El Salvador Continues Aggressive BTC Accumulation Amid Market Dip
- El Salvador expands BTC reserves with $100M purchase, raising national reserves to 7,474 BTC.
- The purchase renewed scrutiny over IMF limits and uncertainty around the source of new holdings.
- Analysts say the strategy strengthens Bitcoin reserves but increases exposure to price volatility.
El Salvador moved deeper into its Bitcoin strategy this week. The government revealed a large purchase as the Bitcoin price fell below 90K. The country confirmed the transaction on Monday evening. According to its Bitcoin Office, El Salvador acquired 1,090 BTC worth $100 million during the price drop. The purchase marked the largest single-day addition since the nation adopted Bitcoin as legal tender. The buy pushed national holdings to 7,474 BTC.
A Strategy Built on Steady Accumulation
El Salvador has followed a predictable pattern since late 2022. President Nayib Bukele announced daily purchases of one Bitcoin nearly two years ago. The policy continued despite sharp market swings and international pressure. Recent activity showed the country remained committed to its long-term strategy.
The government added more than 1,100 BTC in the past month. The new purchase aligned with earlier buying behavior. Officials often bought when prices moved lower. Analysts viewed this as a disciplined accumulation approach with dollar-cost averaging features.
The government valued its total holdings at roughly $670 million. The Bitcoin Office said the country sought to increase reserves with each dip. The latest buy matched that stated objective.
However, the acquisition triggered new scrutiny. Analysts examined whether the government bought coins directly from the market or consolidated holdings across state wallets. This question emerged because of the country’s loan agreement with the IMF. The deal required the public sector to avoid new Bitcoin purchases. This tension created uncertainty around the source of new holdings. Analysts said the issue remained unresolved.
Fiscal Questions Surround Bitcoin Reserve Management
The latest purchase drew attention to the broader fiscal effects of the strategy. El Salvador continued to treat Bitcoin as a reserve asset alongside sovereign holdings. Analysts studied how this affected reserve stability and national exposure. They said volatility remained a central factor.
Bitcoin fell below $90,000 during Monday’s market move. The country used that moment to increase its reserve position. This aligned with earlier buying periods when prices moved lower. The strategy raised research questions about short-term risk and long-term reserve growth.
Related: Bitcoin Falls Toward Key Levels as Liquidations Strike Hard
Some analysts said the approach aimed to hedge against inflation. Others said it reflected a desire to diversify away from the U.S. dollar. The government did not confirm either interpretation. However, the consistent pattern of accumulation provided researchers with new data.
The purchase also fed broader discussions about sovereign Bitcoin adoption. El Salvador led this movement in 2021. Its continued buying reinforced that leadership position. The country’s approach now serves as a reference point for other nations observing digital assets.
The long-term effects remain unclear. The country’s Bitcoin position continues to grow. The strategy offers researchers a live case study in national crypto reserve management. Analysts said future price cycles would reveal more about the risks and potential benefits.
