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El Salvador abandons Bitcoin as legal tender

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Re: El Salvador abandons Bitcoin as legal tender

#381

Post by csomar »

FireBeyond wrote: post #368
sporkydistance wrote: post #336

Earlier quoted context omitted.

Here's one good use: I looked into leaving the US to become a citizen elsewhere. I have about $15MM in my retirement. I would have to pay a penalty on my taxes for early withdrawal, and be taxed when I renounce my citizenship. In theory I could cash everything out, buy a huge amount of BTC, move to another country (within a week, or quickly!!), and then cash it out in their currency. Of course, all sorts of alarm bel…

So your one good use is... tax evasion. Huh. It's not illegal to move money out of your investment accounts, it's just reported so that yes, you can have a tax liability. I too, would like tax-free investments and funds.

One man tax evasion is another man escape from illegitimate capture.

Re: El Salvador abandons Bitcoin as legal tender

#382

Post by chii »

chowchowchow wrote: post #340
liontwist wrote: post #291

Earlier quoted context omitted.

I come to these threads expecting criticism about bitcoin being funny internet money run by a small group of shady characters. But most of the comments are about how stable currency and stores of wealth are actually bad! It kind of sounds like we think bitcoin is working. If USD is inflating and Gold is staying still, is gold “deflating”?

What do you call someone who bought a pizza with BTC last year? Paper hands? Shouldn’t they have hodled and not had pizza? How can this be a currency.

> Shouldn’t they have hodled and not had pizza?

but then starved to death while hodling?

Re: El Salvador abandons Bitcoin as legal tender

#383

Post by dhosek »

Structurally, Bitcoin is a lousy idea for a currency as it is intrinsically deflationary (i.e., even without the speculative inflating of the cost of a Bitcoin, the structure of the coin is such that coins become increasingly scarce and expensive as time goes by). You do not want this in your currency. The ideal is a low-level of inflation which provides an incentive to spend sooner rather than later. With a deflationary currency, the incentive is to put off purchases as long as possible as your currency will buy more tomorrow than it does today. Deflation ends up being economically disastrous, as Japan’s battles with deflation over most of the twenty-first century have shown.

This is why, aside from speculation, purchase of illicit goods and ransom payments, Bitcoin has had little traction as a currency.

Re: El Salvador abandons Bitcoin as legal tender

#385

Post by TeaBrain »

shash wrote: post #357
GamerUncle wrote: post #330

Earlier quoted context omitted.

>The other punchline to the Gold joke is that it's finite. In 120 years it will begin to evaporate from existence as more and more gold chests are simply lost to time. This is how insane that sounds

That's because it's actually quite sane; relying on commodity backed currencies - especially those which are _finite_ leads to deflation. You see that with BTC, where the value keeps rising and you need more and more fractional denominations to make sense. With gold (and historically, more so silver), it was _very rarely_ used for actual trade because it ended up being like five gold coins == someone's entire life sa…

>Debased currency - a problem every large state eventually faced - is a consequence of deflation

Inflation in the monetary supply, not deflation, leads to the debasement of a currency. An example is how the influx of gold from the conquistadors into 16th century Spain led to inflation, due to the increased supply of this means of exchange resulting in the debasement in value of a given unit of this means of exchange.

Edit: I'd remembered wrong. It was silver, not gold, that Spain experienced an influx of.

Re: El Salvador abandons Bitcoin as legal tender

#386

Post by elevaet »

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…

It also needs to scale well, which bitcoin doesn't. This is evidenced by the ever increasing energy demand, slow transaction times and high fees.

Re: El Salvador abandons Bitcoin as legal tender

#387

Post by listenallyall »

freedomben wrote: post #294
Kindra wrote: post #268

Earlier quoted context omitted.

Are you able to point to a single case where Bitcoin was used as legal tender in an every day business transaction? By this I mean, can you give an example where someone ordered a cup of coffee with Bitcoin directly and not through a proxy?

I used to pay my dish network bill with it before they stopped accepting it. I've also used it to send money to friends and family, and to donate to open source projects and other things. If the fees were lower I'd use it for plenty of other things too.

> If the fees were lower

Aye, there's the rub.

With all due respect, why not Bitcoin Cash or some other coin? Bitcoin Cash is the exact same thing as Bitcoin - same protocol, same 21 million coin limit, same Satoshi whitepaper, same everything, except bigger blocks and thus, much lower fees. If you are using a coin as an actual currency, and not as a speculator, why stick with high-fee Bitcoin?

Re: El Salvador abandons Bitcoin as legal tender

#388

Post by girvo »

Gud wrote: post #374
karlgkk wrote: post #247

Earlier quoted context omitted.

It’s being “used” as a speculative asset. That’s not a firm foundation to run a governmental monetary system on. Maybe there are other cryptocurrencies better suited to the task, but BTC isn’t

Don’t forget buying drugs online! Which is mostly what I use it for…

Well, for buying Monero to buy drugs online right?

Re: El Salvador abandons Bitcoin as legal tender

#389

Post by [deleted] »

roenxi wrote: post #378
stephen_g wrote: post #200

Earlier quoted context omitted.

Despite that interference, from everything I’ve read though it’s hard to describe the bitcoin experiment as anything else than a massive failure…

If I could convince someone to give me 1.x billion to change my behaviour, I would consider that behaviour a massive success without much further thought. It isn't a huge amount of money at the scale of a national economy but >$1 billion for nothing is a win. Although of course it is unknowable how much of that money was bribe and how much El Salvador would have gotten without additional leverage.

[deleted]

Re: El Salvador abandons Bitcoin as legal tender

#390

Post by heurist »

nadermx wrote: post #153
LAMike wrote: post #125

Earlier quoted context omitted.

It is more rare than gold and getting more rare every 4 years. What is the current supply of gold and what will it be in 2050?

Gold has a utility, used in a large swath of electronics. Can always be sold to make something. Bitcoin can only be sold if there is a fiat currency trading in it

Bitcoin's utility is that you can both hold it in your hands and send it across the world in 10 minutes with no intermediaries. Can't do that with gold.
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