After weeks of silence on everything related to bitcoin (BTC), El Salvador President Nayib Bukele announced on Twitter that his government has bought $ 15.4 million worth of BTC - and also unveiled plans for Bitcoin City. . However, opposition voices continue to issue warnings, with a former head of the central bank attacking Bukele's plans to finance the construction of the city with an issue of bitcoin bonds. Bukele's government buys 500 BTC As previously reported, many observers have argued that the bond issue will not happen after the government missed its mid-March deadline. The government has denied these claims. For much of the year, however, Bukele - usually very active and outspoken about all things BTC - has been silent on bitcoin-related matters, instead tweeting mostly about his government's war with street gangs. pandilla. That all changed in the last few hours, when Bukele announced that the government had "bought after the crash" - buying 500 BTC for an "average price of $ 30,744". Bitcoin prices continued to stall near the $ 30,000 mark, with only slight recoveries since the president made his move. At 7:14 UTC on Tuesday, it is trading at $ 32,094, down 5% in one day and 16.5% in a week. The purchase means that El Salvador has bitcoin reserves of more than 2,300 BTC ($ 73.8 million), although no official government records have been made detailing the purchases - and Bukele's tweets on the matter are the only communication. of the government on the subject. Bitcoin City Bukele also posted a series of images of a gold-colored 3D model of the city, which is under construction at the foot of a volcano currently used to mine BTC using geothermal energy. He then posted two rendered images showing what the completed Bitcoin City would look like at night, as well as what appears to be a viewing platform or walkway near the top of the volcano. Some argue that Bukele's plans are feasible Francis Pouliot, the chief executive of Bull Bitcoin, did not look favorably on the developments and said that he is "absolutely crazy that some people really believe" that the project will go ahead. Meanwhile, Carlos Acevedo, the former governor of the central bank, the Central Reserve Bank of El Salvador, told a Salvadoran television channel that the government's "hope" to issue the bonds was "already gone." For ElSalvador.com, Acevedo indicated an $ 800 million bill that the government will face in January next year, when the (conventional) bond expires. Acevedo said an International Monetary Fund (IMF) aid package is now off the table with "the door closed" to such support. And the thorny issue of balancing the accounts may, the former head of the central bank said, leave the government no choice but to "re-engineer" public finances - and nationalize Salvadoran pension funds. This is "something economists and lawyers have been warning about" for some time, particularly when institutions like Moody's tweaked their credit scores down for El Salvador. Last week, Moody's downgraded the country's rating from Caa1 to Caa3, and also warned that the state might use public savings "to obtain liquidity," and denounced a "lack of information" about the plans. by Bukele. Acevedo also attacked Bukele and his government for the "lack of transparency in public spending", arguing that this has alienated international bodies. He also claimed that BTC has lost up to 50% of its value since reaching its maximum price, arguing that this would further damage the Salvadoran economy.
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Bukele talks about plans for Bitcoin City and buys 500 BTC
Source: Nayib Bukele / Twitter