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El Salvador makes Bitcoin legal tender

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Re: El Salvador makes Bitcoin legal tender

#371

Post by UncleMeat »

kragen wrote: post #351
UncleMeat wrote: post #292

Earlier quoted context omitted.

> fossil fuels are too expensive to make fossil-fueled bitcoin mining profitable This is incoherent. Nothing ties these prices together. If tomorrow the price of BTC goes up 1000x, the price to buy a joule of energy via burning coal doesn't change at all.

The ratio of joules of energy to bitcoin mined isn't fixed; it's varied to keep the rate of bitcoin mining constant, although not from one day to the next. If the price of bitcoin goes up 20% in the next two weeks, then bitcoin mines that would have been running at a 10% loss start running at a 10% profit instead, which increases the hash rate and then the difficulty. This increases the amount of energy (and hardware…

But that's true for renewable energy too. Nothing about the two energy sources are different.

Either energy prices are decoupled from mining rewards, in which case reduced prices of either fossil fuels or renewables (or increased price of BTC) means more profit for miners or energy prices are coupled to mining rewards, in which case changing prices of fossil fuels or renewables means nothing to miners.

Please tell me why mining does not incentivize cheaper fossil fuel energy technology in the same way it supposedly incentivizes cheaper renewable energy technology.

> that you ended up so confused

I am not confused. I've heard this argument 1000 times. It is bogus.

Re: El Salvador makes Bitcoin legal tender

#373

Post by dheera »

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.

The bigger concern might be that Bitcoin offers zero privacy; anyone you pay with Bitcoin can know exactly how much you have in your account, which is a huge personal security risk, possibly especially so in El Salvador.

If people use Bitcoin to store their life savings instead of banks, expect gangs to run around robbing people for their bitcoin because all it takes is one unscrupulous vendor to inform the gangs of your net worth.

Re: El Salvador makes Bitcoin legal tender

#374

Post by doomroot »

UncleMeat wrote: post #306
marcinjachymiak wrote: post #136

Earlier quoted context omitted.

Lightning does work. I've used it myself as have many others. You should really work on explaining what it is you actually mean by that statement instead. Apparently they are using Lightning and a service LN Strike that recently launched. https://twitter.com/starkness/status/1402635954653904902?s=2...

3 transactions a second is 100m transactions per year. So everybody on the planet gets one transaction per 70 years. So everybody gets one transaction in their lifetime to open a channel to a lightning network provider and that's it.

You can do far more than 3 tx per second in mainchain. Look into channel factories. 100s of trustless lightning network channels in 1 onchain transaction. Layer approach is the only viable scaling solution.

Re: El Salvador makes Bitcoin legal tender

#375

Post by reedjosh »

jokethrowaway wrote: post #214
janeroe wrote: post #164

Earlier quoted context omitted.

> The idea that "normal people" will be able to use bitcoin at all ... is laughable. The idea that "normal people" will be able to use cash at all is laughable. The idea that "normal people" will be able to use gold coins at all is laughable. And yet, many use (or used to) and don't need a mommy state to tell them what to do.

I'm all for getting the government out - but cash or gold is way easier to use. If you have a political problem, you need to solve it politically. You can't hack it with a technical solution or politicians and their rich friends will just find a way to use it against you (like it's happening with btc, enjoy limitless tracking and the rich elite profiting from btc as much (if not more) than you) or ban it (like it hap…

> you need to solve it politically.

And what do you do when politics are fully captured by corporate and oligarchical interests?

The majority of bitcoiners see no way out of our current political system. The dollar underpins the US hegemony.

Bitcoin wouldn't be necessary if the government would allow alternative currencies, but until bitcoin, it had squashed numerous attempts at alternatives.

So to say that we need to solve it politically misses the point. Bitcoin is a solution to solve what is seen as a political mess. Further, politics is just non-violent war. This _is_ a political method.

> their rich friends will just find a way to use it against you

I don't entirely disagree. I see bitcoin as a start. The lightning network already brings some anonymity to transactions, but it could be made to do better.

Monero (XMR) is a privacy based crypto that already does so and can currently do 1500tps on chain (BTC does ~7). Crypto is war against oligarchs motivated by failed traditional politics. Monero and other techs like decentralized exchanges are a step up in weaponry of this war.

