Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

El Salvador makes Bitcoin legal tender

bbc.com

Post reply on HN
Print view View original

251–260 of 732 posts

Re: El Salvador makes Bitcoin legal tender

#251

Post by ddtaylor »

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.

LN requires opening and closing channels, each of which have to be done as a regular Bitcoin transaction. The value proposition of LN is that repeated transactions with the same entity (or some subset of) can be done without high fees, but considering almost nobody is currently using LN that doesn't change things right now.

Re: El Salvador makes Bitcoin legal tender

#252

Post by wokwokwok »

spmurrayzzz wrote: post #197
ashtonkem wrote: post #190

Earlier quoted context omitted.

Transaction fees come from the miners who will put your transaction in a block and mine it for you. Creating your own reserve changes nothing for this. Unless if you’re going to do a bunch of off chain stuff, which seems pointless.

Lightning network liquidity should actually help solve this. If you maintain a reserve and open a ton of payment channels for folks (those HTLCs are all on-chain), this drastically reduces impact of confirmation time and fees.

Should?

Is that a speculation? Surely if they’re not doing this for the first time ever on an entire country?

Someone has already used a large scale lightning network before right?

Re: El Salvador makes Bitcoin legal tender

#253

Post by m3kw9 »

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.

The problem here lies when the merchant want to derisk btc/USD by often converting it back to USD after a transaction. That causes a miner fee, there is a penalty in breaking the lighting channel.

Re: El Salvador makes Bitcoin legal tender

#254

Post by JumpCrisscross »

rahimnathwani wrote: post #206
miked85 wrote: post #157

Earlier quoted context omitted.

The digital dollar has been here for years. I couldn't even tell you the last time I carried paper currency.

The dollar is a central bank currency. Numbers in a retail bank's ledger are not digital dollars. They represent an obligation of the bank, and not direct ownership of dollars. Digital dollars exist, but only banks can hold them, as they're the only ones with accounts at the central bank. The rest of us use retail bank accounts, which are the equivalent of custodial wallets in the crypto world.

> dollar is a central bank currency

The term "dollar" encompasses central bank money (including but not limited to banknotes) as well as private money.

> Numbers in a retail bank's ledger are not digital dollars

Yes, they very much are. Modern money creation is public-private and only semi-centralized.

Re: El Salvador makes Bitcoin legal tender

#255

Post by kragen »

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 article claims that WU's fees in El Salvador average 10% of the remittances. You can read about my experiences with bitcoin vs. WU in https://news.ycombinator.com/item?id=27448744.

Re: El Salvador makes Bitcoin legal tender

#256

Post by KingOfCoders »

wraptile wrote: post #204
hn_throwaway_99 wrote: post #63

Earlier quoted context omitted.

The idea that "normal people" will be able to use bitcoin at all without getting their private keys stolen is laughable. Think of how often online bank accounts get hacked in the US, except the difference now is that your money is gone, permanently.

How do you think bank accounts get hacked? It's much easier to yank a password/credit card number people use daily. The benefit of private key is you only need to use it once. Then store it away in a safe or _bank_. More UX will develop over time as adoption grows. We already have hardware wallets that even babies could use. Finally you somehow imply that FIAT theft doesn't happen. Even in recent modern history peopl…

"More UX will develop over time as adoption grows. We already have hardware wallets that even babies could use."

The difference is this: If people have a hardware wallet they use digitally they think it's like a bank account on their phone. They do not realize that with that wallet if the wallet is gone so is the money. Wheras if the phone is gone, nothing happens to their money.

Re: El Salvador makes Bitcoin legal tender

#257

Post by hayyyyydos »

JKCalhoun wrote: post #201
miked85 wrote: post #157

Earlier quoted context omitted.

The digital dollar has been here for years. I couldn't even tell you the last time I carried paper currency.

If I hand a cashier a physical dollar, no fee to me. Not so with your so-called digital dollars. An actual digital dollar would have no transaction fee whatsoever.

> An actual digital dollar would have no transaction fee whatsoever.

So, something BTC is unable to provide?

Re: El Salvador makes Bitcoin legal tender

#258

Post by gruez »

jasonlaramburu wrote: post #40
spottybanana wrote: post #35

Earlier quoted context omitted.

What the normal people will use in the beginning is going to be non-custodial LN based solution like strike. Minimal fees, easy to use. If you get a bit more, move to custodial LN wallet/onchain transactions. More fees, more security and less trust. And once you have too much BTC start storing them in an offline cold storage.

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.

While you do need to close/open payment channels if you want to move the funds off the lightning network, I don't really see why you'd need to "periodically" do it. Lightning channels can stay open indefinitely so you can theoretically park your money on there indefinitely.

Re: El Salvador makes Bitcoin legal tender

#259

Post by whoisninja »

blocked_again wrote: post #18

> The El Salvador President has previously said the move will open up financial services to the 70% of Salvadoreans who do not have bank accounts. Right. People who can't even afford a bank account would now all be using financial services by paying 10 dollars per transaction.

living in a priviliged bubble, can't even open a website to check Bitcoin fees and what lightning network is. why strike is #1 app in their country.

main chain fees is $1 right now, and lightning tx are almost free: https://mempool.space/

Re: El Salvador makes Bitcoin legal tender

#260

Post by kragen »

macspoofing wrote: post #123

And that will fix what exactly? I'm not against it, I guess. I just don't get the point of it and what problems it fixes for El Salvador.

Remittances are a big part of El Salvador's economy, and they're expensive and risky. I wrote about my Argentine experience with these issues at https://news.ycombinator.com/item?id=27448744
Post reply on HN