El Salvador to hold Bitcoin conference after facing 44% loss from its BTC investment

YEREVAN (CoinChapter.com) – El Salvador, the first country to make Bitcoin (BTC) legal tender, will host a mega Bitcoin (BTC) crypto event on May 16

President Nayib Bukele noted that 44 countries would participate in discussions aimed at financial inclusion and the emerging digital economy. He also noted that representatives of 32 central banks and 12 financial institutions would also get the floor to talk about El Salvador’s Bitcoin rollout.

Paraguay, Uganda, Jordan, Pakistan, Armenia, Kenya, and Costa Rica, are among the countries that will attend the event.

El Salvador’s Bitcoin losses amount to $40 million

The announcement comes after a massive price decline in Bitcoin and elsewhere in the crypto market, pushing the valuation of El Salvador’s Bitcoin reserves lower in tandem.

In detail, El Salvador has constantly bought more BTC every time the price has dipped. As the Bitcoin price tumbled last week, Bukele announced he had added 500 coins to the country’s balance sheet. At the time of writing, El Salvador holds 2,301 BTC worth over just $68 million. 

Meanwhile, El Salvador has lost over $40 million in the current market crash. Since President Bukele began filling his country’s coffers with BTC last September, the price has fallen over 45%. El Salvador spent about $105 million buying 2,301 Bitcoins.

However, at the time of writing, El Salvador’s BTC is worth just over $68 million.

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The county’s losses in BTC are equal to what Bukele’s government has to pay to bondholders next month.

Bond markets now doubt El Salvador’s ability to service its debt, with the rating agency Fitch downgrading the country’s debt to CCC. This means El Salvador is highly vulnerable and “depends on favorable business, financial, and economic conditions to meet its financial commitments.”

Meanwhile, El Salvador is unlikely to secure financing from the International Monetary Fund (IMF) because of its exposure to Bitcoin. However, unfazed by the falling BTC prices and debt default risks, Bukele has announced the development of a so-called “Bitcoin City” near the Conchagua volcano on the Gulf of Fonseca, the country’s southern region.

Meltdown worries

As President Nayib Bukele attempts to popularize Bitcoin (BTC) among emerging economies, the world’s leading cryptocurrency continues to suffer. For the first time in many years, BTC has painted the charts red for over a week.

According to the BTC weekly chart by TradingView, the largest crypto by market cap has printed seven weekly red candles in a row. The development comes as Bitcoin continues to remain under $30,000. The crypto market meltdown threw the BTC price to as low as $26,350.49 on May 12.

While the latest market dip is worrying, many more countries may join El Salvador to give Bitcoin legal status. Last month, the Central African Republic became the second country to legalize BTC as legal tender. Parliamentarians in Panama also voted in favor of cryptocurrencies.