President Nayib Bukele has lashed out at reports of defaults and announced that El Salvador has paid its $800 million debt in full.
El Salvador made one of the bravest decisions in the history of modern economics by adopting Bitcoin as a legal tender in 2021. The decision drew wide criticism from the agencies such as International Monetary Fund (IMF). The IMF even urged the North American country to drop Bitcoin as a legal tender citing risks to financial stability and consumer protection.
Flitch Ratings downgraded El Salvador’s long-term foreign currency issuer default rating (IDR) to CCC from B in Feb. 2022. The decision to downgrade the rating was primarily due to the $800 million eurobond repayment that matured this month.
Nayib Bukele Takes to Twitter
The President of El Salvador took to Twitter to call out the media that predicted the country would default on its loan. Nayib Bukele announced that El Salvador paid $800 million debt in full, along with interest. “They lie and lie and lie, and when their lies are exposed, they go on silence mode,” he said of the media.
According to Bloomberg, El Salvador previously paid a portion of the debt through government buybacks. It was made possible after the country secured a $450 million loan from the Central American Bank for Economic Integration.
The next payment is due in 2025. It still has $6.4 billion of foreign bonds outstanding.
El Salvador Accumulates Bitcoin
Nayib Bukele has continued to average down on Bitcoin throughout the crypto winter despite facing global criticism. In Nov., the President announced they would buy one Bitcoin per day. The country now holds 2,516 Bitcoin, according to Nayib Tracker, a website that tracks El Salvador’s Bitcoin portfolio.
El Salvador is down 47.31% on its Bitcoin holdings, bought at an average price of $43,530. Despite the unrealized loss of over $51 million, the North American nation is paving the way for mainstream crypto adoption by educating its students on Bitcoin.
In 2022, over 10,000 El Salvador students were educated on Bitcoin, the Lightning Network, nodes, double-spending, and events such as the Bitcoin halving.
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