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El Salvador makes Bitcoin legal tender

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Re: El Salvador makes Bitcoin legal tender

#231

Post by UncleMeat »

rawtxapp wrote: post #191
Sebb767 wrote: post #186

Earlier quoted context omitted.

> so there will NOT be a transaction fee involved as you are just moving within a national reserve with a national exchange. For buying and selling Bitcoin, possibly. Transactions with Bitcoin will still have the usual transaction fees, as you still need to pay the miners verifying/realizing them.

They are using lightning network which allows almost instant and practically free Bitcoin payments.

Why would somebody who doesn't have a bank account be more capable of using a provider on the lightning network?

Re: El Salvador makes Bitcoin legal tender

#232

Post by HWR_14 »

cft wrote: post #115
kwhitefoot wrote: post #59

Earlier quoted context omitted.

Where I live ordinary bank transactions are free for ordinary consumers. I never pay a transaction fee or any annual fees. My bank used to charge an annual fee for a credit card but they have stopped charging now. In fact in my whole life (I'm 65 so about 50 years of having bank accounts) I have never paid transaction fees for ordinary transactions (in the UK and Norway).

Where I live (USA) I tried to transfer money between my Wells Fargo account (that charges large fees for foreign ATM withdrawals) and a credit union account (that required heavy bureaucracy to open a business account, that's why my main accounts are in Wells Fargo, but the credit union withdrawals at the foreign ATMs are free). Wells Fargo offered Zelle for ACH but I got confused. Then I tried transferring through Ro…

Weird. Have you thought about using Wells Fargo's web interface to send the money? It's usually not hard to do if you have two account numbers.

Re: El Salvador makes Bitcoin legal tender

#233

Post by lowdest »

Remittances are a significant part of the El Salvadoran GDP. As a percent of GDP, remittances have been up to 21.8% of total GDP in recent years [1]. If encouraging Bitcoin reduces the 5-10% typical remittance fees charged on 20% of GDP, that could be a 1-2% boost to GDP purely through legislation.

Even if it doesn't last, it does force remittance companies to become competitive, which will benefit El Salvador for years to come.

[1] https://data.worldbank.org/indicator/BX.TRF.PWKR.DT.GD.ZS?lo...

Re: El Salvador makes Bitcoin legal tender

#234

Post by kragen »

angry_octet wrote: post #79

Amazingly shortsighted. The primary beneficiaries of this will be organised crime, who will now be able to wash the Bitcoin via El Salvador to convert it to dollars, which they can use to buy trade items and export the profits. The number one export of El Salvador is actually people. If they were concerned about remittance fees they could just set up a bank in the US with low fees, instead of getting kickbacks from O…

Remittances are one of the best use cases for bitcoin; my comment at https://news.ycombinator.com/item?id=27448744 goes into more details.

Bitcoin mining is mostly a subsidy to renewable energy (fossil fuels are too expensive to make fossil-fueled bitcoin mining profitable), so although I could be wrong, I expect it to ameliorate global warming, not worsen it.

Re: El Salvador makes Bitcoin legal tender

#235

Post by tiku »

blocked_again wrote: post #199
rawtxapp wrote: post #191

Earlier quoted context omitted.

They are using lightning network which allows almost instant and practically free Bitcoin payments.

Asking as a noob, isn't the whole point of transaction fees to prevent malicious actors from flooding the network with spam. How does lighting networks prevent that from happening and why can't one use a smiliar approach for the actual bitcoin blockchain?

This is called sharding in Ethereum and Zilliqa I believe.

Re: El Salvador makes Bitcoin legal tender

#236

Post by Growling_owl »

This is historic!

Now a country has BTC as legal tender, add to that the 700 B marketcap and the fact that it cannot be banned because nobody has enough political capital to piss off millions of holders.

We are in a new era. The social messaging out there is BTC vs Central Banks and maybe we'll get to that fight someday in the future, but in the meantime BTC is cannibalising Gold which was always the go to option for Libertarians, Government haters and Central Bank critics and opponents.

In my opinion Central Banks have nothing to worry, at least with regards to BTC. By the time BTC takes all of gold marketcap it won't post the outsized returns that it has up to now (regardless of the deflationary protocol) and so people will stop rushing in.

Re: El Salvador makes Bitcoin legal tender

#237

Post by gruez »

yokem55 wrote: post #69
gruez wrote: post #23

Earlier quoted context omitted.

And before people ask, it uses the lightning network so it's non-custodial.

If you run your own lightning node, lightning is non-custodial. But strike is just a wallet that uses their own lightning node. So, if using strike, strike has custody of your funds.

>If you run your own lightning node, lightning is non-custodial. But strike is just a wallet that uses their own lightning node.

I don't know the implementation details of the strike app, but I don't see why you can't keep the signing keys on the device itself (as opposed to the server), and the server is only used for communication with the bitcoin network. That way you don't need to run a lighting node, but they don't control your funds either. Thin wallets use this model I believe.

Re: El Salvador makes Bitcoin legal tender

#238

Post by jasonlaramburu »

random_kris wrote: post #53
jasonlaramburu wrote: post #40

Earlier quoted context omitted.

LN still requires periodic on-chain transactions to close and open payment channels. So either these costs are being passed along to the users in El Salvador or the wallet provider is subsidizing it.

I run 1 node and in a year I haven't yet had to reopen an existing channel. And 3 channels are good enough for most

Are you buying daily essentials using LN, or running a small business? Also how could someone in El Salvador run a node without reliable electricity and internet? Also remember that the hardware cost of a full node is likely more than a month’s wages.

Re: El Salvador makes Bitcoin legal tender

#239

Post by triceratops »

HarryHirsch wrote: post #62
ramayac wrote: post #49

Earlier quoted context omitted.

Avoiding the high fees of remittances when families send money to their loved ones back home.

People have always used Western Union, for which the charges are ten dollars or so, that's bearable. And, yes, they do have SMS banking in Salvador.

> the charges are ten dollars or so, that's bearable.

Sorry, but no that's an extraordinarily privileged take. $10 is a lot of money for just transmitting some USD. And it goes a long way in El Salvador. I highly doubt the average remitter is sending more than $500/month, so it represents a 2% tax. I only consider $10 an acceptable fee if I'm sending tens of thousands of dollars.

There isn't any currency conversion because El Salvador's official currency is USD. Assuming it's WU on both ends there's no settlement risk. It sounds like pure greed.

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