Nearly $240 billion in value was wiped from the cryptocurrency market on Tuesday as El Salvador contended with a bumpy rollout of Bitcoin as legal tender and major crypto exchanges saw widespread global outages.
The broad market for cryptocurrencies fell from more than $2.3 trillion in value to below $2.08 trillion by 4 p.m. ET, according to data from CoinMarketCap.com — down nearly 12 percent in a 24-hour period.
All of the major cryptos were down, except for Solana, which has soared more than 300 percent over the past month. Solana late Tuesday was trading around 7 percent higher on the day.
Bitcoin, meanwhile, fell by as much as 16 percent Tuesday morning, but slightly recovered and was exchanging hands late Tuesday down 9 percent, at about $46,800 per coin.
Ethereum was about 13 percent lower as of 4 p.m., at about $3,420 per coin. Dogecoin was down more than 19 percent on the day, at $2.47 per token.
The sharp selloff came on the same day as El Salvador’s highly anticipated official rollout of Bitcoin as legal tender in the country.
The launch came with some stumbles as the country’s official e-wallet app was unavailable Tuesday morning on major app stores like Apple’s and Google’s.
And then El Salvador temporarily disabled the app, called Chivo, to increase the capacity of its servers to meet demand, President Nayib Bukele announced in a tweet. The lack of capacity was blocking users from installing the app, he explained.
“Any data they try to enter at this time will give them an error,” he said. “This is a relatively straightforward problem, but it cannot be fixed with the system connected.”
Earlier Tuesday, El Salvador’s government had bought 400 Bitcoin, worth at the time about $21 million, Bukele announced, making it the first country to put Bitcoin on its balance sheet and hold it in its reserves.
After the price of Bitcoin began to drop Tuesday morning, Bukele announced the country bought another 150 Bitcoin.
Bukele also tweeted out images Tuesday of businesses, including Pizza Hut, embracing the country’s adoption of Bitcoin. But not all was so cheery, with Reuters reporting more than 1,000 people marching in the capital city of San Salvador to protest the adoption of Bitcoin.
Protesters said the cryptocurrency would benefit financial speculators, but not everyday people. Polls show many Salvadorans worried about the stability of the currency, which can gyrate wildly in a day — as seen on Tuesday. That instability has also sparked the worry of some economists.
But others say the adoption of Bitcoin will help people in a poor country invest in global markets.
Leah Wald, CEO at Valkyrie Investments, told CNBC that wasn’t surprised by Bitcoin’s plunge in price after El Salvador’s rollout.
She noted that the country’s population is less than New York City’s and that many residents live in poverty and don’t have the resources needed to participate in Bitcoin.
“Transaction fees, processing times, and other hurdles also make this feel more like a beta test rather than a solution to many of the problems plaguing the country’s poor,” Wald added.
In addition to the El Salvador news, major crypto exchanges Coinbase and Kraken both said Tuesday they experiences some delays and outages that affected transactions on their platforms.