Bitcoin becomes Legal Tender in El Salvador

Post by koheripbal » Wed, Jun 09, 2021, 12:19 PM UTC

JumpCrisscross wrote: post #78

FreeTrade wrote: post #18

Sigh. Bitcoin BTC, at 3 transactions per second, doesn't have the capacity to support El Salvador's economy. Even if Lightning worked (it doesn't), BTC doesn't have enough capacity to open channels for users at a reasonable cost. Salvadorians will end up forced to use proprietary payment networks denominated in BTC. BTC is not cash anymore, it won't work as such. There are other cryptos that could work, we'll have to…

> doesn't have the capacity to support El Salvador's economy It's easier for San Salvador to disappear Bitcoin into cronies' pockets than U.S. dollars. For this purpose, Bitcoin's deeper liquidity makes it the best choice. Less cynically, Bitcoin has brand recognition. That makes it politically palatable in a unique way. Bitcoin isn't a great currency. But it is a competitive store of value. El Salvador doesn't have…

Post by gjulianm » Wed, Jun 09, 2021, 12:25 PM UTC

wereHamster wrote: post #39

gjulianm wrote: post #33

Earlier quoted context omitted.

But then why use Bitcoin if you're going to use what is essentially a bank?

Ease of access to and exchange with global marketplaces. I can transfer/trade directly from/to El Salvador without any bank being involved in that transaction.

Post by stiltzkin » Wed, Jun 09, 2021, 1:25 PM UTC

koheripbal wrote: post #131

JumpCrisscross wrote: post #78

Earlier quoted context omitted.

> doesn't have the capacity to support El Salvador's economy It's easier for San Salvador to disappear Bitcoin into cronies' pockets than U.S. dollars. For this purpose, Bitcoin's deeper liquidity makes it the best choice. Less cynically, Bitcoin has brand recognition. That makes it politically palatable in a unique way. Bitcoin isn't a great currency. But it is a competitive store of value. El Salvador doesn't have…

bingo. Crypto is a boon for crime and rogue states.

Post by sktrdie » Wed, Jun 09, 2021, 2:33 PM UTC

pointsphere wrote: post #127

Semaphor wrote: post #51

Earlier quoted context omitted.

> Even if Lightning worked (it doesn't) What doesn’t work? I’ve only skimmed some LN search results, and it looks like there are a bunch of services using it, including strike [0] which was mentioned in a comment of the big thread here [1]. This would have the same problem (proprietary network) you mentioned, but it seems to be working still? [0]: https://strike.me/ [1]: https://news.ycombinator.com/item?id=27408978

To fund a Lightning channel you have to pay fees on the Bitcoin network, which can get quite high. Up to 50 USD during times of high demand. To send to someone who's offline the recipient either has to run their own always-on node, or use a custodial service. Routing small payments (one of the goals of Lightning) is unreliable with a high chance of failure. See http://essay.utwente.nl/82015/1/Satcs_BA_EEMCS.pdf

Post by koheripbal » Wed, Jun 09, 2021, 4:39 PM UTC

yaa_minu wrote: post #134

koheripbal wrote: post #128

Earlier quoted context omitted.

The other issues with channels is that only the entry and exit transactions are validated - every transaction in the channel is not secured by any network. Meaning you can open a channel, but if you want to sell real-world goods in exchange for anything that happens in that channel, then you'd better trust the other parties in the channel to close it properly. tldr; Lightning is indeed super fast, but it's not as sec…

This is not true. Lightening network is trustless just like the bitcoin base layer unless for very very small transactions (like few cents). Channels are constructed in such a way that any counterparty that attempts to cheat can be punished by the honest partner. Of course the honest partner has to be actively monitoring the base bitcoin network but this can also be outsourced to a third-party (tehcnically called a w…