El Salvador purchases more bitcoin worth $15 million on market dip

Quick Take

  • El Salvador purchased 410 more bitcoins for $15 million, president Nayib Bukele tweeted on Friday.
  • The country has now purchased at least 1,801 bitcoins, based on announcements to date.

El Salvador has purchased an additional 410 bitcoin for $15 million, according to a Friday tweet from its president Nayib Bukele.

“Some guys are selling really cheap,” Bukele wrote in English, referring to bitcoin hitting a six-month low the same day.

According to CoinMarketCap, the price of bitcoin dipped to about $36,630 at 4:54 p.m. before Bukele’s tweet at 5:18 p.m. It continued to decline throughout the evening.

The Jan. 21 tweet was in response to an older one from Jan. 14, where the president had written “I think I might have miss[ed] the dip this time.” But he started this most recent update by saying “Nope, I was wrong, didn’t miss it."

Most of what we know about the quantity and timing of El Salvador’s bitcoin purchases comes from Bukele’s tweets, in which he often mentions that the country had just “bought the dip.” That phrase refers to a strategy of purchasing bitcoin at a “discount” when it significantly decreases in value, which in theory would create gains for the buyer when the price eventually rises again.

El Salvador has now bought at least 1,801 bitcoins, based on what we know about the country’s purchase history. Before the latest tweet, El Salvador had amassed 1,391 bitcoin according to Bukele’s announcements. In a January 12 news story, Bloomberg calculated that Bukele’s announced purchases up to that time would have cost El Salvador $71 million.

El Salvador bitcoin purchases, based on Bukele’s tweets

Total BTC to date: 1,801 

Jan. 21, 2022 - 410 BTC (worth $15 million at time of purchase)

Dec. 21, 2021 - 21 BTC

Dec. 4, 2021 - 150 BTC (purchased at average USD price of ~$48,670)

Nov. 26, 2021 - 100 BTC

Oct. 27, 2021 - 420 BTC

Sept. 19, 2021 - 150 BTC (bringing total to 700)

Sept. 7, 2021 - 150 BTC (bringing total to 550)

Sept. 6, 2021 - 200 BTC  (additional coins)

Sept. 6, 2021 - 200 BTC (first purchase)

Source: The Block's analysis of Bukele’s tweets relating to bitcoin purchases

But Salvadorans and industry analysts alike have raised questions about how the country purchases bitcoin, not only due to market conditions but also in light of Bukele’s comments on social media. For example, on December 4 Bukele tweeted: “Missed the f***ing bottom by 7 minutes.” The same day, he also revealed that he trades bitcoin from his phone. And when Bloomberg mentioned the phone trading nugget in a tweet about their recent article, he responded with another single word: “naked.” 

Not surprisingly, people are wondering how exactly Bukele decides when and how to buy bitcoin. When finance minister Alejandro Zelaya appeared on the local interview program Frente a Frente in early January, he mentioned the existence of a team fully immersed in trading bitcoin. One viewer asked what kind of methodology the government is using for buying and selling bitcoin, wanting to know if that strategy included tools like an asset manager, algorithmic trading or technical analysis.

“Of course there is use of technology, and of course there are procedures used for the purchase of coins as such,” Zelaya said, without giving specifics.

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