As El Salvador’s President Nayib Bukele announced on Twitter, he is buying the state BTC reserves via his smartphone. That raises questions about democratic legitimacy.
Unthinkable in Germany, but apparently a reality in El Salvador: According to a Twitter post, El Salvador’s President Nayib Bukele has taken on the administration of the state’s BTC reserves himself. As Bukele wrote on December 5th on the short message platform, “El Presidente” is buying the state BTC on his smartphone.
Trading raises questions
That raises a number of questions. Has the parliament, which should oversee the budget in a democratically organized constitutional state, issued a general power of attorney for BTC trading to Bukele? Is there a limit? Buys Bukele the BTC from a crypto exchange like Binance, or does he resort to over-the-counter deals? And much more important: where exactly do the coins end up?
So far it is completely unclear who is entrusted with the custody of the BTC, which is not the property of Bukele, but that of the Salvadoran state and its taxpayers. Rumor has it that the custodian is a US-based custodian. This in turn naturally harbors existential risks for El Salvador’s digital gold treasure, as the US government could then obtain possible access.
A good knack for BTC trading
So far the self-proclaimed “CEO of El Salvador” seems to have a knack for BTC trading. Because, as Bukele announced – also via Twitter, of course – El Salvador is “in less than 24 hours […] everything OK”. El Salvador currently holds 1,220 BTC worth $ 62.7 million. This makes the Central American state one of the four largest BTC hodlers, only surpassed by Finland, Bulgaria and the Ukraine. This is based on data from bitcointreasuries.org emerged.
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