After El Salvador became the first country to recognise Bitcoin as legal tender on Tuesday, prices plunged from more than $52,000 per coin to $42,000, recovering roughly half of their lost. However, the deployment hit a snag in the early hours of the morning, with El Salvador President Nayib Bukele claiming that the digital wallet used for transactions was not functioning.
The selloff on Tuesday marks the most major halt in a rally that had raised Bitcoin over 75 percent since late July. According to cryptocurrency tracker CoinGecko, the overall market value of cryptocurrencies has dropped by nearly $300 billion in the last 24 hours.
Bitcoin prices today were about $46,757, down 11%, as the world's largest cryptocurrency made a slight recovery. Other digital currency followed suit, with ether falling over 11 percent to $3,471, and dogecoin and cardano falling 15 percent and 12 percent to $0.26 and $2.5, respectively. Over the previous 24 hours, the prices of Stellar, XRP, and Uniswap have all plummeted by 15-20%.
“Over the weekend, social media platforms were wary of a drop in traffic following El Salvador's big day, "According to Bloomberg, Edward Moya, a senior market analyst at Oanda Corp., wrote in a note. Some investors may have bought in anticipation of the country's Bitcoin law taking effect on Sept. 7 and then rushed to "sell the fact." "he stated
Experts claimed Bitcoin was still in a bull market as long as the price remained above $43,000.
Billionaire Mike Novogratz, chief executive officer ofGalaxy Digital Holdings and a long-time cryptocurrency bull, the market for digital coins has been strong over the last eight weeks and has become overbought. Individual investor interest soared as huge institutions jumped on board the crypto bandwagon, he said.
“Attack of the 50 Foot Blockchain,” by David Gerard, is the author of the book "told the Associated Press, El Salvador had nothing to do with Tuesday's Bitcoin volatility. “My initial thought was shenanigans, because shenanigans are always involved,” says the author "In an email to the Associated Press, Gerard said.
“Bitcoin does not respond to market forces or regulatory announcements,” says one expert ""Gerard explained." “That kind of price trend, when it drops dramatically in minutes and then rises again, is normally one of the large guys squeezing margin traders." Because Bitcoin is so lightly traded, it's possible that a huge holding made a large transaction to cash out, putting the market on a wild ride, Gerard said.