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El Salvador abandons Bitcoin as legal tender

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Re: El Salvador abandons Bitcoin as legal tender

#171

Post by odo1242 »

ggm wrote: post #4

Speculative asset class fails as non-speculative legal tender class. If king for the day with a sovereign wealth fund I wouldn't forbid investment choices like this on risk grounds, I mean you need risk assets as well as boring ones, right? But I have problems with the moral quality: it's like state investing in the casino business. Monaco? works fine. Anywhere else? It's got problems. Like a lot of people, I probabl…

It might have worked if El Salvador made their own cryptocurrency which they control and could mint more of and backed it properly as a non-speculative legal tender, but they didn’t and that didn’t happen.

Re: El Salvador abandons Bitcoin as legal tender

#172

Post by Analemma_ »

desumeku wrote: post #36
cwillu wrote: post #31

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.

If the Bitcoin experiment had been a success, they wouldn't be needing an IMF loan.

Re: El Salvador abandons Bitcoin as legal tender

#173

Post by roenxi »

codethief wrote: post #152
ggm wrote: post #4

Speculative asset class fails as non-speculative legal tender class. If king for the day with a sovereign wealth fund I wouldn't forbid investment choices like this on risk grounds, I mean you need risk assets as well as boring ones, right? But I have problems with the moral quality: it's like state investing in the casino business. Monaco? works fine. Anywhere else? It's got problems. Like a lot of people, I probabl…

> Speculative asset class fails as non-speculative legal tender class. This. Bitcoin proponents often claim that eventually everyone will use Bitcoin for payments ("Finally no more governments or central banks!") and that's why it will increase in value, so everyone should invest in BTC. But this argument is fundamentally flawed: A currency, in order for it to work (in order for people to be able to trust it), needs…

In fairness, markets can operate quite well with almost nobody in them being able to argue why. Gold has remarkable staying power but it is rare to find gold proponents who can explain why convincingly. A lot of the arguments for where the value comes from are bunk. If I hear one more person explaining that jewellery matters I'll ... go peacefully about my day I suppose.

Still holds its value though, the economy does not care if people understand why the price signals are so.

Re: El Salvador abandons Bitcoin as legal tender

#174

Post by iforgot22 »

Mengkudulangsat wrote: post #2

> The government, she assured, will continue buying bitcoin and having reserves in this cryptocurrency Sounds like the term "Failed Experiment" is the writer's assertion and not the government official position.

Better article: https://www.reuters.com/world/americas/lawmakers-el-salvador...

Re: El Salvador abandons Bitcoin as legal tender

#175

Post by pcthrowaway »

starspangled wrote: post #156
threeseed wrote: post #102

Earlier quoted context omitted.

> nice to see how progressive and creative El Salvador has been Alright so let's have a look at these progressive/creative approaches: https://en.wikipedia.org/wiki/Crime_in_El_Salvador (a) Mass arrests of anyone who merely had a gang tattoo, (b) Jailing of children, (c) Security cameras everywhere, (d) Inhumane treatment of prisoners. Trashing human rights is always effective but hardly creative nor progressive.

Human rights of victims of these criminals were being routinely trashed and ignored before Bukele's reforms, so that's just not a trump card. His progressive reforms have significantly improved society for the greater good and has stood up for human rights that were being trampled, it is also against the conservative status quo thinking of how to deal with crime, so it very much fits the dictionary definition of prog…

> it is also against the conservative status quo thinking of how to deal with crime

How are tough on crime policies "against the conservative status quo"?

Re: El Salvador abandons Bitcoin as legal tender

#176

Post by whimsicalism »

verdverm wrote: post #167
desumeku wrote: post #57

Earlier quoted context omitted.

Those issues are not really relevant when it comes to factors like transaction speeds and the diversity of assets available to transact with, such as stablecoins, as well as DeFi platforms to actually use those assets on.

When most people hear daily usage, they think groceries, bills and paycheck, not day trading on an exchange, defi or centralized. In this regard, crypto currency is not really a currency that people can use for their daily lives without worry and risk from volatility

yes it is, just use stables. frankly it is a much more convenient way to move money if the other person has it as well

e: and i’m no crypto obsessive really, i don’t think it was usable even 3 years ago but it’s pretty handy now, can easily send $20 in usdc on base or use it to purchase carbon offsets or use it on election/sports betting or use it to purchase deepseek r1 credits…

Re: El Salvador abandons Bitcoin as legal tender

#177

Post by carlosjobim »

threeseed wrote: post #102
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…

> nice to see how progressive and creative El Salvador has been Alright so let's have a look at these progressive/creative approaches: https://en.wikipedia.org/wiki/Crime_in_El_Salvador (a) Mass arrests of anyone who merely had a gang tattoo, (b) Jailing of children, (c) Security cameras everywhere, (d) Inhumane treatment of prisoners. Trashing human rights is always effective but hardly creative nor progressive.

What would you say to the victims of these gangs?

Re: El Salvador abandons Bitcoin as legal tender

#178

Post by ty6853 »

andreareina wrote: post #159
ggm wrote: post #91

Earlier quoted context omitted.

It hasn't entirely stopped rents in HK being untenably high, for many people. It has rent controls, but the system permits some very untenable outcomes which if left unchecked would re-create Kowloon Walled City. So whilst politically I agree, practically I am unsure there is no land speculation: A waterfront view remains valuable in and of itself, no matter what.

Or in Singapore

Singapore relies on the fact like 20 or 30% of their tax paying population is ineligible for public housing due to not being a PR nor citizen.

Re: El Salvador abandons Bitcoin as legal tender

#179

Post by iforgot22 »

mattnewton wrote: post #151
Mengkudulangsat wrote: post #96

Earlier quoted context omitted.

Hmm.. I didn't know that. Which makes the demand purely political then. I recall IMF making the same demand from an island country a few years ago too. https://www.imf.org/en/Blogs/Articles/2021/07/26/blog-crypto...

The IMF feels bitcoin is a risky asset and doesn’t want to be a part of that gamble when making its loan. The IMF has a history of making lots of conditions they feel minimize risk. To me it looks more like my bank mandating I carry certain kinds of insurance in the terms of my mortgage than a political bias, but I am not an expert.

"urged officials to limit its exposure" is what the Reuters article said, so yeah. They think El Salvador's ability to repay the loan is tied too much to BTC.

Re: El Salvador abandons Bitcoin as legal tender

#180

Post by fny »

odo1242 wrote: post #171
ggm wrote: post #4

Speculative asset class fails as non-speculative legal tender class. If king for the day with a sovereign wealth fund I wouldn't forbid investment choices like this on risk grounds, I mean you need risk assets as well as boring ones, right? But I have problems with the moral quality: it's like state investing in the casino business. Monaco? works fine. Anywhere else? It's got problems. Like a lot of people, I probabl…

It might have worked if El Salvador made their own cryptocurrency which they control and could mint more of and backed it properly as a non-speculative legal tender, but they didn’t and that didn’t happen.

So... fiat?
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