El Salvador purchases $50 million in gold to diversify its reserves and mitigate Bitcoin risks.

Against the backdrop of a long-term Heavy Position in Bitcoin, El Salvador is balancing its International Reserve structure through gold investments. The country's Central Bank recently announced that it has purchased nearly $50 million worth of gold, marking an important step in its efforts to diversify reserves and ensure financial stability.

Gold Purchase Details and Reserve Status

The Central Bank of El Salvador confirmed on social media that it has purchased 13,999 ounces of gold, bringing its total gold holdings to 58,105 ounces, valued at approximately $207 million at current gold prices. This is the first time the country has increased its gold holdings since 1990, coinciding with gold prices hitting new highs, approaching $3,600 per ounce.

Central Bank data shows that as of July 2025, El Salvador's net international reserves amount to 4.7 billion USD, of which approximately 700 million USD is in Bitcoin assets. Compared to 3 billion USD in the same period in 2024, the reserve size has increased significantly.

Strategic Adjustment from Bitcoin to Gold

Since becoming the first country in the world to adopt Bitcoin as legal tender in 2021, El Salvador has been actively expanding its Bitcoin holdings under the leadership of President Nayib Bukele. However, the extreme volatility of Bitcoin prices has raised doubts about the stability of its reserves.

Analysts believe that the recent increase in gold holdings is intended to send a strong signal to international partners and to establish a more stable value storage tool outside of crypto assets.

Global Central Bank Gold Accumulation Trend

El Salvador's actions are in line with global Central Bank trends. Data from the World Gold Council shows that over the past two years, central banks around the world have purchased more than 1,000 tons of gold each year, setting a historical record. Gold now accounts for nearly 20% of global Central Bank reserves, second only to dollar assets.

Goldman Sachs' recent report indicates that under the current political and economic environment in the United States, central banks and financial institutions may continue to shift funds towards gold, reducing reliance on dollar assets, with gold prices even expected to surpass $5,000 per ounce.

The Complementary Role of Gold and Bitcoin

For El Salvador, gold and Bitcoin can form a complement in the reserve system:

Bitcoin: High growth potential and decentralized characteristics make it suitable for long-term appreciation and financial innovation.

Gold: Low volatility and hedging properties make it suitable for stabilizing balance sheets during market turmoil.

This dual-asset strategy may become a new model for emerging market countries to manage reserves in the digital asset era.

Conclusion

El Salvador has invested $50 million in gold, which not only balances its Heavy Position strategy in Bitcoin but also responds to the global trend of increasing gold reserves. As gold prices continue to rise amid the uncertainty in the Bitcoin market, the country's diversified reserve strategy may serve as a reference for other nations.