El Salvador's gold discovery could reach $3 trillion

El Salvador's recent discovery of potential gold reserves valued at over $3 trillion has ignited discussions about the future of mining and investments in Bitcoin (CRYPTO:BTC). 

President Nayib Bukele emphasised the economic impact of these untapped resources, suggesting that responsible mining could transform the nation’s economy. 

In a post on social media platform X, Bukele proposed repealing the 2017 ban on metallic mining, which he views as an obstacle to utilising the country's natural wealth. 

He referenced studies indicating that only 4% of El Salvador’s mining areas have been explored, revealing an estimated 50 million ounces of gold worth approximately $131 billion—around 380% of the country’s GDP. 

Bukele believes that full exploration could elevate the reserves' value to over $3 trillion, or 8,800% of GDP. 

“We’ve also found gallium, tantalum, tin, and many other materials needed for the 4th and 5th industrial revolution,” he stated.

The president highlighted El Salvador's location within the Pacific Ring of Fire as a contributing factor to its mineral wealth. 

While supporters view the discovery as a potential economic boon, critics express concerns about environmental impacts associated with mining activities. 

Bukele argued for sustainable mining practices to balance economic growth with environmental protection, although doubts remain about the actual size of the gold reserves. 

El Salvador's unique position as the first country to adopt Bitcoin as legal tender adds a cryptocurrency dimension to this gold discovery. 

Pierre Rochard from Riot Platforms noted that mining these gold deposits could significantly increase supply, unlike Bitcoin, which has a fixed supply due to its open-source code. 

Max Keiser, a Bitcoin advocate, suggested that El Salvador should monetize its gold reserves to invest in Bitcoin. 

He proposed selling convertible preferred shares to fund large-scale Bitcoin purchases, asserting that Bitcoin's long-term value surpasses that of gold. 

“El Salvador should monetize this $3 trillion in gold by selling a series of 0% convertible preferreds and buy as much bitcoin as possible under $200,000,” Keiser remarked on X.

At the time of reporting, the Bitcoin price was $97,647.33.