On Tuesday, El Salvador legally recognized the use of Bitcoin as a national currency. And a craze of mixed reactions swamped the Internet.
As the world soaked in the announcement, something even more interesting and somewhat peculiar was also unfolding.
Twitter campaigns via the #7SeptemberBuyBTC hashtag urged crypto fans to buy $30 worth of Bitcoin — a move meant to support El Salvador’s official use of Bitcoin as legal tender.
The idea was to get more people to buy Bitcoin, consequently boosting its prices. Unfortunately, this didn’t go exactly to plan. Other digital assets suffered dips in rates as well.
Bitcoin prices plummeted
The brief experiment saw Bitcoin prices take a plunge on Tuesday.
Currently, Bitcoin is worth about $46,250 compared to $52,000 yesterday.
Ethereum — the world’s second-largest crypto — had risen 16% in the past week only to experience a dip on Tuesday.
Solana, another digital token, suffered a major hit after rising 69% in the past weeks.
There’s no explanation for the dips, but something is certain — you can’t blame them on El Salvador’s digital wallet misfortunes. The Latin American country made Bitcoin a national currency. No other digital coin was mentioned.
So why the price dip in other crypto assets? A mixture of better investor access, blind faith, and low rates is to blame.
Some factors that can shake crypto prices
Coinbase prices soared after an initial public offering in April, which saw retail investors massively buying crypto.
Also, many people use the Ethereum digital market network. So, anything can affect their prices (positively or negatively).
The make-believe world of NFTs (or non-fungible tokens) is also another factor that boosts crypto prices.
In other words, none of the price dips is tied to El Salvador’s attention-seeking adoption of Bitcoin as a national currency.
Then again, Bitcoin’s share prices have fallen. It’s now at 40%, down from 57% last year. This factor alone can trigger a rise and fall in Bitcoin prices.
But for Bitcoin prices to plummet on Tuesday is a testament that its success now depends on what happens in El Salvador. And that spells doom for the virtual coin.
Currently, El Salvador only holds 400 bitcoins with a value of 0.002%. Many Salvadorans are still opposed to the use of the digital coin as the official national currency.
What does this mean? There will be low Bitcoin usage in the near future. So, in the short-term, Bitcoin might not fare as well as some critics (and the president) project. However, crypto is a volatile market. Bitcoin may still go up in the long term.
