By late morning,the issues appeared to have been overcome,and President Nayib Bukele tweeted that the app was again available for download.
The largest cryptocurrency fell as low as $US43,050 ($58,303) in New York on Tuesday,before paring losses. Bukele said his country had taken advantage of the crash to “buy the dip”,adding 150 coins to take its total holding to 550,worth about $US26 million.
The Bloomberg Galaxy Crypto Index,which tracks some of the largest cryptos,lost as much as 19 per cent,while other smaller digital assets also sold off.
El Salvador’s plan represents the biggest test for bitcoin in its 12-year history. Both enthusiasts and detractors of cryptocurrencies are monitoringthe experiment to see if a significant number of people want to transact with bitcoin when it circulates alongside the US dollar,and whether it brings any benefits to the violent,impoverished Central American nation.
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If the experiment is a success,other countries may follow El Salvador’s lead. Its adoption will get an initial boost from the government’s bitcoin wallet Chivo,which comes pre-loaded with $US30 worth of the currency for users who register with a Salvadoran national ID number.
Businesses will be required to accept bitcoin in exchange for goods and services and the government will accept it for tax payments. The plan is the brainchild of El Salvador’s 40-year-old president,who says it will draw more people into the financial system and make it cheaper to send remittances.