El Salvador Faces Turmoil as Bitcoin Value Plunge

El Salvador's bet on bitcoin is looking more and more risky as the cryptocurrency's value plunges.  

Last year, the Central American country became the first in the world to make bitcoin legal tender for all transactions.  

In recent weeks, the overall crypto market's value has fallen rapidly and is now worth $930 billion compared to $3 trillion in November. 

Bitcoin, by far the most popular cryptocurrency, has lost about two thirds of its value. 

In 2021, El Salvador's president, Nayib Bukele, sought to change its legal tender to the digital asset.  

The government said on Twitter it bought 2,301 Bitcoin and has openly advocated for using the virtual currency as an investment option. 

The already debt saddled country now faces a loss of about $56 million on its bitcoin holdings, according to Bloomberg's calculations. 

Bukele does not see the massive slump in valuation as a problem for the country and its coffers.

He tweeted that the country's loss from bitcoin is not a reason to avoid investing in it. Instead, Bukele suggested purchasing more of bitcoin.  

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