El Salvador, the first country to adopt Bitcoin as legal tender, has announced plans to continue purchasing bitcoin (BTC) and expand its national Bitcoin reserve. The decision represents the Central American country’s commitment to integrating crypto into its financial ecosystem despite the volatility that has characterized the crypto market.
The announcement comes after the country secured a $3.3 billion International Monetary Fund (IMF) Loan. The funds will support public finances, support social programs, and stimulate economic growth. In return, the government has agreed to implement fiscal reforms, including the voluntary BTC policy.
El Salvador Stacking BTC & Bitcoin Reserves
Over the years, El Salvador has become known for its dedication to acquiring BTC. The Central American country started purchasing in 2021, paving the way for other countries, states, and institutions to emulate.
El Salvador also recently announced that it would begin purchasing 1 BTC per day, possibly at an accelerated pace, for its strategic reserve. Despite the risk associated with bitcoin price volatility, the country currently owns 5,968.8 bitcoins, valued at approximately $602 million.
In line with BTC reserves, 2024 has been a roller coaster, with institutions establishing their BTC reserves. On November 15, 2024, the House of Representatives of Pennsylvania, the fifth-most populous state in the United States, made a strategic move to support crypto adoption by passing a law to add bitcoin to the state balance sheet as a reserve asset. The bill aimed to establish a strategic Bitcoin reserve, potentially boosting America’s standing as a crypto hub.
An Ohio lawmaker also recently introduced a bill that could position the state to embrace BTC. The proposed legislation seeks to establish a state Bitcoin reserve, allowing Ohio to purchase and hold bitcoin as part of its financial assets.
The lawmaker noted the creation of a framework for the state to acquire, hold, and potentially utilize BTC in various capacities, including as a hedge against inflation and a tool for diversifying state financial reserves.
No To Bitcoin Reserves
With states turning to create a Bitcoin reserve, not everyone agrees with the move. Former United States Treasury Secretary Lawrence Summers criticized President-elect Donald Trump’s proposal for a strategic Bitcoin reserve, calling it “crazy.” He accused the move of being a strategy designed to appease his crypto campaign donors.
Also, Avik Roy, president of the Foundation for Research on Equal Opportunity, stated at a crypto summit last month that Bitcoin’s potential benefits are being “overhyped.”
Saylor Supports Bitcoin
As such, to help clear some doubts, popular American entrepreneur and Bitcoin champion Michael Saylor said Bitcoin is an economy, not a Ponzi scheme. The executive expressed his confidence in the crypto and defended it from opposing opinions.
Additionally, he stated that his Bitcoin purchases are unlimited. His company will keep buying BTC forever, no matter the price, because he believes every day is a good opportunity to acquire the crypto asset.
