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El Salvador abandons Bitcoin as legal tender

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Re: El Salvador abandons Bitcoin as legal tender

#301

Post by coliveira »

openrisk wrote: post #278

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 sel…

Especially when to maintain their Ponzy scheme, crypto players need to use an enormous amount of electricity that could be used to benefit humanity. It is a huge waste or energy and time.

Re: El Salvador abandons Bitcoin as legal tender

#302

Post by markasoftware »

derriz wrote: post #82
block_dagger wrote: post #49

Earlier quoted context omitted.

Those who continue to invest in and use the Lightning (layer 2) network think it will be used as currency but most see it as a long term storage of value, at least until infrastructure supporting layers 2 and 3 mature. As for “magically,” there’s nothing magic about its increase in value as it replaces legacy technology, chiefly gold as a store of value.

Except it has none of the properties of gold as an asset. The value of bitcoin is highly correlated with equities and anti-correlated with gold. It’s the opposite of what you want to be holding as a hedge against a stock market crash.

When I think of the "properties" of gold I don't think of how the price behaves, but rather that the total supply of it is limited (though Bitcoin actually does a much better job at limiting supply, since gold'll keep being mined for a long time and the supply is hard to predict) and that, other than theft, there's no way for someone else to take it from you (compare to eg money at a bank that can collapse or in a stock of a company that can go bankrupt)

Re: El Salvador abandons Bitcoin as legal tender

#303

Post by kragen »

postalrat wrote: post #290
kragen wrote: post #260

Earlier quoted context omitted.

Also nobody can premine it, no coalition of big stakeholders can lock you out of your coins, a 51% attack is less likely feasible than for any other PoW coin, the bandwidth needed for its blockchain is smaller than most alternatives, and it's less likely to conceal unknown cryptographic weaknesses. It's kind of shitty in some other ways, though.

And eventually the math will be solved and every bitcoin will be worth zero.

While that's conceivable, Merkle-graph systems like Bitcoin are surprisingly resilient. It's been almost 20 years since MD5 was thoroughly broken, but still nobody has published a second preimage attack. For SHA2 and SHA3 nobody has even published a collision attack. And SHA-256 (what Bitcoin uses) is post-quantum-safe (Grover's algorithm still needs 2¹²⁸ time) though AFAIK there isn't yet a post-quantum cryptosystem deployed for signing transactions, which will require a hard fork.

Presumably if quantum computers (or better DLP algorithms on classical computers) start breaking keys, that will become a priority.

So I think there's an excellent chance that even if the math is solved Bitcoins will retain their value. Perhaps even without many of them getting stolen in the process. This is a big difference from many other uses of cryptography; if someone breaks IDEA 20 years from now, they can decrypt your PGP messages from the 20th century, and there's nothing you can do now to prevent that.

Re: El Salvador abandons Bitcoin as legal tender

#304

Post by 2030ai »

Arainach wrote: post #210
ToValueFunfetti wrote: post #203

Earlier quoted context omitted.

If the USD was such a good currency, why does the US operate at a deficit?

A deficit is not a loan. The USD and the historical strength and faith on the US allowed the US to offer its own securities, not ones pwned by and with terms dictated by external entities.

It smells, looks and quacks like a loan.

Re: El Salvador abandons Bitcoin as legal tender

#305

Post by varenc »

mikepurvis wrote: post #164
codethief wrote: post #152

Earlier quoted context omitted.

> 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…

And quite apart from that fundamental misalignment, sovereign states having some measure of control over their own monetary policy is arguably a pretty good thing .

This is moot for El Salvador. They’ve been dollarized since 2001 and USD is effectively the only legal tender.

Re: El Salvador abandons Bitcoin as legal tender

#306

Post by olalonde »

Analemma_ wrote: post #172
desumeku wrote: post #36

Earlier quoted context omitted.

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.

They also use USD as legal tender. Is their USD experiment a failure too?

Re: El Salvador abandons Bitcoin as legal tender

#307

Post by pasquinelli »

EVa5I7bHFq9mnYK wrote: post #277
kylebenzle wrote: post #207

Earlier quoted context omitted.

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.

this is the funniest way to reply

Re: El Salvador abandons Bitcoin as legal tender

#308

Post by EVa5I7bHFq9mnYK »

sporkydistance wrote: post #58
ks2048 wrote: post #33

Do pro-bitcoin people still talk about goals of bitcoin being a currency that people use daily? I don't follow it closely, but that idea seems to have faded and now it's just an asset to buy and hold while it magically goes up forever.

Why would anyone spend a single BTC/sat. if they know it could be worth 10x more in a few weeks/years?

Because people are mortal.

Re: El Salvador abandons Bitcoin as legal tender

#309

Post by coliveira »

mikeyouse wrote: post #40
k__ wrote: post #14

"if someone owes you money and wants to pay you in bitcoin, you can refuse to be paid in bitcoin, but you cannot refuse if it’s legal tender" Wat

Under the former law where bitcoin was legal tender, if someone owed you money, they could insist that you accept bitcoin to settle the debt. Most people wanted nothing to do with bitcoin so they removed the legal tender designation.

Who would want to receive payment in a currency that can lose 20% of its value in an afternoon? Only speculators are interested in this.

Re: El Salvador abandons Bitcoin as legal tender

#310

Post by attila-lendvai »

twothreeone wrote: post #45

I don't particularly like BTC (as it senselessly burns huge amounts of energy, thereby actively contributing to the destruction of our biosphere), but this news post is intentionally misleading. As reported by many other outlets (e.g. [1,2]), El Salvador abandons BTC to qualify for an IMF loan - so the IMF is pressuring them towards this move (presumably for political reasons). [1] https://finance.yahoo.com/news/el-s…

and USD senselessly burns up entire countries... e.g. most recently that giant, and very destructive money loundering operation in ukraine...

somehow everyone forgets that wars don't make sense and shouldn't really be financeable... and yet they are.

BTC can burn orders of magnitude more energy if it makes financing wars just twice as hard as it is today...

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