El Salvador Legalizes Bitcoin and Faces a Severe Price Crash!

El Salvador Legalizes Bitcoin
⟶ El Salvador Legalizes Bitcoin
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The Central American Country made it to the top trends today by declaring Bitcoin as its official currency alongside the US dollars. This swift move has initiated a long debate internationally. As El Salvador Legalizes Bitcoin, this makes them step up into a new phase of financial skepticism. What do you think the effect of cryptocurrency would be on the country? Here we’ll discuss all the crypto currency’s fluctuations, uncertainties, miracles, and their effect on El Salvador’s development.

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El Salvador Legalizes Bitcoin | How Did it Happen?

El Salvador’s popular president “Nayib Bukele” took the news to his Twitter handle and three minutes to midnight local time announced that the country is about to make up “history.” Plans started taking place back in June when the country approved Bitcoin as a tender for all goods and services alongside the US dollars. Moreover, the president has also announced $30 for all those who adopt the changes.

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Earlier he confirmed the purchase of 400 Bitcoins which are worth 20.9 million dollars today. The US dollars have been the country’s legal currency for the last twenty years. However, this risky move has spread up fear in the public too.

There is a probability of more than 6.5 million citizens rejecting this idea. So, they would be using US dollars. Citizens also held protests in the country against the decision amid concerns for the poor. Concerning the public, around 70% of people were against this step (according to a survey conducted by the Central American University).

“This Bitcoin is a currency that does not exist, a currency that will not benefit the poor but the rich.”

Jose Santos Melara (one of the protestors)
El Salvador Legalizes Bitcoin
Twitter reacts to El Salvador’s Bitcoin legalization.

The question is “Why is El Salvador using Bitcoin?” This is because the president believes that legalizing crypto can lead to a drastic spike in the country’s investment and financial development. Since last month, the government is making efforts to install above 200 Bitcoin Teller Machines also. The ATMs will allow the easy conversion of Bitcoin into US dollars without any commission.

The law says that all citizens would be able to pay the taxes in form of crypto. However, the shops will show the rates in form of digital currency. Furthermore, they are also launching their own digital wallet by the name “Chivo.” This wallet will offer free 30 dollars to encourage crypto adoption.

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Bitcoin fluctuations, uncertainties and a lot more!

Crypto is the most unpredictable currency one can ever invest in. As El Salvador Legalizes Bitcoin, the international media is shocked. Back in September 2020, a single bitcoin was worth $10,000. Then in 2021, it reached a very high value and then drastically dropped to about 30,000 dollars this year in July. The president of El Salvador mentioned that Bitcoin will help the country is stabilizing its finances as it will save around 400 million dollars a year. The real issue is that how the poor people will have access to it. For someone who could barely afford to eat, it is nearly impossible to invest in crypto.

The historically volatile currency can risk the economic stability of the country also. The potentially destabilizing facts of crypto are inevitable. The majority of the countries restrict the usage of crypto, particularly China. By far, investing in crypto is extremely risky. However, one cannot ignore the high profits worth thousands of dollars. Many of the citizens criticize Bitcoin usage but not everyone is against it. Back in late June, approximately 50,000 Salvadoranshad invested in the cryptocurrency.

Bitcoin Price Fell on Tuesday Amid El Salvador’s Adoption as Official Currency!

Earlier on Monday, 6th September 2021 Bitcoin prices marked the highest level since May 2021. It reached a value of 52,000 dollars. However, it seems like El Salvador’s luck isn’t working well as within 24 hours the Bitcoin prices dropped about 10%. The price is 46,930 dollars according to various sources.

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About the Author:

Mehrosh Ahmer

Former team member of NaeTaze.com
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