El Salvador has purchased an additional 11 Bitcoin for its national reserve, bringing its total holdings to 6,067 BTC, as reported by Cointelegraph on February 10, 2023. This acquisition comes just days after the country agreed to scale back some of its pro-Bitcoin policies to secure a $1.4 billion loan from the International Monetary Fund (IMF).
The move highlights El Salvador's continued commitment to Bitcoin, despite concessions made to the IMF. The country's Bitcoin stockpile is now worth approximately $600 million at current prices, with Bitcoin rebounding to $100,000 following a potential trade war between the US and Canada, China, and Mexico.
El Salvador's Bitcoin acquisition policy has accelerated following its agreement with the IMF and the country's acceptance of deported criminals and migrants from the U.S. in exchange for a fee. This decision was announced after a meeting between El Salvador's President Bukele and U.S. Secretary of State Marco Rubio, with President Trump having previously spoken with Bukele via telephone.
While there is no official confirmation that Bukele discussed crypto with Rubio or Trump, El Salvador's Bitcoin stockpiling may lead to speculation about a potential U.S. strategic reserve. President Trump has already signed an order establishing a working group to assess the feasibility of a "national digital assets stockpile." This order, titled "Strengthening American Leadership in Digital Financial Technology," gives the working group 180 days to propose regulatory and legislative measures.
The market could receive news regarding this proposal in July. However, the order suggests that any stockpile would be derived from cryptocurrencies seized by the Federal Government through law enforcement efforts. With the U.S. federal government currently holding nearly 1% of Bitcoin's circulating supply, a recommendation to hold Bitcoin might simply mean the government refrains from selling its seized assets.
Meanwhile, U.S. states are actively considering BTC reserves, with a fifth of all state legislatures currently exploring the possibility. El Salvador's recent purchase of 11 BTC could be interpreted as a similar sign, indicating the country's anticipation of a future Bitcoin accumulation race.