It was a great day for Bitcoin and crypto on Sep 07 as the leading crypto-asset by market cap got enforced as the legal tender in El Salvador. President Nayib Bukele has turned into one of Bitcoin’s biggest supporter lately and he organized the bill to be presented in the parliament, which grants Bitcoin the currency status alongside the USD in use. El Salvador will also promote Bitcoin infrastructure in the country and has launched an official Chivo Wallet to faciliate Bitcoin transactions. It doesn’t appear to be on-chain, but is reporeted to connect to the Lightning Network in some manner.
El Salvador Acquires 550 BTCs As National Reserve
El Salvadorean President Nayib Bukele also announced that his country has complete acquistion of 550 BTCs (worth $25M+ at current prices) for the national reserve. It’s most immediate use would be to faciliate conversion of Bitcoins into USD and vice versa amongst other things. The Bitcoin bill introduced has provision offering immediate conversion of received sats or BTCs to USD, if the transactor doesn’t wish to Bitcoins for any reason. This is the first time any Govt has held Bitcoin reserves and will go down in history books.
Crypto Market Brief Crash - $2.6B Positions Liquidated!
The market brings down it’s thunder as soon as the traders get complacent, especially the leveraged ones. Similar thing happened today as Bitcoin came tumbling down from $51K to $46.5 and Ethereum saw a fall from $3900 to $3400 currently. According to the Block’s Director Of Research Larry Cermak, more than $2.6B of positions were liquidated. The majority of them happened at Bybit.
Larry also said that the funding rates on the altcoins were surging, meaning that long positition traders were borrowing extensively from the market and it was a healthy flush, before the next leg up. The brief crash events like this happen, when a liquidation cascade develops, nuking positions down and causing a snowball effect.
Most Centralized Exchanges Stopped Working During Market Crash
A lot of Twitter users are reporting that major centralized exchanges went down and became unusable during the market crash - a sign that exchange services haven’t invested enough in their infrastructure to keep up with the rising user load. There are allegations of market manipulation and saving the large holders, however there’s no evidence available to support the claim.
Another user reported Coinbase (no surprises there!), Gemini, Kraken, Binance etc broke down compeletely at the time of turmoil and only FTX kept working to some extent. This is a warning sign of the leverage traders on these platforms as they are put in a very disadvantageous position with no possibility of funding their positions, close them or avoid liquidations. He also said that Panama shouldn’t be left behind and embrace innovation.
Republic Of Panama Might Follow In El Salvador’s Footsteps
In another solid development, the Central American Republic of Panama has also been reported to present a bill in the parliament for cryptocurrency regulation and their acceptance as payment methods in the country. Panamian politician Gabriel Silva presented the bill.
In the video message posted below, Mr Silva said that he wants to make Panama - a blockchain and crypto compatible country. This will allow Panama to prosper further, create economic opportunities and also enhance the transparency of the Govt by the reliance on immutable blockchain records.
That’s it from outside, let’s see you next week with more interesting happenings from the crypto industry. To stay updated, visit our website. Or join our Twitter and Telegram - News, Crypto Talk & Blockchain Gaming and Trading Central. Want to get an edge in crypto trading and profit generation? Consider, subscribing to our premium plan.