Does a bitcoin rally to $100K repay El Salvador’s IMF loans?
Will a rising bitcoin price cure El Salvador’s indebtedness to the International Monetary Fund (IMF)? Earlier this week, Tim Draper claimed a rally to $100,000 per bitcoin would allow the country to repay its IMF loans “and never have to talk to them again.” The claim sparked a discussion about how much debt El Salvador owns — and how much bitcoin can contribute to easing its burden. With some generous math, Draper’s claim that $100,000 bitcoin would allow IMF repayment has superficial merit. Specifically, El Salvador owes 107.7 million SDRs to the IMF worth 1.35049 USD apiece. In other words, the country owes approximately $80 million to the IMF. Switching to the asset side of the country’s financials, El Salvador claims to own 5,913.76 BTC, each of which currently trades at $67,973. So if BTC were to rally $32,026 and hit Draper’s $100,000 threshold, El Salvador would gain $189 million from its holdings, which is a larger number than its $80 million of IMF debt. ...