A detailed relation of their bitcoin purchases over time can be seen here (lacking the 410 BTC latest purchase):
That brings the toll up to 1.801 BTCs so far, and yes, on the books, they are at a loss (even more so since the above data was using a BTC value of just over 43K$ for their calculus, and the current price is 34,5K$ (down 20%).

That does not mean they are in debt though (focusing on these BTC operations), but rather currently looking bad on their bookkeeping for their Bitcoin Trust. Allegedly, all these purchases have been made using their Bitcoin Trust, thus the overall bookkeeping value is currently below the value it should reflect. On top of that, they themselves have claimed that they had taken FIAT from the Trust to pay for the Pet Hospital and a bunch of schools, at a time when BTC was high and they had a conceptual surplus on the books (FIAT+BTC). Now the price drop plays against them on both fronts (BTC devaluation and FIAT usage when there is currently no surplus). How those bookeping numbers may shift to having potential consequences is yet to be seen though, and the hope, I guess, is that time sets things right.

Why?!

If looking from the fiat perspective, they would be in debt from the moment they've bought the BTC, since that's when they've paid the fiat.
If looking from Bitcoin perspective, nothing has change, since 1 BTC = 1 BTC.
What has actually change is that:
* the individuals holding Bitcoin are now at a potential loss (it will be real loss only if the spend)
* the prices seen in bitcoin will be bigger (since the calculation base is USD)

As said, it may look bad now as investment and it can be seen that they're at a potential loss. But it's not a real loss until the point the investment is liquidated. (1BTC = 1BTC, remember?)
But since the goal is using Bitcoin as a currency and the coins bought by the country are there for backing/helping the money flow, I see no loss there.

Their economic condition with the decline in BTC prices will definitely have an impact.  There is only one strategy that can be used to cover their losses which is to buy in large quantities at the price dip so as to drive positive vibes in the market with the source of power they use.  Countries that legalize BTC must definitely experience this, it will never be possible, so this is a natural thing.

Thanks for your information, but fiat debt can't be news for poletics. Because they need news to blame the government. What they started from the beginning of bitcoin's legal tender. I hope you understand what I want to mean. And as I already mentioned, it's just a speculation, and if this happens, other countries might take it as a thread to make it legal. What is my concern?


Thank you so much for your detailed and recent news regarding this topic. And I get what your opinion basically is. 

The key words here are "LONG TERM" as per _act_'s post

There is constant obsession surrounding Bitcoin v FIAT, so many people think if the
market moves they are up or down while still holding the same amount of Bitcoin.
as per NeuroticFish's post the market doesnt automatically affect the
amount of Bitcoin held by anyone at any one time.


I would imagine the opposition party can and will use the current down turn to
attack Bukele's government, this is normal and would happen anywhere.

Bukele will be able to defend their position on Bitcoin, he understands how the
markets move.

@Imran232, El Salvador was in trouble 20 years ago when it gave up its own currency, they are in trouble today, and probably will be in 10 years from today. Looking so narrowly and in the short term at things in the context of "the country is better or worse because of Bitcoin" really doesn't make sense.

Bitcoin can only be part of the solution, in this case as a tool that was primarily intended to save on remittance fees for their emigrants, and everything else is more in the realm of gambling in the long run. Your and many people's problem is that you look at Bitcoin only from the perspective of monetary value, and you completely ignore why it even exists.  Maybe it's time to read the white paper, if anyone is interested in that at all...

It is not as if the end of btc has come, am sure the president of El-Salvador must have taken this into account while making the decision to make btc their legal tender, before such a big step is taken (something that has to do with the entire countries economy) a lot of consideration, thorough analysis are being made to ensure utmost outcome, i don't think this decision was made on a light note hence proper precaution in case of situations like this must have been put in place.

the media circulating, the impact of the decline in el salvador debt bonds swelled to become one of the worst performers, but strangely when crypto was destroyed, el salvador actually bought bitcoin, president tayib bukele dared to buy bitcoin, maybe tayib bukele believed that one day bitcoin would high again, and will make their economy better again.

Yes, at this stage of market development it may seem to many that this is true and El Salvador really "unsuccessfully" invested his money, but this is not so. Firstly, this is a long-term investment and not a speculative one, so there is nothing to worry about, and secondly, we understand that this has already happened and more than once (especially those who have been here for a long time) understand that such recessions are only a correction and it is quite expected. There is no continuous growth anywhere, there is always a moment of change in rates, trends, and so on. Therefore, I think that El Salvador will still laugh at his critics when bitcoin takes another historical height.