El Salvador’s Bitcoin bet could be putting the country in peril as its holdings have already lost $40m in amid a cryptocurrency rout.
The losses – equal to the Central American country’s next bond payment – come amid a so-called ‘crypto winter’ and the president’s plans to build a volcano-powered ‘crypto city’ to mine bit coin.
President Nayib Bukele announced in September that El Salvador would become the first country in the world to accept Bitcoins as legal tender and forked out $105 million on the digital currency.
But since then its value has fallen 45% amid a general bursting of the crypto bubble, slicing the value of the 2,301 Bitcoins bought by state coffers down to $66 million.
The decision to make Bitcoin legal tender has nonplussed bond investors, who see it as exposing the…
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