El Salvador was forced to buy back its own bonds after the BTC crash

El Salvador is starting to feel hot In the Bitcoin Kitchen. The Central American country tried so hard to buy bitcoin and make digital assets a part of its balance sheet that things eventually worked out very well. Now that the currency has sunk into oblivion, El Salvador is doing everything it can to protect itself and keep its economy stable as digital assets seek a return.

El Salvador is trying to buy debt

The nation announced that it will buy back nearly $1.6 billion of its bonds as a way to prevent itself from falling into default. Its bonds have traded at steep discounts over the past eleven months since regulators announced the legal tender for bitcoin last September.

The President of El Salvador, Neb Bukele, explained in a series of tweets:

Today, we’re sending two bills to Congress to make sure we have the funds available to make a transparent, public and voluntary buy-back offer for all holders of Salvadorian sovereign debt from 2023 to 2025 whatever the market price at that time. every transaction.

Bukele told his followers there was not much to worry about. He says the country is not in bad shape and that El Salvador has all the cash it needs to meet the current schedule and the purchase commitments it has made. He also said that El Salvador will be able to purchase all of its debt in advance, which will take place over the next six weeks at market rate.

Finance Minister Alejandro Zelaya Santié also threw into the mix, commenting:

We guarantee the availability of funds to offer our bondholders the option of an early debt purchase, which will be public and will respect market regulations.

In the past, Zelaya has commented that he is not too concerned about drops in the price of Bitcoin. He said back in June:

When they told me that the financial risks to El Salvador because of Bitcoin are [quite] High, the only thing I can do is smile. The financial risks are minimal.

Long and turbulent history with Bitcoin

El Salvador was the first country to announce a legal tender for Bitcoin. The nation faced a great deal of resistance from organizations like the World Bank, which stated early on that it would not help the country with its crypto agenda since bitcoin was too volatile and too prone to price fluctuations to be taken seriously. The International Monetary Fund (IMF) also got to its knees and begged El Salvador to rescind any love he might have for bitcoin, claiming that the asset was too risky.

El Salvador has also faced stiff resistance from its own people, who have protested against the alleged “forced” use of BTC on the streets of San Salvador, the nation’s capital.

Tags: Bitcoin, El Salvador, Najib Bukele

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