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One year on, El Salvador’s Bitcoin experiment has proven a failure

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Re: One year on, El Salvador’s Bitcoin experiment has proven a failure

#211

Post by pessimizer »

donatj wrote: post #183
pessimizer wrote: post #93

Earlier quoted context omitted.

If 8% inflation has put you paycheck to paycheck, living "very comfortably" was already living far beyond your means.

The 8% figure doesn’t match real life. My electric bill doubled, my natural gas bill doubled, my municipal bill doubled, my groceries doubled.Everything that makes up the vast majority of my expenditures had doubled.

You could be the guy where it's only raining above his house, but the people you are having this conversation with also live in the world and disagree with your figures as much as the statistics do.

Re: One year on, El Salvador’s Bitcoin experiment has proven a failure

#212

Post by Bud »

donatj wrote: post #178
UncleMeat wrote: post #73

Earlier quoted context omitted.

I cannot think of a single individual item that I buy at the grocery store that has doubled, let alone more than doubled.

Cereal and butter. A box of cereal is $7+ now, whereas it was $4 not long ago. A pack of butter was $2.50 and now close to $5.

Butter actually wasn't $2.50 at any point in the recent past. This is easy to track.

https://fred.stlouisfed.org/series/APU0000FS1101

So of the two items you cherry-picked to support an assertion that groceries have more than doubled, one is up...around 30-35%. In fact, there doesn't appear to be a single food item in this list that has doubled in the past year. Eggs are the closest.

https://www.bls.gov/regions/mid-atlantic/data/averageretailf...

Re: One year on, El Salvador’s Bitcoin experiment has proven a failure

#213

Post by pessimizer »

UncleMeat wrote: post #174
yamtaddle wrote: post #124

Earlier quoted context omitted.

IIRC the giant flats of Costco eggs went up to 3-4x their former price over the last year or so. Still a great deal, they're just not "holy shit that's practically free!" like before.

Weird. Eggs by the dozen (along with onions, one of the most volatile staples at the grocery store) are up only like 75% for me. Admittedly that's a lot and more than I had expected when I went and checked but I'm still seeing very different numbers.

Another datapoint: eggs are up 3-4x for me in Chicago.

Re: One year on, El Salvador’s Bitcoin experiment has proven a failure

#214

Post by phreack »

redox99 wrote: post #193
Spellman wrote: post #162

Earlier quoted context omitted.

Not really. Argentina is explicitly all about using crypto to get access to US Dollars. And they're all going through intermediaries, some who don't even control their own wallets and are just using available crypto exchanges. So that's a lot of 3rd parties, just not the Argentinian government. https://www.freethink.com/technology/crypto-argentina-black-...

> Argentina is explicitly all about using crypto to get access to US Dollars. Kind of. It is very complex and I could write an essay, but to put it short, if you receive let's say a SWIFT transfer in USD, EUR, whatever, it will be forcibly converted to ARS (local currency) at an unfair rate: if you tried to buy back USD with the ARS you received, you could only get half of the original amount. It's almost like a 50%…

Not daily, but since crypto (mostly stables) is a much safer value storage than the local currency, I've seen plenty of people selling say USDT for ARS once or twice a month and living off of that. In major cities you can likely find someone willing to buy in every neighborhood.

The fiscal aspect of it is just magical though. Everyone and their cousin either becomes an expert in tax law, or blatantly and unknowingly breaks it every day with no major consequences. So many, many, many people live outside the law that enforcing it equally would mean instant violent riots and protests.

Re: One year on, El Salvador’s Bitcoin experiment has proven a failure

#215

Post by nightski »

dragontamer wrote: post #180
donatj wrote: post #176

Earlier quoted context omitted.

USD is not up . Everything is down. Have you been to a store recently?

USD is hugely up vs Yen and Euro. You buy anything from overseas recently? USD is hugely strong. USD is up vs the stock market, vs the bond market, vs the overseas bond market, vs overseas stocks. USD is also up vs Bitcoin. EDIT: Feel free to look at gold, silver, and other 'inflation hedges' while you're at it. The main thing going up is commodities (oil and food), which is certainly important. But there's more to t…

Inflation is basically the exact definition of the change in USD's value relative to goods & services.

Unless you are arguing we currently don't have any inflation, which would be a tough sell :)

Also this last CPI report oil & gas pulled inflation down whereas just about everything else pulled it up. Food is hot, but a lot of other things are as well including non-commodity service based industries.

Re: One year on, El Salvador’s Bitcoin experiment has proven a failure

#216

Post by JeremyNT »

jl6 wrote: post #123
theplumber wrote: post #47

Earlier quoted context omitted.

