no serious significance, just to add some more to there hodling. Though, I see what they are doing to be of some significant to the crypto space as, they've not had some negativism to the crypto instead, they buy out of benefits from the legalisation they've done on bitcoin. Its a plus for bitcoin and with time, other nations would see the need to bitcoin legalisation.

[perfect999]

As long as they can spend their earnings on important things the people care about (not $4,000,000 animal hospitals) I think they will do just fine.

they are still at the forefront of this kind of adoption but on the other hand I really question their profitability as there is not even any word on how they are selling but there is already a profit there.
On the other hand, things like this are actually pretty good and I'm quite supportive of things like this because they're always at the forefront of this I think.
with this also apart from bitcoin they will be known by most circles and that's good enough for them

There’s really nothing to be questioning here, it’s already clear that they would continue to hold it, and as the price of Bitcoin continues to increase that would mean profit for them. Imagine that Bitcoin reaches $100,000 by next year as some analysts has been saying, that is going to mean about double of their investment. It will then be up to their government and whether they would want to sell the assets or maybe continue to hold it. Even if they should continue to hold it, it’s still not a bad idea because the value of Bitcoin will continue to increase in the future. So they have made a really good choice for investment.

[RILWAN]

El Salvador is already ahead of many other smaller countries that are currently facing economic challenges as they have gone a step ahead to invest in the future. I don't care at what price they bought Bitcoin as long as it is stored and held for a long time then its price will increase.

[bekti3]

As long as they can spend their earnings on important things the people care about (not $4,000,000 animal hospitals) I think they will do just fine.

they are still at the forefront of this kind of adoption but on the other hand I really question their profitability as there is not even any word on how they are selling but there is already a profit there.
On the other hand, things like this are actually pretty good and I'm quite supportive of things like this because they're always at the forefront of this I think.
with this also apart from bitcoin they will be known by most circles and that's good enough for them

There’s really nothing to be questioning here, it’s already clear that they would continue to hold it, and as the price of Bitcoin continues to increase that would mean profit for them. Imagine that Bitcoin reaches $100,000 by next year as some analysts has been saying, that is going to mean about double of their investment. It will then be up to their government and whether they would want to sell the assets or maybe continue to hold it. Even if they should continue to hold it, it’s still not a bad idea because the value of Bitcoin will continue to increase in the future. So they have made a really good choice for investment.

Indirectly they have benefited but indeed when talking about speculation now I think everyone has their own speculation about bitcoin and the truth is that until now nothing is really right and only bitcoin is able to answer speculators at this time.
But for them I'm quite happy because as you said, whether it's being held or partially sold they will still be in profit, on the other hand the longer they hold on to it the better it actually is for them.