El Salvador celebrates Christmas 2024 by buying another Bitcoin

Holiday celebrations under IMF restrictions in El Salvador.

As the country increases its Bitcoin (BTC) reserve, El Salvador’s 2024 Christmas celebration features a distinctive Bitcoin-themed Christmas tree, further demonstrating the country’s undying devotion to the original cryptocurrency.

🇸🇻 Bitcoin Christmas in El Salvador pic.twitter.com/EcXVS3QWPV

— Watcher.Guru (@WatcherGuru) December 23, 2024

On December 19, 2024, El Salvador made headlines once again by purchasing 11 BTC worth over $1 million, shortly after receiving a $1.4 billion loan from the International Monetary Fund.

This action demonstrates the country’s bold BTC strategy despite criticism from outside. The criticism comes primarily from traditional financial institutions and economists who have expressed concerns about the risks of BTC’s volatility and its impact on the country’s financial stability.

El Salvador became the first country to accept BTC as legal tender in September 2021, making history in the process. Although controversial, this decision signaled a shift in the country’s attitude towards cryptocurrencies. BTC has become an important part of the country’s financial scene in recent years.

Cryptocurrency has become a part of daily life, from government-backed BTC ATMs to its increasing use in businesses.

But this approach has been met with skepticism, especially by global financial institutions such as the IMF, which impose conditions on the country’s fiscal strategy.

The terms of the last $1.4 billion IMF loan signed on December 18, 2024 affect the country’s cryptocurrency policy; One of them is to ban cryptocurrency transactions. Moreover, companies are no longer required to buy cryptocurrencies and taxes can only be made in US dollars.

In addition, the IMF ordered the government of El Salvador to stop using the Chivo wallet, a government-backed cryptocurrency wallet that was first introduced in 2021. This wallet was a component of El Salvador’s larger initiative to incorporate BTC into the country’s financial system. Enabling companies and residents to use cryptocurrencies to access government services and conduct transactions.

IMF loans often have terms that have a direct impact on a country’s fiscal and economic choices. The purpose of these requirements is to guarantee financial restraint and compliance with global financial norms. Some independent financial practices, such as the use of cryptocurrencies, may need to be abandoned or restricted due to credit regulation.

These loan terms often lead to a loss of financial sovereignty, as the IMF pressures nations to adopt more traditional monetary practices, such as relying on central banks and national currencies rather than decentralized digital currencies.

But it looks like El Salvador won’t back down. The government still prioritizes cryptocurrencies despite the IMF’s restrictions. The country’s National Bitcoin Office, established in 2021 as a key part of the country’s BTC strategy, reaffirmed its commitment to the long-term BTC plan and stated that no BTC from its reserves will be sold.

🇸🇻We just transferred over a million dollars worth of Bitcoin to our Strategic Bitcoin Reserve. pic.twitter.com/4ZrxGw9Od0

— The Bitcoin Office (@bitcoinofficesv) December 20, 2024

El Salvador currently holds 5,995 BTC, worth approximately $569.5 million at the time of this writing. After their latest purchase of 11 BTC, their total reserves are now close to 6,000 BTC. The average purchase price per BTC in the country is approximately $97,000.

The country’s commitment to BTC as a long-term investment is evidenced by the latest statistics from its portfolio:

Total BTC Assets: Over $572 million or around 5,995 BTC. Impact of BTC Price: Due to volatility, the portfolio recently experienced a decline of $6.08 million; This is equivalent to a small drop of $1.02k per BTC. Source: Arkham

The balance history chart shows a general upward trend in the value of reserves and shows stable long-term growth despite temporary fluctuations. In particular, 2024 saw a significant increase that started in the middle of the year and continued to increase steadily until December, corresponding to the new IMF agreement and the country’s ongoing BTC purchases.

Despite worldwide criticism, El Salvador demonstrates a clear and calculated strategy to protect cryptocurrency assets by using such powerful financial tracking systems.

El Salvador has shown its support for the cryptocurrency sector, recognizing its potential to promote financial independence and reduce dependence on global financial institutions. El Salvador’s stance remains unwavering in the face of obstacles such as pressure from the IMF. The country’s BTC tree for Christmas 2024 heralds a day when cryptocurrencies will not only be adopted but will play a major role in the country’s financial destiny.