IMPACT ON THE ECONOMY OF EL SALVADOR AFTER THE COLLAPSE OF CRYPTOASSETS

Greetings and welcome dear readers of this prestigious platform, today we will continue to address the adoption of Bitcoin as a legal exchange currency in some markets associated with countries that have opted for technological advances to promote economic and social development.

In this regard, it is no secret that the cryptographic world has been showing significant setbacks or falls in price, so that the fall of Bitcoin, which represents more than 50% from its historical peak, has generated losses of more than 200,000 million dollars in capitalization.

Consequently, BTC continues to show red numbers, where the price is already at $30000, which represents a drop of more than 9% in the last seven days, a scenario that is extrapolated to the rest of the cryptographic assets, so that the depreciation of the dollar price of these assets has led the market to enter levels similar to those reached in July 2021, where the market capitalization dropped to about $ 1.2 billion.

Based on the above, this negative scenario seems to have generalized a sense of fear that invades traders and bullish investors associated with cryptocurrencies, a scenario that in a certain way is also reflected in the stock market since the previous weekend, there was a sharp drop that generated the loss of more than 1000 points of the Dow Jones index in which many analysts think that these contradictory scenarios are the answers to the scenario or economic outlook that is envisioned in the United States of America in the medium and long term, where a great recession is foreseen that will substantially affect the economy of this country, aspects that we addressed in previous publications, without forgetting the uncertainty caused by the war between Russians and Ukrainians and the increase of the inflationary rate by the Federal Reserve of the United States.

If we review the opinions of certain analysts, including Willie Woo, it is expected that the price of cryptocurrencies continues to fall, so it is of utmost importance to be aware of the point or support where they stop, since the recovery of the value that has been lost can be accelerated, which is visualized in a long-term bullish scenario.

Now as we have analyzed up to this point the scenario of the price of digital assets is assumed as bearish in the short term and this pattern of behavior if we associate it with countries like El Salvador that adopted the Bitcoin as legal tender, would certainly be affected by the setbacks that occur in the market and substantial losses are already looming in the economy of Salvadorans.

So the economy of El Salvador under this scenario has been devalued by more than 40% of the original value, which increases a greater uncertainty where it is not yet known if investors have the ability to meet the debts previously assumed, so we are in the presence of some adverse effects that are determined by the management of a highly volatile market which impacts positively or negatively on the economy of countries that adopt the crypto currency as a legal exchange.

In this particular case, undoubtedly for El Salvador the setbacks in the price of Bitcoin become like sharp blades that fall and dematerialize in a certain way the project that has been running, however, beyond the scenario we are living today I believe that any investor who bets on BTC, will not lose his capital in the future since it is presented as a possible refuge of value with the passing of time and even more so if countries such as Russia adopt this currency to evade the restrictions that have been imposed on it as a result of the war that is taking place.

So the scenario is diverse and we must be attentive and informed about each of the situations or scenarios that are being presented in the cryptographic world and in the Bitcoin world in general.

Grateful with the community @project.hope and with all the management team of the same one that they motivate us to continue working in a mutual and balanced growth.