El Salvador and Bhutan Make Huge Profits from Bitcoin Investment
The strong rise of Bitcoin has raised the Bitcoin portfolios of "Bitcoin paradise" El Salvador and Bhutan to $500 million and $1.1 billion, respectively.
El Salvador is making a 98% profit from Bitcoin "gamble"
According to data from the Bitcoin Office of El Salvador, the country currently owns 6,155 BTC. At the current price of $87,700 per Bitcoin, this holding is worth approximately $500 million, accounting for 1.5% of the country's GDP.
I told you so.
— Nayib Bukele (@nayibbukele) November 11, 2024
El Salvador took the national budget to "buy the bottom" of Bitcoin in 2021 and applied a cost averaging (DCA) strategy, buying more BTC every day, from November 2022 to now. According to President Nayib Bukele, the Central American country has started to profit from its Bitcoin investment in December 2023.
In the past, the plan to go all-in on Bitcoin has caused controversy with the International Monetary Fund, because the IMF was concerned about El Salvador's financial situation. However, the country that legalized Bitcoin in 2021 seems to have found a "dragon vein", as evidenced by the unrealized profits of up to 98% (about $134 million) at the time of writing.
By August of this year, the IMF discussed with the El Salvador government and noted progress in negotiations to implement a support program, focusing on strengthening public finances, increasing bank reserves, improving transparent governance, and minimizing risks from Bitcoin. However, Bukele still admitted that the adoption of Bitcoin has not met expectations, but has not caused any negative consequences.
Yesterday, El Salvador also proposed a third bond buyback this year. The government of El Salvador plans to purchase a series of bonds maturing between 2027 and 2034, with an original value of over $2.5 billion. However, the method of financing the transaction has not been disclosed.
Since Donald Trump won the election, El Salvador's debt has returned 4.7%, outperforming all emerging market countries except Ukraine. Investors believe that a second Trump term would help Bukele secure support from the International Monetary Fund.
Bhutan's Bitcoin Portfolio Makes Up ⅓ of Its GDP
Bhutan, a small South Asian nation with a population of about 800,000 (compared to El Salvador's 6.4 million), currently holds 12,576 BTC, worth about $1.1 billion, according to data from Arkham Intelligence. Bhutan's Bitcoin holdings account for more than a third of its GDP.
Bhutan has been mining Bitcoin since 2019, thanks to the abundant hydroelectric power source here. As of September this year, Bhutan is the 4th largest Bitcoin holder in the world, after the US, China and the UK.
Notably, a wallet cluster owned by the Bhutanese government on the afternoon of October 29 moved 929 BTC ($66 million) to the Binance exchange, the purpose of which is still unknown.
The profits of the two countries, although impressive, still cannot compare to that of billionaire Michael Saylor's MicroStrategy. This tech giant just bought another 27,200 BTC the night before and is currently "earning" $10.7 billion. MicroStrategy also has ambitions to become the world's first Bitcoin bank, and plans to raise $42 billion in capital over the next 3 years to continue accumulating Bitcoin.
On the other hand, the US and German governments missed out on $18 billion in profits due to early Bitcoin sales. Recalling the period when these two countries continuously "dumped" Bitcoin into the market, many people still consider this to be nothing more than a nightmare.
