Top line
The cryptocurrency market registered surprising losses on Tuesday, as a wave of sales hit the prices of almost all currencies, triggering the gains that a retail craze had before the first day in El Salvador accepted Bitcoin as a legal tender.
Major cryptocurrencies, such as bitcoin, ether and Cardano’s ada, fell to 15% in a matter of minutes.
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Key factors
The value of the world’s cryptocurrencies plummeted to a low of about $ 1.9 trillion on Tuesday at 11:15 a.m. EDT, nearly 15 percent less than 24 hours earlier and reflects a loss of more than 410,000 million dollars, according to cryptocurrency website CoinMarketCap.
Leading the market value losses, the price of bitcoin fell 15% to less than $ 43,000, the lowest price in nearly three weeks, before quickly comparing some of the losses and settling at about $ 46,810 in at 11:50 am EDT, still 9% lower than the day before.
Meanwhile, Cardano’s ether, binance currency and ada fell between 13% and 18%, while Solana was the only witness to the increase in value, up 8% after an impressive preparation of almost 36% last week.
In the midst of the instant shock, Salvadoran President Nayib Bukele announced the country took advantage of falling prices to buy an additional 150 bitcoins, increasing its holdings to 550 currencies in total, worth about $ 25 million.
Sentiment began to hit Tuesday early, as El Salvador’s portfolio experienced technical difficulties within hours of its debut, forcing President Bukele to to advertise would be temporarily offline.
The increase in trading volume fueled speculation about institutions selling large holdings and even led to brief interruptions and delays in trading many of the world’s largest cryptocurrency exchanges, including Coinbase, Kraken and Gemini. .
Key background
The sharp overflow came less than a day after JPMorgan analysts warned in a note to customers that recently gathering altcoins (or cryptocurrency alternatives to bitcoin and ether) reflected the “foam and retail investor craze.” as opposed to sustainable market gains. “The August concentration of non-expendable tokens and the recovery of decentralized financial activity have helped not only the etherum, but also alternative cryptocurrencies that facilitate or plan to facilitate smart contracts, such as Solana, Binance Coin and Cardano said JPMorgan CEO Nikolaos Panigirtzoglou. Monday. “The previous phase of the retail investor craze towards the cryptocurrency markets was between early January and mid-May … and retail investors are making the cryptocurrency markets look frothy again.” After the retail investment mania attacks in January and May, the crypto markets fell by about 13% and 50%, respectively.
Tangent
El Salvador made history on Tuesday by becoming the first sovereign government to use Bitcoin as a legal tender: paving the way for residents to pay taxes and other debts with the cryptocurrency and allow hundreds of thousands of companies to the whole country would accept it as payment. In addition to its purchase of bitcoins, the Central American country has already marked the occasion with the launch of hundreds of bitcoin ATMs and the debut of a new cryptocurrency portfolio, Chivo, driven in part by the signing of digital wallets BitGo, based in California. Ahead of the bustling event, bitcoin bull billionaire Michael Saylor, CEO of business analysis firm MicroStrategy, met with retail investors on Twitter and encouraged them to buy bitcoins worth $ 30 to support the historical feat of El Salvador.
Crucial budget
“Bitcoin is lower in a ‘buy before the big event, sells the fact’ of reaction to El Salvador’s historic moment embracing cryptocurrency,” Ed Moya, senior market analyst at Oanda, said in an email Tuesday , adding: “Bitcoin fundamentals will remain intact as prices eliminate a new trading range between the $ 46,000 and $ 53,000 levels.”
To read more
El Salvador gets $ 21 million in cryptocurrency purchase as Bitcoin becomes legal tender (Forbes)
Solana leads a massive rally of Altcoin and Bitcoin, as JPMorgan warns that cryptocurrency markets are looking again with bubbles (Forbes)