El Salvador's Bitcoin policy has reached its fourth anniversary, and the results continue to spark controversy. On this anniversary, the government purchased Bitcoin once again, this time appearing to have a clear intention, full of a sense of "showing up."

Recently, President Nayib Bukele and the National Bitcoin Office announced a symbolic purchase of 21 Bitcoins to echo the total Bitcoin supply cap of 21 million. The government has consistently maintained a one coin per day purchase strategy, which has continued since March 2024. According to official statistics and blockchain data, El Salvador currently holds 6,313 Bitcoins, valued at approximately $700 million at current market prices. Although this is a small amount in the national budget, it carries significant political implications.

However, this buying behavior contradicts several provisions of the International Monetary Fund. The $1.4 billion loan agreement signed last year requires the public sector to stop actively purchasing Bitcoin and to freeze further purchases. This agreement also prompted the government to amend Bitcoin laws, making it voluntary for merchants to accept it, and plans to end the Chivo wallet project and liquidate the Fidebitcoin trust.

Despite this, the buying behavior continues. This has drawn the attention of the IMF and external observers regarding future loan disbursements, as compliance reviews will continue until 2027. The IMF's latest report indicates that El Salvador is expected to have spent about $300 million on Bitcoin since 2021. While the unrealized gains from these expenditures exceed $400 million at current market levels, independent assessment remains difficult due to limited transparency.

The government's disclosure of Bitcoin activities is still incomplete, although the public dashboard has been launched. The report also mentions that these unrealized gains may be affected if market prices decline.

In order to enhance security and public transparency, the national Bitcoin office redistributed the Bitcoins it held to multiple addresses at the end of last month, with about 500 Bitcoins in each address. The official explanation stated that this move is to address potential threats posed by future quantum computing, and these new addresses have been published on a public dashboard to increase transparency of the custody. However, opinions on these actions are mixed; some welcome the transparency of the dashboard, while others believe the reasons related to quantum computing are overly precautionary and that clearer audit standards are needed.

Looking back on the experience of adopting Bitcoin as legal tender over the past four years, El Salvador still divides opinions. Supporters believe the country has benefited greatly from this Bitcoin initiative, while critics warn that it could lead to troubles with international creditors. El Salvador's Bitcoin policy is still seen by many as bold, but it is also full of controversy. What do you think? Feel free to leave a comment to share your views!