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El Salvador abandons Bitcoin as legal tender

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Re: El Salvador abandons Bitcoin as legal tender

#341

Post by nicbou »

thinkski wrote: post #332
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.

Warren Buffett. Berkshire Hathaway has over $300B in cash reserves, Buffett owns 15% of Berkshire and directs investments — he chose to park all that value in cash reserves, roughly $50B of that is his share.

That's still shares of a company, isn't it?

Re: El Salvador abandons Bitcoin as legal tender

#343

Post by nicbou »

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.

I wonder what volume of all transactions it represents. I've used Swiss Franc this year but it's a fraction of a percent of all my transactions.

Re: El Salvador abandons Bitcoin as legal tender

#344

Post by patrickaljord »

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…

> I dislike cryptocurrencies as much as the next guy

Is this really the general sentiment on HN?

Re: El Salvador abandons Bitcoin as legal tender

#345

Post by raincole »

Mengkudulangsat wrote: post #2

> The government, she assured, will continue buying bitcoin and having reserves in this cryptocurrency Sounds like the term "Failed Experiment" is the writer's assertion and not the government official position.

The recurring theme is people will keep explaining why bitcoin has failed and will fail. And bitcoin will keep hitting all time high.

Re: El Salvador abandons Bitcoin as legal tender

#346

Post by odo1242 »

fny wrote: post #180
odo1242 wrote: post #171

Earlier quoted context omitted.

It might have worked if El Salvador made their own cryptocurrency which they control and could mint more of and backed it properly as a non-speculative legal tender, but they didn’t and that didn’t happen.

So... fiat?

Yes. A "digital fiat" currency, basically. It could potentially incorporate privacy features from cryptocurrencies or replace digital payment providers. Or be a ginormous waste of time. I don't really know enough to tell you which one.

Re: El Salvador abandons Bitcoin as legal tender

#347

Post by CalChris »

wmf wrote: post #146
abdullahkhalids wrote: post #20

In the 15 years since Bitcoin went viral, has someone proposed a reasonable social, legal and financial protocol for how a society can adopt a novel cryptocurrency without getting stuck in the phase where the cryptocurrency becomes a speculative asset rather than a common medium of exchange? By novel, I mean not using an existing cryptocurrency that is already stuck in the speculative asset phase. Surely, if a govern…

Stablecoins/CBDCs aren't speculative.

https://chainsec.io/failed-stablecoins/

Re: El Salvador abandons Bitcoin as legal tender

#348

Post by markasoftware »

ekianjo wrote: post #320
markasoftware wrote: post #285

Earlier quoted context omitted.

The post you're replying to is about Bitcoin being "used", not specifically "used for everyday transactions". Bitcoin has so far been a decent asset to hold as a store of value if you don't want to or can't store your money in the traditional financial system. Lots of everyday people in countries with high inflation or strict controls or how people can store money hold Bitcoin (or perhaps more commonly, stablecoins)…

BTC cash has lower fees I believe, I wonder if it could actually work as a currency for day to day payments.

It can work as a day-to-day currency, but it compromises the decentralization that is key to Bitcoin's usefulness as a store of value:

+ By allowing 8x larger blocks (unless it's even larger now?), if in widespread use with full blocks, the blockchain would be 8x larger. Bitcoin's blockchain is already the better part of 1TB, though you can still fit that on a cheap SSD. Imagine if it were 8 and growing fast.

+ Because BCH uses the same hash algo as Bitcoin, but is much less popular, it's at risk of 51% attack.

+ Because there is no pressure on block sizes, fees are very low, which means that as halvings continue the block rewards for BCH will get extremely small. This will result in hashrate continuing to decrease, putting it at even greater risk of 51% attacks. Bitcoin's high fees allow it to remain profitable for miners even without inflation. Miners have to be paid to keep the network secure, and that's either going to come from tx fees or from inflation. BCH aims to have neither and that puts it at risk.

And anyway, there are much better solutions for day to day payments, such as Monero and Ethereum.

Re: El Salvador abandons Bitcoin as legal tender

#349

Post by nosefurhairdo »

thinkski wrote: post #332
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.

Warren Buffett. Berkshire Hathaway has over $300B in cash reserves, Buffett owns 15% of Berkshire and directs investments — he chose to park all that value in cash reserves, roughly $50B of that is his share.

> While Buffett has stated that Berkshire Hathaway will maintain a permanent cash reserve of about $30 billion to fund potential insurance payouts, Bloomstran takes a more conservative approach and adds about $50 billion to that reserve level to account for a full year's worth of potential insurance losses.

From this article in 2024: https://markets.businessinsider.com/news/stocks/warren-buffe...

There is additional context there explaining why Berkshire holding cash reserves is unique to their needs, and historically has only represented 17.5% of their total assets.

Billionaires and large firms are not sitting on piles of cash Scrooge McDuck style, because holding cash is costly.

Re: El Salvador abandons Bitcoin as legal tender

#350

Post by markasoftware »

2030ai wrote: post #331
markasoftware wrote: post #297

Earlier quoted context omitted.

Fame is part of it, but it's more that it's IMO probably the only truly decentralized cryptocurrency. Not just in terms of the nodes and miners being well spread out between organizations and parts of the world, but also in terms of its development and governance. Sure, there's a relatively small group of core contributors to Bitcoin, but they don't have much fame or personality cults around them like Ethereum's Vita…

Eth famously forked and reversed txns due to someone getting scammed.

the fact that eth classic was created from this incident and still exists does inspire some confidence that ethereum's governance is somewhat decentralized also, to be fair.

And IIRC it wasn't a "scam", it was a bug in a smart contract.

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