El Salvador, a country in Central America, is the first world economy or government to make Bitcoin legal tender. The value of bitcoin fell sharply on Tuesday after breaking a record of $52000 on Monday, which was at the highest level since May.
It all started when El Salvador decided to adopt bitcoin, the largest cryptocurrency, as a legal tender, making Bitcoin drop nearly 16% down on Tuesday morning, which shocked many and affected the trades.
MicroStrategy and Coinbase, the crypto stocks, also saw a down of almost 9% and 4%, respectively. Many Coinbase users felt the lagging in the transactions on Tuesday morning, which was the update issue and got corrected by Tuesday afternoon. Many other crypto-adjacent currencies like Kraken and Gemini users also felt the lag and delay issues during transactions.
Chivo is El Salvador’s government-run bitcoin wallet, which got some dysconnectivity and technical glitches while using it. We found that it was running some tests to make it available for later use. And the problem will resolve soon. And many investors sold their bitcoin as El Salvador brought nearly 400 bitcoin Tuesday.
El Salvador Nayib Bukele complained against the government for not backing up the bitcoin app on many platforms, including Apple and Huawei and tweeted to stock up the app or chivo wallet. Then Apple and Huawei decided to make it available. But there was a technical glitch in the app, which stopped many users from registering. Hence, the government took action unplugged and made it available to increase the servers and capacity. And later, it was possible to make the payments using the Chivo wallet or other platforms. Nayib Bukele took a tweet to share pictures of the user using bitcoin as a currency. The currency even worked in the forum of McDonald’s Corp and Starbucks Corp., which was a significant milestone.
But more than 1000 people came for the protest on the roads of El Salvador. The protest took a short turn while burning a tire and setting off fireworks in front of the Supreme Court, as many people don’t want to use this technology of the payment. They feel it’s more difficult for them to adopt this technique, don’t use the phones, or have poor internet connectivity. Many are ready to work with or without bitcoin. Some feel it doesn’t give them financial stability and may fuel illicit transactions in the future.
After the launch, the bitcoin prices again traded down 0.51% at $46,561.74. With this Ethereum, another cryptocurrency, fell 0.32% to $3,404.05 on Tuesday, where many platforms found some problems during transactions and delays.
El Salvador decided that all businesses can or have to accept bitcoin as payment for goods and services. However, citizens still have the lenience to use the US dollar, which has been their national currency since 2001. So, this made some of them relaxed. However, the technical issues with the app are making it less usable. Once that’s fixed, everything will run smoothly.