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El Salvador, the first country in the world to adopt Bitcoin as a fiat currency, is in crisis.
Coindesk, a media specialized in cryptocurrency, reported on the 14th (local time) that the value of Bitcoin held by El Salvador, which adopted Bitcoin as a fiat currency for the first time in the world, has fallen sharply as Bitcoin has recently plummeted.
According to reports, El Salvador has 2301 bitcoins. Converting this to the present value, it is equivalent to $53 million (regarding 68.3 billion won).
However, the cost of buying Bitcoin in El Salvador was regarding $103 million (regarding 132.8 billion won). The present value is cut in half from the purchase price.
El Salvador President Nayve Bukele has been collecting bitcoins steadily by buying at low prices whenever bitcoins fall. However, the recent plunge has reduced its value to half of the purchase price.
On the other hand, the probability of default (default) in El Salvador is increasing. El Salvador’s government has to repay regarding $800 million worth of government bonds. If the bonds are not repaid before the maturity date of next year, they face a default crisis.
Jang Ji-min, Guest Reporter at Hankyung.com [email protected]
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