El Salvador’s Exposure to Bitcoin Is Still “Minimal”, Asserts Chairman of CABEI

El Salvador’s exposure to Bitcoin is still minimal – according to Dante Mossi, the chairman of the Central American Bank for Economic Integration.

Speaking to Bloomberg, Mossi asserted that while Bitcoin’s popularity and adoption has increased since it was made legal tender in El Salvador about two years ago, the population’s exposure to it was still minimal.

“We have seen that exposure and we consider it very small “- it is a not significant one,” Mossi stated, “We are interested that investors also know the real situation of El Salvador.”

In September 2023, El Salvador came under the global limelight after becoming the first nation to adopt Bitcoin as a legal tender and making some considerate purchases in the virtual asset as well. As of July 2022, the President’s Bukele-led government had amassed 2,381 Bitcoins, according to their public announcements on Twitter. The government has received staunch criticism in past months for failing to disclose the official Bitcoin holdings of the small nation.

The criticisms grew substantially after the president made the public announcement to purchase one Bitcoin daily on November 17 last year. Assuming that the president has lived up to his announcement, the Nayib Bukele Portfolio Tracker estimates that the small nation has spent more than $109 million on bitcoin purchases but is down over $51 million based on current market prices.

El Salvador’s unrealized paper losses and bad economic decisions have made it difficult to access capital from lenders. Last month, the country received a $450 million loan from Mossi’s multinational lender, most of which will be used in repaying a bond next week. According to Mossi, the lender has barred the nation from buying any more crypto assets, noting that the loan proceeds will be audited in six months.

Meanwhile, the Central American Bank for Economic Integration (CABEI) has been working with the country to collect information on the country’s finances, which will be presented to the International Monetary Fund for review & recommendations, including the country’s cryptocurrency holdings.

Recently, the Bukele administration has also been criticized by the human rights group Cristosal for its “absolute opacity about the use of public funds” to amass bitcoins. “The lack of transparency leaves citizens without knowing the beneficiaries, quantities, or reasons for granting the funds,” the human rights group added.