>> but that Bitcoin would replace all currencies (as early advocates would have had you believe) was not one of those reasons. Bitcoin was not bought because people believed it will replace all currencies. They bought bitcoin to get rich fast and cash out BEFORE the expected crash.

A lot of the early enthusiasm absolutely was from cypherpunk futurists who genuinely did want/expect it to make traditional finance obsolete.

This is pretty amusing to me, as somebody who did buy into the early hype - now over a decade ago. I actually got really excited about bitcoin, even mining way back when. It seemed like the possibilities were endless!

That excitement disappeared pretty quickly once I came to the (in hindsight, obvious) realization that its only valid use cases were illicit transactions and speculation. I donated whatever I had and moved well away from it (certainly a poor financial decision in retrospect, but I still believe it was the right choice personally).

The shine has been off BTC for a long time. Even though some (if not most) of the early adopters were as you describe, I suspect that almost all of the more recent comers have only joined the party for the get rich quick scheme.

Re: One year on, El Salvador’s Bitcoin experiment has proven a failure

#217

Post by darth_aardvark »

koonsolo wrote: post #189
SketchySeaBeast wrote: post #160

Earlier quoted context omitted.

If we think like this why wouldn't I invest 1% of my portfolio in lottery tickets? At worst lose 1%, at best x1,000,000 upside?

The reward/risk ratio of lottery tickets is very well known. And it's obviously not in your favor. So it's basically a no brainer not to invest in them. Things like startups for example also have a very high risk rate, but also potential high payouts. There it actually makes sense since the ratio is way better.

So don't invest it in that lottery. Invest it in my lottery! I'll sell you as many tickets as you want, I pay out a trillion to one if you win, and I'll keep the risk rate totally unknown to you.

Re: One year on, El Salvador’s Bitcoin experiment has proven a failure

#218

Post by [deleted] »

SketchySeaBeast wrote: post #169
dragontamer wrote: post #142

Earlier quoted context omitted.

When people are complaining about the declining purchasing power of USD, they are mostly talking about since November 2021, because that's when inflation started to really kick in. Its ironically, also when BTC really began to collapse from its $60,000 high. So it really demonstrates how much the BTC was benefiting from low-interest rate / inflationary policies.

> So it really demonstrates how much the BTC was benefiting from low-interest rate / inflationary policies. It's almost like it's not a hedge at all and just another part of the exact same game as the rest of the market.

[deleted]

Re: One year on, El Salvador’s Bitcoin experiment has proven a failure

#219

Post by bastawhiz »

simple-thoughts wrote: post #36

Prediction: El Salvador will look genius in the next Bitcoin cycle. Other emerging market central banks will proceed to copy their model creating the next cycle’s peak. Once they stop buying, the market will crash again creating either a global depression or a bailout of the btc economy by USG, causing a repeat of the bank bailout that spawned btc in the first place.

If El Salvador looks like a genius and their poorest citizens come around and get on board, the next crash will cause a humanitarian crisis: the poorest of the world will literally have given money to the rich who were able to get out of the market fast enough.

Re: One year on, El Salvador’s Bitcoin experiment has proven a failure

#220

Post by tinco »

lake_vincent wrote: post #191
Yizahi wrote: post #141

Earlier quoted context omitted.

Could you please describe in your own words how an asset can be "crypto backed", and exactly what operations/interactions are improved by this?

I mean, it is not that hard to imagine, right? A car title becomes an NFT. Whoever owns the NFT owns the car. Same with a house. Or a horse. I'm not a crypto expert, but that is a relatively trivial use case for NFTs. As for how this scales? I have no idea. I'm just speculating that it's gonna happen somehow . I mean, hell, look at this post - a nation adopted Bitcoin. You think that's the last time a government will…

Well, no crypto expert ever predicted this. The idea of NFT's has pretty much been discounted by everyone in the crypto community for a decade, until they randomly became a fad in 2021. So I wouldn't say it's very easy to imagine.

Smart contracts backing more real world assets has a slightly higher chance of becoming a thing, but even with those the value isn't super clear. The whole idea of tracking ownership is that it's backed by authority to enforce it, and the whole idea of cryptocurrency is that it works without authority.

If you think NFT you think about that vague thing that has no bearing on the real world. Bitcoin is the magic technology that manages to be scarce and be manifest in the real world despite being fully digital and networked. Ethereum managed to one-up Bitcoin with the smart contracts of which the DAI stablecoin which anchors itself to the real world currency without relying on authority.

NFT's basically are the exact opposite of the sort of thing cryptocurrency offers as value to the real world.

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