Bitcoin continues to collapse to 16-month lows
Bitcoin continues to collapse. In the past few hours it has touched the minimum levels of the last sixteen months. A stock market disaster that, however, there are those who try to avoid by moving in a politically unscrupulous way. It is about El Salvador, Central American country protagonist of an interesting story to say the least. For some fascinating, for others disturbing, with the fate of the strong leader of the Central American state that also depends on the fluctuations of the famous bitcoin.
200 billion dollars burned
Let’s start with the data. These days cryptocurrencies are at the center of a sell-off that led to the collapse of the stablecoin TerraUSD, precipitated within 24 hours of almost 70%, sparking panic in the world of virtual currencies. According to the CoinMarketCap website, something like $ 200 billion in value was burned in one day. Bitcoin, meanwhile, has plummeted to 16-month lows, causing a rush to abandon risky assets like tech stocks. The world’s most popular digital currency has dropped to as low as $ 26,970, the lowest level since 28 December 2020, to then settle at $ 27,870, its lowest since January 2021. In the last eight sessions, Bitcoin has lost a third of its value ($ 13,000).
El Savador in contrast
As has happened several times in the past, there are those who flee, selling after buying at the highest levels, those who hold the position and those who raise, buying at sale prices convinced that it is only an empty passage. It is the case of El Salvador, with President Nayib Bukele making a large Bitcoin purchase on behalf of the country he led himself. He bought 500 Bitcoins taking advantage of the minimum price, trying to take advantage of hypothetical and foreseeable future rebounds. In fact, he had to pay an average price of just under $ 31,000 for a total purchase of about $ 15 million.
This is not a sporadic case, but is part of a long-standing strategy prepared by the Central American country. On June 9, 2021, the government of El Salvador has published in the official gazette the legislation that makes the digital currency Bitcoin legal tender in the country. The law went into effect on September 7, 2021. El Salvador is the first country in the world to formally make bitcoin a legal tender, it’s too early to say what the implications are globally, but one thing is sure it is certain that this is the first domino to fall under wider global adoption.