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El Salvador abandons Bitcoin as legal tender

ticotimes.net

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Re: El Salvador abandons Bitcoin as legal tender

#141

Post by bawolff »

xp84 wrote: post #43
dmix wrote: post #21

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…

Transaction fees are because bitcoin is an inherently inefficient system.

Don't get me wrong, satoshi is a genius, but there are severe tradeoffs required to get the properties bitcoin wants.

Re: El Salvador abandons Bitcoin as legal tender

#142

Post by epolanski »

BobbyTables2 wrote: post #107
xp84 wrote: post #43

Earlier quoted context omitted.

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…

The cut was determined by greed. Technically cryptocurrencies were meant to be held and exchanged directly, without an exchange. Of course that isn’t convenient for non-enthusiasts… How fortunate we are that crypto exchanges, run by private companies with little government regulation, operate out of the goodness of their heart /s…

Transaction fees have nothing to do with crypto exchanges (which would probably love them to be lower).

Re: El Salvador abandons Bitcoin as legal tender

#143

Post by archagon »

starspangled wrote: post #130
EA-3167 wrote: post #86

Earlier quoted context omitted.

This is... a strange and jarring thing to read. My kneejerk response was that yes, they are innovating and experimenting with oppressive and corrupt governance, but that is ultimately uncharitable. A more balanced response is that while you may personally think of Bitcoin as progressive (I can't imagine why) you certainly can't claim that Bukele's El Salvador is progressive. You may like the gang crackdown, you may a…

I don't think "bitcoin" is progressive, bitcoin is a technology. I think the idea of trying a decentralized electronic currency is progressive. Whether they implemented it well or should have seen the problems with using it as a currency is one thing, but in the idea of trying something new sure I think it was good. I don't think it caused grave harm to try. And I certainly can claim that their policies on crime are…

That’s all well and good until innocent people get caught in the net. How many thousands of young people are worth incarcerating indefinitely and without legal recourse for the benefit of society at large? Would you throw your own child into the pit if it meant that the happiness and safety of your town was ensured? In the extreme, why not just make every crime carry a death penalty? Would that society be perfect by your measure?

(And that’s before we start dissecting the bribery and corruption of those who wield this power.)

Re: El Salvador abandons Bitcoin as legal tender

#144

Post by starspangled »

BryantD wrote: post #80
starspangled wrote: post #73

It's interesting and nice to see how progressive and creative El Salvador has been. Some failures are perfectly understandable when one is willing to try new things. Their approach to crime is another thing that comes to mind that was lambasted and ridiculed by the "international community" and "experts". Yet in the space of a single decade they went from murder capital of the world to safer than New Zealand (in term…

Note that their official homicide numbers no longer include bodies found in unmarked graves (as of 2021), people killed in conflicts between police and gangs (as of 2022), and people killed in prison. These are arguably reasonable decisions but unless you backfit the old numbers, you don't have the real trend. I suspect that the trend would be impressive either way, you'd just lose the "safer than New Zealand" line.

Well there's no need to suspect, homicide rates were dropping like a rock before 2021. Perhaps faster than has been achieved by any other social reform on record.

Re: El Salvador abandons Bitcoin as legal tender

#145

Post by bawolff »

josu wrote: post #81
sporkydistance wrote: post #64

Earlier quoted context omitted.

If legal tender #2 went up 115% in 4 years I would feel like a jackass for spending it in 2021 because I would have doubled my money if I saved it. Do you see the absurdity?

Inflationary legal tender is a novel concept.

So novel... remind me again what happened to spain in the 16th century?

Re: El Salvador abandons Bitcoin as legal tender

#146

Post by wmf »

abdullahkhalids wrote: post #20

In the 15 years since Bitcoin went viral, has someone proposed a reasonable social, legal and financial protocol for how a society can adopt a novel cryptocurrency without getting stuck in the phase where the cryptocurrency becomes a speculative asset rather than a common medium of exchange? By novel, I mean not using an existing cryptocurrency that is already stuck in the speculative asset phase. Surely, if a govern…

Stablecoins/CBDCs aren't speculative.

Re: El Salvador abandons Bitcoin as legal tender

#147

Post by cg5280 »

sahila wrote: post #118
sporkydistance wrote: post #58

Earlier quoted context omitted.

Why would anyone spend a single BTC/sat. if they know it could be worth 10x more in a few weeks/years?

Because if you/they knew that, then they'd be buying more bitcoin. On a much smaller scale, your dollar goes up by 5% every year but you still use it everyday because all your monies are in dollars. If all your monies are in btc, you'd have to sell to buy things.

If you suppose that BTC would be a widely adopted currency, you wouldn't "sell" it, you would simply exchange it for the good or service. But in this case if BTC is deflationary you would still hesitate to spend it. USD is inflationary, so there is hypothetically a small pressure to use it.

Re: El Salvador abandons Bitcoin as legal tender

#148

Post by nyokodo »

slashdev wrote: post #117
breadwinner wrote: post #103

Earlier quoted context omitted.

Speaking of Sovereign Wealth Funds... Trump Calls for Wealth Fund in Executive Order https://www.nytimes.com/2025/02/03/us/politics/sovereign-wea...

Wouldn’t they need to balance a budget first? Not in my lifetime

> Not in my lifetime

Were you alive in the mid to late 90s? A string of balanced budgets and surpluses. There are new problems and no dot com bubble right now but most Americans were alive the last time we had balanced budgets. It is quite possible.

Re: El Salvador abandons Bitcoin as legal tender

#149

Post by starspangled »

archagon wrote: post #143
starspangled wrote: post #130

Earlier quoted context omitted.

I don't think "bitcoin" is progressive, bitcoin is a technology. I think the idea of trying a decentralized electronic currency is progressive. Whether they implemented it well or should have seen the problems with using it as a currency is one thing, but in the idea of trying something new sure I think it was good. I don't think it caused grave harm to try. And I certainly can claim that their policies on crime are…

That’s all well and good until innocent people get caught in the net. How many thousands of young people are worth incarcerating indefinitely and without legal recourse for the benefit of society at large? Would you throw your own child into the pit if it meant that the happiness and safety of your town was ensured? In the extreme, why not just make every crime carry a death penalty? Would that society be perfect by…

> That’s all well and good until innocent people get caught in the net.

Is your position that no innocent people were convicted of crimes before the reforms, or that innocent people do not get caught in the crimes that have been reduced so dramatically?

> How many thousands of young people are worth incarcerating indefinitely and without legal recourse for the benefit of society?

And how many young people are not killed or maimed or dragged into a life of crime indefinitely and without recourse in the alternative?

As I said, I acknowledge the issues with it, but no social policy is perfect and all social policy is a balance. You can't pull out "human rights" as a trump card to say Bukele's policies are bad or worse than before. Because you are confining and defining human rights in a very narrow specific way, and that does not account for many other rights of many other classes of people.

Re: El Salvador abandons Bitcoin as legal tender

#150

Post by throwaway314155 »

bawolff wrote: post #116
Mengkudulangsat wrote: post #63

Earlier quoted context omitted.

Fair demand by the IMF. 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.

That's not really how that works. IMF can demand their loan be repaid in whatever currency they want. Its totally normal for international loans to be denominated in a currency other than the recipient's legal tender, particularly for high risk countries (although that is usually bad for the recipient)

They don't want Bitcoin in exchange. Seems entirely reasonable to me given how much the value of cryptocurrency fluctuates with low predictability. They could get paid in it one day and lose half the value the next.
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