As mentioned in my previous post, on the 7th September 2021, El Salvador officially recognised bitcoin as legal tender. It appears that Panama is pushing through legislation to follow suit.
The lead up was super exciting, with the price climbing steadily in the lead up, but many saw the price ‘crash’ and gleefully reported that bitcoin was all doomed, and done for. (I’m looking at you, Time, Forbes or The Guardian). Was this caused by a cabal of evil bankers plotting bitcoin’s doom? Unlikely, but it’s fun to speculate.
I love that even El Salvador’s president called it. He predicted that the price would drop after his citizens had been distributed their bitcoin, and apparently used the opportunity to stock up on more bitcoin at a discount.
Did it really crash?
Hmmm…. looking at this image from Tuesday to today – that’s definitely a crash. From nearly $75k AUD to less than $65k AUD. My goodness! It’s definitely time to panic…!
Until we look at the month leading up to the 7th:
Huh. It seems that the price after this ‘historic crash’ is actually still higher than it was a month ago.
If we step back even further and look at prices over all time, you’ll see very quickly that it’s ALWAYS fluctuating. Yes it fluctuates more on some days than others… but for bitcoin, this was more of a stumble than a crash:
Bitcoin isn’t a stable investment as yet. It’s got huge highs and huge lows (as do I, according to my husband). But – with great risk there’s also the possibility of great rewards.
People panicked after the major crash at the beginning of 2018. Those that had the nerves/ability to stick with it (or even buy the dip!) would now be seeing a good return on their money.
There was a MASSIVE bull run (price going up relatively consistently) at the end of 2020. It’s settled some since then, but the price is still much higher than even the height of 2018.
Will it crash again?
As long as it exists, I think there’ll always be some fluctuation in bitcoin’s price. The day-to-day fluctuations will happen, and if it’s too stressful for you, then maybe crypto investing isn’t for you (totally fine – still follow for the joy of it though).
Personally, when things get a little hairy, I just don’t log in for a few days (weeks/months…). Honestly, I find that helps.
Is there a future in bitcoin?
I think it’s interesting that big American chains like McDonald’s, Pizza Hut and Starbucks have made it possible to use bitcoin in their stores in El Salvador. If that proves popular, and it rolls out across the world, what will that do for bitcoin adoption?
Hopefully provide a bit more stability for the price, and give the whole concept of cryptocurrency a bit more legitimacy.
Is our little guy growing up? I think he just might be.
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