Peterson believes the implementation of Bitcoin will be complicated for El Salvador at first, as has happened with large governments. The Salvadoran government will track transactions in the Chivo wallet to combat the illegal use of the pioneering cryptocurrency.
The CEO of Bitcoin whale firm MicroStrategy recently announced that they purchased an additional 5,050 bitcoins for USD 242.9 million. In that way, the business intelligence firm increases its total holdings to more than 114,000 BTC, Michael Saylor said.
According to the Securities and Exchange Commission (SEC), MicroStrategy has added nearly 9,000 BTC to its treasury in the third quarter of 2021. Between July 1st and September 12th, the company invested around USD 419.9 million in Bitcoin.
They bought the coins at around USD 46,875 per unit, including all taxes and fees. The government agency stated that the company had acquired approximately 114,042 bitcoins at around USD 3.16 billion in that period. The average purchase price was about USD 27,713 for Bitcoin, including fees and expenses.
MicroStrategy’s momentum is essential to the performance of the public Bitcoin companies index. However, publicly traded mining companies performed the best. Marathon’s return was ten times that of Bitcoin, while Hut 8 doubled the appreciation of BTC in the last 14 months.
El Salvador Could Become a Developed Nation Thanks to Bitcoin
Bitcoin expert Anthony Pompliano spoke with Bitcoin Beach director Mike Peterson about the development and future of Bitcoin in El Salvador. That happened after the first cryptocurrency became legal tender in the Central American country.
Peterson said that El Salvador is still in the early stages of that new economy. However, he highlighted that the penetration of Bitcoin in the Salvadoran community is ten times deeper than anywhere else in the world. Still, he acknowledged that many new users are concerned that they misunderstand Bitcoin while others fear its volatility.
Undeterred, Peterson expressed that he believes that implementing that new technology will be disastrous in El Salvador. He mentioned the case of the US government, which cannot implement some things despite the resources available to it. The executive assumes it will be hard for El Salvador at first, as has happened with large governments and large technology companies, among others.
Salvadoran Bitcoin Investors Would Be Tax-Exempt
Investors in Bitcoin will not have to pay an income tax on Bitcoin, the government of El Salvador said. President Nayib Bukele’s legal advisor, Javier Argueta, wants to stimulate foreign investment through tax exemptions in Bitcoin.
Argueta said that a person who has Bitcoin and makes large profits would not have to pay taxes. He argued that this would help incentivize foreign investment in the Central American country.
The legal advisor reportedly noted that the government would actively track Bitcoin transactions in the official Chivo wallet. He stated that would help combat the potentially illegal use of the pioneering cryptocurrency.
The relevance of Bitcoin has led both institutional and individual investors to put their capital in that asset. MicroStrategy, Tesla, Marathon, and Hut 8 are some companies that have ventured to include crypto assets in their treasuries. Likewise, the Salvadoran government is pointing the way towards adopting the pioneering cryptocurrency in other latitudes.
By Alexander Salazar