El Salvador remains firm in its commitment to Bitcoin, continuing to buy the cryptocurrency even as its price hovers below $100,000. The nation recently added another 12 BTC to its reserve, bringing its total holdings to 6,068 BTC, worth over $554 million. This decision comes despite a market downturn and a pressure-filled loan agreement with the International Monetary Fund (IMF).
El Salvador has built a reputation for acquiring Bitcoin during price dips. In the last few days, the country purchased 11 BTC on February 4 for over $1.1 million, with the average price of $101,816 per Bitcoin. In addition, the country added another BTC at $99,114. Over the last week, the nation acquired 21 BTC, and in the past 30 days, it has accumulated 60 BTC. This strategy reflects a steady long-term approach to Bitcoin investment, highlighting the country’s belief in the digital currency’s future growth.
Despite its continued Bitcoin acquisition, El Salvador has adjusted its policies to comply with the IMF’s demands in exchange for a $1.4 billion loan. Initially, the country passed a groundbreaking Bitcoin law, which required businesses to accept Bitcoin as a payment method. However, the IMF, skeptical of Bitcoin’s volatility, pressured the government to amend the law. As a result, businesses are now permitted to choose whether to accept Bitcoin, effectively dropping the mandatory requirement.
While this change has raised some concerns about the government’s commitment to Bitcoin, the country’s recent moves show that it remains firmly invested in the cryptocurrency. The fact that El Salvador continues to purchase large quantities of Bitcoin, even amid such legal modifications, is a clear indication that its belief in Bitcoin’s potential has not waned.
Bitcoin has struggled to maintain its upward momentum, slipping below the crucial $100,000 threshold in recent days. As of the latest data, the cryptocurrency dropped to a 24-hour low of around $96,000. The inability to maintain a position above $100,000 raises concerns about the broader market’s sentiment. Investors and traders are increasingly cautious as Bitcoin fails to break through key price levels, contributing to an overall bearish atmosphere.
In addition to its price struggles, technical indicators suggest that Bitcoin could face further downward pressure. The 14-week relative strength index (RSI) has followed a bearish trajectory similar to 2021, when Bitcoin underwent a major correction. For the cryptocurrency to rebound, the RSI would need to reverse its downward trend and signal a shift in market sentiment. Until this occurs, Bitcoin may continue to see price fluctuations and investor hesitation.
El Salvador’s persistent Bitcoin purchases are in stark contrast to the short-term struggles of the asset. The country’s Bitcoin strategy is anchored in long-term confidence, even though the price is currently below the $100K mark. The fact that the nation continues to add to its holdings shows that it is committed to its vision of Bitcoin as a fundamental part of its economy.
The purchase of 60 BTC in the past month alone reflects the country’s strong belief in the cryptocurrency despite short-term challenges. Furthermore, El Salvador’s growing reserves and long-term holding strategy could prove advantageous when the market eventually recovers.
While Bitcoin’s short-term outlook remains uncertain, El Salvador’s ongoing Bitcoin acquisitions demonstrate a strong long-term belief in the asset. Despite the challenges posed by its revised Bitcoin law and the IMF’s influence, El Salvador continues to strengthen its Bitcoin holdings, which could prove beneficial when market conditions improve. The country’s steady investment strategy in Bitcoin, even as the cryptocurrency faces bearish trends, reinforces its vision for a Bitcoin-integrated future.
Julie is a renowned crypto journalist with a passion for uncovering the latest trends in blockchain and cryptocurrency. With over a decade of experience, she has become a trusted voice in the industry, providing insightful analysis and in-depth reporting on groundbreaking developments. Julie's work has been featured in leading publications, solidifying her reputation as a leading expert in the field.
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