El Salvador Mulls Following MicroStrategy’s Model To Buy More Bitcoin
El Salvador is considering increasing its Bitcoin holdings by issuing debt, following a suggestion from Max Keiser, a personal cryptocurrency advisor to President Nayib Bukele.
Keiser proposed that the country could follow MicroStrategy’s model of using debt to purchase Bitcoin, without using its own funds. He asked on social media whether El Salvador should issue a security backed by its current $600 million Bitcoin stack to fund additional purchases. Over 80% of more than 1,500 respondents to the informal poll supported the idea.
Currently, El Salvador holds 5,940 BTC, and President Bukele has committed to buying 1 BTC daily until the currency becomes too expensive to purchase with fiat. If the country adopts Keiser’s proposal, it would be the first nation to issue debt for Bitcoin acquisition, a move that carries potential risks. However, El Salvador’s record with Bitcoin-related projects is mixed, as it has yet to launch its “volcano bonds” aimed at financing Bitcoin City, a Bitcoin-focused metropolis. These bonds, announced in 2021, have been delayed multiple times due to unfavorable conditions.
Clever Robot News Desk 23rd November 2024
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