The price of Bitcoin dropped by 12% and it brought the price of BTC down to $43,000 in a broad market correction. The price drop happened on the day El Salvador made Bitcoin its official currency and it would work alongside the US dollars.
As of the time of writing this the official price of BTC was $46,401 and a market cap of 870 billion. In less than 24 hours Bitcoin has lost over $150 billion of its total market capitalization. El Salvador continued to buy the Bitcoin dip.
El Salvador’s Bitcoin rollout didn’t go as expected they had problems with their digital wallet system Chivo it crashed moments after going live as many citizens faced installation problems. As a result of the difficulties faced by citizens, the government had to take the entire system offline. The president of El Salvador Nayib Bukele disclosed in a recent Twitter post that the government and its developers are working on it at the moment. the tweet reads below
“We will take advantage of the early morning to make adjustments to @chivowallet, improve the user experience and the problems that occurred during the day. We will disconnect the system from 1 am to 6 am to make these adjustments. Our teams are ready. We hope tomorrow is much better.”
The Chivo mobile wallet is only available on the Google Play Store, which is the most widely used in El Salvador. The app is currently available for the Samsung Galaxy S20 and Galaxy S21 but the president said it will be available on all android mobile phones soon.
The Reasons Behind Bitcoin Correction
The major reason why the price of Bitcoin has dropped is not because of the system crash in El Salvador. As a matter of fact, the overall crypto market has tanked by more than 15 percent in the last 24 hours wiping out more than $200 billion from the market.
Over the last week, Bitcoin and altcoins have appreciated at an alarming pace. Any market correction at this point shouldn’t be surprising as investors resolve to profit booking. Other reasons why the market is witnessing a correction include:
The uptrend in the crypto market since mid-July has rallied in one direction without any major retraction. the uptrend is scary and some coins like Solana (SOL) have appreciated by more than 75%. Profit makers are in the selling game now, and the market is reacting.
Retail traders have been hyping up prices even before any fundamental developments in technology. This was enough to create a negative sentiment triggering a major sell-off.