Castro made a comparison between the performance of the pension system in Chile with that of Bitcoin. The senator considers that having invested his pension fund in BTC is nothing negative.
The Chilean senator for the National Renovation (RN) party, Juan Castro, said his son suggested he buy Bitcoin (BTC). To do that, the official invested 10% of his pension fund.
Castro said he gave the money to his son, who likes to bet on cryptocurrencies, to see how he would make it grow.
Castro’s decision to invest in cryptocurrencies sparked controversy in Chile. Although the legislator was sincere about his investments, he did not reveal the amount of Bitcoin he bought.
Castro stated that the performance of his money with the cryptocurrency is similar to what Pension Fund Administrators (AFP) achieve.
He stated that he is happy as the investment his son helped him make bore fruit. He added that he is getting a good retirement while they are both learning about cryptocurrencies. He considers that what he has done with his money is nothing negative.
Chile is one of those countries where the pandemic has caused the most severe economic damage. For that reason, the parliament approved of people withdrawing 10% of their pension funds. That would allow them to alleviate the difficult financial situation that the country is going through.
The first official withdrawal of funds in July 2020 benefited 10,408,556 people. The Chilean Superintendency of Pensions said that this generated incentives for USD 19,922 million.
Senator Castro took advantage of that situation to buy Bitcoin, which traded at around USD 11,116 in July 2020.
The price of Bitcoin started October with an increase of almost 8% in the first hours of that day. For the first time since September 20th, the market price of BTC returned above USD 47,400. Therefore, Senator Castro has increased his Bitcoin net worth by more than 76% since July.
Chile’s parliament has approved another three withdrawals of 10% of pensions between 2020 and 2021. That means there has been a disbursement of almost USD 50,000 million. The authorities are currently debating whether to approve the fourth withdrawal of 10% of pensions.
Chilean Pension System
Private companies, under the so-called Chilean AFP Association, have administered the Chilean pension model since 1981. That union organization brings together the Pension Fund Administrators societies.
The people affiliated with the AFP must consign 10% of their monthly income. That deposit will serve as the basis for calculating the amount of pension that people will receive upon reaching retirement age.
More Politicians in the Region Favor Bitcoin
Chilean Senator Castro is not the only one who has acquired Bitcoin, as other politicians in the region say they have bought it. Meanwhile, others have only shown their support for the pioneering cryptocurrency.
Regarding Argentina, economist and politician Javier Milei has repeatedly said that he loves Bitcoin. In addition, he has expressed that he considers that cryptocurrencies emerged as part of the evolution of money. Even former education minister Esteban Bullrich confirmed that he had Bitcoin in his investment portfolio.
The importance of Bitcoin is becoming increasingly evident in the world economy. The interest in it from representatives of the governments of Latin America is just one example of that.
By Alexander Salazar