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El Salvador abandons Bitcoin as legal tender

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Re: El Salvador abandons Bitcoin as legal tender

#271

Post by npalli »

portaouflop wrote: post #188

IMF gave them 1.4 billion to abandon the “experiment”: > The IMF made this a condition for a loan of 1.4 billion US dollars (1.35 billion euros). In December of last year, the IMF reached an agreement with President Nayib Bukele’s government on the loan of the stated amount to strengthen the country’s “fiscal sustainability” and mitigate the “risks associated with Bitcoin,” as it was described. —- I dislike cryptocur…

What do you mean "gave" them 1.4 Billion? It's a loan so it has to be repaid. Usually, this is unsaid but with crypto people you sometimes have to explain basic financial conditions. Also, the loan was to bail them from risks of Bitcoin.

Re: El Salvador abandons Bitcoin as legal tender

#272

Post by josu »

CamelCaseName wrote: post #227
awnird wrote: post #196

Earlier quoted context omitted.

If bitcoin was such a success then why did they need an enormous loan?

El Salvador and their Bitcoin experiment are ultimately both quite small. This loan is multiple times larger than their total BTC holdings

They hold 6k BTC, around 600M USD. So just a bit over 2x.

Re: El Salvador abandons Bitcoin as legal tender

#273

Post by [deleted] »

JumpCrisscross wrote: post #248
chungy wrote: post #232

Earlier quoted context omitted.

I dare you to come up with a single example of someone that has a billion dollars in liquid assets. They probably don't exist: "billionaries" are worth billions on paper, thanks to stocks, investments, real estate holdings, etc. All in all, billionaires are a bad example of holding legal tender, because that just doesn't happen.

> a single example of someone that has a billion dollars in liquid assets Lots of billionaires manage their portfolios conservatively. Your equating currency with liquid assets is unnecessary and tanks your argument. Almost nobody holds billions of dollars in legal tender other than those who have to, e.g. sanctioned countries and criminals.

[deleted]

Re: El Salvador abandons Bitcoin as legal tender

#274

Post by olalonde »

kristjansson wrote: post #191
portaouflop wrote: post #188

IMF gave them 1.4 billion to abandon the “experiment”: > The IMF made this a condition for a loan of 1.4 billion US dollars (1.35 billion euros). In December of last year, the IMF reached an agreement with President Nayib Bukele’s government on the loan of the stated amount to strengthen the country’s “fiscal sustainability” and mitigate the “risks associated with Bitcoin,” as it was described. —- I dislike cryptocur…

Conversely if that’s all it takes to induce them to give up it tells you something about the benefits they felt were accruing from BTC.

They're not giving up on Bitcoin. In fact, it's likely that they'll use the loan to buy more Bitcoin.

https://www.reuters.com/markets/currencies/el-salvadors-bitc...

Re: El Salvador abandons Bitcoin as legal tender

#275

Post by FabHK »

Terr_ wrote: post #160
bawolff wrote: post #108

Earlier quoted context omitted.

> That reminds me of Hong Kong, where I used to live and which maintains a large sovereign wealth fund to ensure its currency is pegged to the US dollar. That doesn't sound like a soverign wealth fund. Foreign currency reserves are not the same thing as a soverign weath fund.

I'm not sure what you're reacting to here, I never said it was just US currency reserves. (Those are a component, sure, but that's hardly abnormal.) > The Exchange Fund of Hong Kong is the primary investment arm and de facto sovereign wealth fund of the Hong Kong Monetary Authority. https://en.wikipedia.org/wiki/Exchange_Fund_(Hong_Kong) It's also 10th-largest on: https://en.wikipedia.org/wiki/Sovereign_wealth_fund#L…

HK has a currency pegged to the USD via a currency board, that is (similar to a stable coin) backed one-to-one with USD denominated short-dated treasuries. That is within the HK exchange fund operated by the HK Monetary Authority.

The exchange fund also (and somewhat controversially) runs additional portfolios (with foreign shares and bonds, and private equity, real estate etc.) in the manner of a sovereign wealth fund.

Re: El Salvador abandons Bitcoin as legal tender

#276

Post by purist33 »

portaouflop wrote: post #188

IMF gave them 1.4 billion to abandon the “experiment”: > The IMF made this a condition for a loan of 1.4 billion US dollars (1.35 billion euros). In December of last year, the IMF reached an agreement with President Nayib Bukele’s government on the loan of the stated amount to strengthen the country’s “fiscal sustainability” and mitigate the “risks associated with Bitcoin,” as it was described. —- I dislike cryptocur…

There is a book called "Talking to your daughter about Economics", where the author explains one of the problems with bitcoin is, you cant print more of it in a crisis. Maybe thats what happened here.

Re: El Salvador abandons Bitcoin as legal tender

#277

Post by EVa5I7bHFq9mnYK »

kylebenzle wrote: post #207
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…

Yeh, it failed so hard no one even uses it anymore.

The article says "92% of Salvadorans did not use bitcoin in their transactions in 2024". Which means that 8% did use it in their transactions.

Re: El Salvador abandons Bitcoin as legal tender

#278

Post by openrisk »

Imagine if the amount of ingenuity that went into building the elaborate speculative digital game that is crypto was actually used to lift underdeveloped countries from their misery. Fighting corruption, enabling healthier local economies, reducing the siphoning of wealth to offshore centers, improving financial literacy etc. etc.

Solving real problems is hard. Being distracted by snake oil salesmen, whether they sell digital scarcity or AGI only makes things worse.

Re: El Salvador abandons Bitcoin as legal tender

#279

Post by coliveira »

redundantly wrote: post #230
tapoxi wrote: post #229

Earlier quoted context omitted.

But you're not supposed to hold legal tender, by design you're supposed to spend it.

gestures at all of the billionaires

People don't get rich holding currency. They spend it to invest in businesses, stocks, real estate, bonds, etc.

Re: El Salvador abandons Bitcoin as legal tender

#280

Post by liontwist »

throwaway519 wrote: post #233
portaouflop wrote: post #188

IMF gave them 1.4 billion to abandon the “experiment”: > The IMF made this a condition for a loan of 1.4 billion US dollars (1.35 billion euros). In December of last year, the IMF reached an agreement with President Nayib Bukele’s government on the loan of the stated amount to strengthen the country’s “fiscal sustainability” and mitigate the “risks associated with Bitcoin,” as it was described. —- I dislike cryptocur…

They're actually paying to give it up then. That's a hard fail.

Did the value of their holdings drop over the past few years?
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