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That's heavy editorializing: El Salvador keeps buying the Bitcoin for its strategic reserve. Businesses and citizens can keep using it. But for getting an IMF loan, IMF (which, to put it mildly, doesn't like Bitcoin) required the end to Bitcoin legal tender status. Now the businesses are free to accept it or not instead of being required to accept it. That's all. The government plans to keep buying and using it.
Earlier quoted context omitted.
“Another change makes using bitcoin entirely voluntary. (Previously, the law mandated that businesses accept bitcoin for any goods or services they provided.) Additionally, bitcoin can no longer be used to pay taxes or settle government debts.” -- https://reason.com/2025/02/03/el-salvador-walks-back-its-bit... Sounds pretty failed to me.
They did this to receive a loan from the IMF. The IMF was withholding the loan because of BTC and would not disburse it until they got rid of its status as legal tender.
Presumably they require their loan to be repaid in fiat because of their internal charter. If Bitcoin adoption eventually removes El Salvador's ability to issue fiat, their loan can't be repaid.
Here is the retained purchasing power of each of the coins since the law was passed in September 2021: Legal tender 1: -15% Legal tender 2: +115% Guess which one has been deemed a "Failed experiment".
Do you see the absurdity?
Nobody wants to spend it anyway, just hoard or sell it to the next sucker willing to shell more $. Among all the crypto shills I know I'm probably the only one who has used it for trade (0.25ish Bitcoins for a computer on caseking.de in late 2017 and few goodies on local bitcoin in the same year).
Mostly because transferring BTC is very expensive. Every time I’ve done it I’m shocked at the fees that sites like Bitbuy requires. So if you’re going to do it then it has to be for a good reason.
That's heavy editorializing: El Salvador keeps buying the Bitcoin for its strategic reserve. Businesses and citizens can keep using it. But for getting an IMF loan, IMF (which, to put it mildly, doesn't like Bitcoin) required the end to Bitcoin legal tender status. Now the businesses are free to accept it or not instead of being required to accept it. That's all. The government plans to keep buying and using it.
Bitcoin tried for 15-20 years to find a use case but now it’s just an asset class like gold and nothing else, it will never be more than that.
Earlier quoted context omitted.
Mostly because transferring BTC is very expensive. Every time I’ve done it I’m shocked at the fees that sites like Bitbuy requires. So if you’re going to do it then it has to be for a good reason.
This is fascinating to me because we were told 15 years ago (ish) that one of the main things that made crypto special (besides it being guaranteed finite unlike fiat) was that unlike say, Visa, it would be economic to use, even for small transactions, because The Big Banks wouldn't take their ~3% cut of every transaction. We all assumed that cut was determined by greed, but if Bitcoin is expensive to transact in now…
Earlier quoted context omitted.
They did this to receive a loan from the IMF. The IMF was withholding the loan because of BTC and would not disburse it until they got rid of its status as legal tender.
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not taking loans from them…
The IMF (or its donor nations) aren’t forcing anyone to take loans from them. Countries do that because the IMF offers much cheaper rates they can get anywhere else and is willing to forgive those loans far more easily than any other entity.
In return it expects certain good governance changes that are stated upfront as conditions to receive the loans you could very well get from anywhere else in the world.
Don’t like what they consider good governance? Don’t take a loan from them. Go get in the private market or the variety of nations willing to lend at far more onerous terms.
That's heavy editorializing: El Salvador keeps buying the Bitcoin for its strategic reserve. Businesses and citizens can keep using it. But for getting an IMF loan, IMF (which, to put it mildly, doesn't like Bitcoin) required the end to Bitcoin legal tender status. Now the businesses are free to accept it or not instead of being required to accept it. That's all. The government plans to keep buying and using it.
So I wouldn't call it a "failed experiment" per se - more like a publicity stunt that has achieved publicity.