El Salvador's bitcoin stash value drops to $52.4M as crypto winter sets in

Jun. 14, 2022 3:12 PM ETBitcoin USD (BTC-USD)MSTR, TSLABy: Max Gottlich, SA News Editor89 Comments

Bitcoin Flag of El Salvador

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Since it started buying bitcoin (BTC-USD) in September 2021, El Salvador's holdings are getting sliced by around 50% amid immense selling pressure in cryptocurrencies as well as increased regulatory scrutiny.

The country's bitcoin (BTC-USD) stash was last valued at $52.4M compared with its total investment of nearly $104M.

As of May 9, El Salvador, the first country to make bitcoin (BTC-USD) legal tender, was HODLing 2,301 BTC at an average price of $43.8K.

President Nayib Bukele's investing strategies of "buy the dip" and "HODL" certainly don't seem to be paying off, as bitcoin (BTC-USD) earlier this week tanked to its lowest since December 2020. Over the past 24 hours, the world's largest digital token by market cap is sliding to $22.2K as of shortly before 3:30 p.m. ET.

Still, the unrealized bitcoin (BTC-USD) losses likely won't hurt El Salvador's fiscal health. "When they tell me that the fiscal risk for El Salvador because of Bitcoin is really high, the only thing I can do is smile," said El Salvador's Finance Minister Alejandro Zelaya at a press conference, as reported by Reuters on June 13. "The fiscal risk is extremely minimal."

Take a look at how MicroStrategy (MSTR) and Tesla's (TSLA) bitcoin (BTC-USD) positions are faring

As Bitcoin (BTC-UDS) craters over 26% just in the past five sessions, there could be room for some upside. It's "looking to form a local bottom between the $20-$22k range, with a potential bounce towards $26k, however, the likely scenario is that price will further fall below towards $14-$17k range where a cyclical bottom can potentially form," said Abdul Gadit, CFO and co-founder of Zignaly, a platform allowing investors to copy crypto trades of digital asset managers.

Earlier, ethereum drops faster than bitcoin, spelling trouble for altcoin sentiment.

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