El Salvador adopting bitcoin as an official legal tender has had an adverse effect on the coin’s value, sending it falling 10 percent, CNBC writes.
El Salvador was the first country to adopt bitcoin as official legal tender. But it sent the price of the coin falling by around 16 percent Tuesday morning (Sept. 7).
The coin was last down around 9.5 percent, trading at $46,892.04, CNBC writes, citing Coin Metrics. Ether, meanwhile, also fell 12 percent, hitting $3,441.21. And the report has crypto adjacent stocks like MicroStrategy and Coinbase also down 9 percent and 4 percent respectively.
And meanwhile, Coinbase users had been experiencing delayed or canceled transactions at higher-than-usual rates. However, the company said those issues had been resolved by Tuesday afternoon.
Early on Tuesday morning, El Salvador had disabled the government-run wallet Chivo in order to boost the capacity to the servers, which had been preventing new users from installing it.
The new law in the country will see all El Salvador businesses required to accept bitcoin for goods and services. That said, merchants will also be able to be exempt if they’re not able to take those payments technology-wise.
In doing this, the government has installed 200 bitcoin ATMs around El Salvador, having also recently bought 400 bitcoins worth around $20 million. The country is also preloading Chivo wallets with $30 in bitcoin for residents of the country who register.
Bitcoin advocates have said for a while that there’s a case for Latin American countries making use of crypto to perform certain payments like remittances, along with letting central banks with high currency depreciation have a new option.
Read more: El Salvador Struggles in Bitcoin Debut
A PYMNTS report from earlier on Tuesday saw El Salvador experiencing growth pains in its bitcoin debut, with the disabling of the Chivo wallet. President Nayib Bukele put the blame for the problems with Chivo on Apple, Google and Huawei’s app download platforms.