Re: El Salvador makes Bitcoin legal tender

#376

Post by el-salvador »

rebuilder wrote: post #365
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.

Is there some writeup with details on how El Salvador will implement things? One obvious option would seem to be a wholly custodial, national, off-chain payment system. So El Salvador would hold BTC reserves, while people would actually transact on a government-operated ledger, only interacting with the Blockhain when withdrawing or receiving actual BTC outside the system, if that will be allowed.

Not yet.

The most detailed explanation was given by the president and his brother on a twitter space in English this midnight.

Re: El Salvador makes Bitcoin legal tender

#377

Post by ddvvff »

pavlov wrote: post #178
nemo1618 wrote: post #114

Regardless of your feelings about Bitcoin, it was really exciting to see the president of El Salvador himself pop into a Twitter Space last night, as the bill was being voted on , to chat with bitcoiners about the implications of the new law. This is exactly the appeal of Twitter, if you think about it: it's a kind of "direct democracy" where the leader of a country can chat casually with everyday people -- and not i…

This president of El Salvador sent soldiers into the Legislative Assembly to coerce the parliament to vote in his favor: https://en.wikipedia.org/wiki/2020_Salvadoran_political_cris... He is not a friend of democracy, except the performative "chatting with laser-eyed crypto stans on Twitter" kind.

Sorry if this is not on your sensibilities, but that assembly was very corrupt so much so that people wanted them out as soon as possible, he did not command the military to do what they did, the military showed up in support for the people who were also there.

He has 90% approval rate on the opposition owned polls, and he has supermajority of the assembly for a reason, 30 years of pure corruption without any consequences by the previous governments, you'll not find enough people to oppose him to fill a boulevard.

The new assembly just passed a bill finally allowing Salvadorans in other countries to vote in all future elections, if that's not democracy I don't know what is, if the opposition is against the overwhelming support he has, maybe they should've done things right by the people in those 30 years, but they didn't and they're finally out.

And it was done democratically, by the people without a single protest.

Read into what the traditional parties did to try to block Bukele for running for president, they closed a political party overnight with a congressman from that party still in the assembly, which was unconstitutional, but nobody said a word there.

Re: El Salvador makes Bitcoin legal tender

#378

Post by 627467 »

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…

El Salvador doesn't need to establish mining operation to leverage this new legal tender, anymore than Ecuador (or others) have to print USD for their own economies. countries that use large quantities of dollars do need to regularly import/export USD notes though

Re: El Salvador makes Bitcoin legal tender

#379

Post by acdha »

pinkybanana wrote: post #140
acdha wrote: post #107

Earlier quoted context omitted.

> But the importance is that there is always the option to self-custody if you want to. With fiat you don't have that option even in theory. You mean that if you store cash it will magically disappear once you hit a certain quantity or age?

Physical cash is ridiculously cumbersome and difficult to handle in larger quantities. I wouldn't probably be able to get $10k worth of cash from my local bank, and getting something like $100k would probably require days and lots of work. However if I have millions worth of BTC at some big exchange, I can move that amount to a secure self custody in 10 minutes without a hassle.

So you agree that you were wrong to say that you don’t have the option even in theory? Convenience is a discussion point but it’s predicated on being possible – and since this happens not-infrequently (people buy cars, farm equipment, even houses with cash) it’s far from theoretical.

One other area to learn about: security – while it’s true that you can move millions on yourself own, the risks of theft or accidental loss are why most people do not avail themselves of these theoretical options since they consider the cost of banking fees to be an acceptable trade off for the security and convenience of letting a professional handle those problems.

Re: El Salvador makes Bitcoin legal tender

#380

Post by SavantIdiot »

ddtaylor wrote: post #251
rawtxapp wrote: post #191

Earlier quoted context omitted.

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.

So "off chain" means LN holds the BTC in some other data structure then batches it up as one big transaction? Kinda like how a broker covers small retail trades until they hit enough volume to register an NYSE trade on the floor? Is that how it works? If so , this means lots of BTC is tied up in LN ... that seems dubious as heck.
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