Zelaya Believes Bitcoin's Decline In Value Will Not Hurt El Salvador's Finances

Menteri Keuangan El Salvador, Alejandro Zelaya. (photo: twitter @AlejandroZelaya)

JAKARTA - El Salvador's Finance Minister Alejandro Zelaya on Monday, June 13 dismissed concerns that a sharp decline in bitcoin's value could damage the Central American nation's fiscal health.

In El Salvador, last September became the first country to make bitcoin a legal tender, alongside the US dollar, despite criticism from the International Monetary Fund and credit agencies.

"When they told me that the financial risks for El Salvador because Bitcoin was so high, the only thing I could do was smile", Zelaya said at a press conference, also cited by Reuters. "Fiscal risk is minimal."

Since last September, the government of El Salvador has bought 2,301 units of the cryptocurrency, which fell on Monday to its lowest value since 2020.

Zelaya cited an earlier estimate from Deutsche Welles that the country's bitcoin portfolio had lost about $40 million in value.

"Forty million dollars doesn't even represent 0.5% of our general national budget", he said.

The value of Bitcoin has fallen by about 50% since it became legal tender in the country.