What does the current slump mean for adoption?

It was September 6, 2021, when the Central American nation of El Salvador decided to go ahead and purchase 200 Bitcoin (BTC), worth about $10.3 million at the time. The day was hailed as momentous in the history of the crypto market and was met with much fanfare. In fact, many proponents claimed that the purchase was just an inkling of what really lay ahead in terms of a global crypto-driven economy.

However, a lot has changed since then, especially with BTC losing 55% off its value after scaling up to its November all-time high of $69,000. And, with Bitcoin’s value seemingly in a downward spiral at the moment, many critics have ramped up their criticism of El Salvadoran President Nayib Bukele and his decision to keep lapping up more BTC.

To this point, the country’s coffers now contain a total of 2,301 BTC, which are estimated to be worth a little over $67 million at current prices. In fact, reports suggest that Bukele’s gamble on Bitcoin seems to have already resulted in heavy losses equal to the country’s upcoming interest payments.

A rundown of El Salvador’s finances

Estimates suggest that the ongoing crypto downtrend which has caused Bitcoin to lose approximately 40% of its value since late March has deepened El Salvador’s cumulative losses and it’s crypto holdings to about $40 million, nearly equal to the country’s next coupon payment of $38.25 million which is due mid-June.

It is worth noting that since September 2021, Bukele and his team have poured in a whopping $105 million toward buying Bitcoin. However, the flagship crypto has dropped 45% since the country’s first purchase, cutting down the value of the nation’s BTC haul to just $66 million.

At press time, El Salvador owes bondholders a cumulative total of $382 million in interest, which is to be paid out by the end of this year. To this point, in the month of July alone, the country has a payment worth $183 million due.

El Salvador was reportedly in possession of $3.4 billion in its…