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El Salvador Purchases Over 200 BTC

El Salvador president Nayib Bukele confirmed Monday that his government has purchased its first 200 Bitcoin (BTC) ahead of the Sept. 7 rollo...

El Salvador president Nayib Bukele confirmed Monday that his government has purchased its first 200 Bitcoin (BTC) ahead of the Sept. 7 rollout of a new law set to make the cryptocurrency legal tender. 

From Tuesday, bitcoin will be used as legal tender in El Salvador alongside the US dollar. Bukele tweeted that the country's brokers "will buy much more as the deadline approaches." The law designating bitcoin as legal tender says that all "economic agents" shall accept the cryptocurrency as a form of payment. It also says that tax payments can be made in bitcoin.

El Salvador now holds over $21 million bitcoin as BTC law comes into effect.

“Our brokers will be buying a lot more as the deadline approaches,” Bukele said, referring to the Sept. 7 timetable for fully implementing the new BTC legislation. El Salvador has already purchased its first 400 Bitcoin just ahead of the new crypto legislation approaching. President Nayib Bukele revealed that the country would be continuing to buy more of the leading cryptocurrency as the deadline approaches on September 7.

Key Takeaway

  • El Salvador’s Bitcoin legislation will come into effect today, on September 7, as the country moves to adopt the cryptocurrency as legal tender.
  • A $150 million Bitcoin fund was set out last week to facilitate conversions of BTC.
  • Although the new law has sparked protests, President Nayib Bukele continues on with a 400

Last week, a $150 million Bitcoin trust was introduced to support transactions between Bitcoin to the country’s national currency, the US dollar. El Salvador became the first country in the world to recognize the bellwether cryptocurrency as legal tender.

200 Bitcoin has been purchased ahead of the new legislation coming into effect, and president Bukele said that the country’s brokers would be buying more BTC as the deadline approaches. 

The Latin American country’s move to adopt Bitcoin as a national currency may have been praised in the cryptocurrency community, many Salvadorans have raised concerns about the use of the digital asset for illicit activities in the region. 

Protests have erupted in El Salvador just weeks ahead of the legislation coming into effect, as many believe that the move involves risk in an already struggling economy. Due to the fact that Bitcoin is a volatile currency, citizens worry about its instability.

A previous governor of El Salvador’s central bank said that adopting Bitcoin as legal tender puts its citizens “on a roller coaster.” Stanley Quinteros, a member of the Supreme Court of Justice’s workers’ union highlighted that the move is nearly universally opposed by Salvadorans, and appeals to those interested in corruption.

Despite the backlash from citizens, the new Bitcoin law is set to move forward on September 7, which would give Salvadorans the ability to hold the cryptocurrency as part of their long-term strategy or withdraw it in cash in the ATMs installed in the country. 

El Salvador further built a Bitcoin wallet known as Chivo, which would allow citizens who live abroad to send money back home to their families with reduced remittance costs. President Bukele previously announced that the Chivo Wallet is ready to be used as soon as the new law comes into effect. 

Bitcoin price indicates the bulls are back

Bitcoin price has recently broken out of a symmetrical triangle on the 4-hour chart, nearly reaching its measured target of an 8% ascent from the upper boundary of the technical pattern. The leading cryptocurrency has a targeted bullish aim at $53,000, and Bitcoin price is just 0.33% shy of reaching the optimistic goal.  The next target for Bitcoin price appears to be at 78.6% Fibonacci extension level at $56,955 should the buyers continue to push BTC higher.

Meanwhile, Bank of America recently outlined at least four potential benefits to El Salvador accepting Bitcoin. In a report published in July, the bank said the country’s adoption of BTC could streamline remittances, promote financial digitization, provide greater consumer choice and open the country to foreign investors.

The new Bitcoin Law gives Salvadorans the ability to hold the digital asset as part of a long-term investment strategy or withdraw it in cash at any of the 200 ATMs installed across the country. The country is also building infrastructure to support a state-issued Bitcoin wallet, dubbed Chivo. The Chivo wallet will have its own ATM that allows citizens to withdraw cash 24 hours a day without paying commissions.

BTC/USDT 4-hour chart 

Should Bitcoin price see a retracement following the recent climb, BTC would discover meaningful support at the 61.8% Fibonacci extension level, coinciding with the 20 four-hour Simple Moving Average (SMA) at $50,938.