Hi Market Wrap readers! During the final two weeks of 2021, we’re using this space to recap this year’s most dramatic moments in cryptocurrency markets – and highlight the key lessons from this fast-evolving corner of global finance.
In Tuesday’s post, we explored how alternative coins or “altcoins” rallied during the first part of the year – illustrating just how far the year’s explosion in popularity for digital-asset markets extended beyond bitcoin, the largest cryptocurrency by market cap.
Today, we’ll show how bitcoin was able to break out of its two month-long price range of around $30,000 as El Salvador, the tiny Central American country that previously had used the U.S.
Bitcoin rose about 70% from a low of around $30,000 toward a high of nearly $50,000 in early September as traders reacted to the news from El Salvador – seen by many fans of the 12-year-old digital asset as a long-awaited validation of its potential to serve a global currency.
A growing number of users on social media platforms, including Twitter and Reddit, called for people to buy small amounts of bitcoin in support of El Salvador’s bitcoin policy, Bloomberg reported.
The takeaway for crypto traders from the July-August price action was that El Salvador’s decision to make BTC legal tender wouldn’t be enough to keep the cryptocurrency’s price elevated at $50,000.
Still, the nearly 7% BTC drop in September looked far less severe than the 50% price crash in April and May.
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Damanick is a crypto market analyst at CoinDesk where he writes the daily Market Wrap and provides technical analysis.
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