El Salvador wants to make BTC legal tender

[whm1974]

2 minutes ago, Heliian said:

Crypto currency yes, btc and other wildly volatile betting games no. 

 

Well, this works in favor of the oppressive government who can't control cash and barter. 

 

In the end, this isn't even newsworthy, El Salvador is not a stable country and nothing that the president says is based in reality.  

You said it best. Are there any Central and South American Government that are Stable?

[Brooksie359]

5 hours ago, Moonzy said:

my point is that there's a chance of it going up again, so the net effect should be following the long term trend-ish(?)

you seem to only focus on the negatives (for a good reason), what if the value goes up after the transaction? "good for them i guess"

 

guess i misunderstood this then

maybe you meant 30% of the time it's going down, which can be "high", but not higher than 70% of it going up

 

not an economist like I said

but i guess shorter term has to trend change before long term so...

I get that they could possibly make more money but what's the point? Having more profit one week to lose money next week is not a good way to run a business. How are you supposed to predict how much money to spend and budget when your profits are so unpredictable? 

[Master Disaster]

11 hours ago, whm1974 said:

Air is Totally Physical. Are you saying Matter doesn't Exist?

Nope, I'm saying you don't have to be able to touch something for it to exist.

 

BTC exists, it just isn't tangible. If it didn't exist then we wouldn't be having this conversation, instead we'd be talking about how this guy has lost the plot and is trying to adopt magic as a currency.

[Moonzy]

9 hours ago, Brooksie359 said:

I get that they could possibly make more money but what's the point? Having more profit one week to lose money next week is not a good way to run a business. How are you supposed to predict how much money to spend and budget when your profits are so unpredictable? 

I don't disagree that Bitcoin is bad for this kind of stuff as I said in my first reply

 

All I have against is you seem to think crypto price will only go down if one is holding it, which is kind of strange

 

Nonetheless, it's an option that stores will have, no one is forcing them to use it afaik, whether it works out for them or not, they would know better than me or you, probably

[Brooksie359]

7 hours ago, Moonzy said:

I don't disagree that Bitcoin is bad for this kind of stuff as I said in my first reply

 

All I have against is you seem to think crypto price will only go down if one is holding it, which is kind of strange

 

Nonetheless, it's an option that stores will have, no one is forcing them to use it afaik, whether it works out for them or not, they would know better than me or you, probably

I think you don't understand what legal tender means. It means that businesses would be legally required to accept it as payment just like businesses in the US are legally required to accept USD. This whole thing is about them making bitcoin legal tender for their country which is why all the problems I stated are a big deal because businesses won't have a choice if this goes through. 

[Moonzy]

38 minutes ago, Brooksie359 said:

legally required to accept it as payment just like businesses in the US are legally required to accept USD

you can convert it to USDT right that instant if they wish

i don't see the issue here

 

no one has to hold BTC

[Brooksie359]

1 hour ago, Moonzy said:

you can convert it to USDT right that instant if they wish

i don't see the issue here

 

no one has to hold BTC

Well for one now you are requiring business to invest in a method to not only complete the transaction with bitcoin efficiency while also setting up a method to instantly transfer the bitcoin to fiat currency. I mean now the guy that sells fruit in a fruit stall has to be able to accept bitcoin while also transferring it to fiat currency. This not only cost money for simply transferring from bitcoin to fiat currency it also cost money to invest in a system to do so. 

[Master Disaster]

2 hours ago, Brooksie359 said:

I think you don't understand what legal tender means. It means that businesses would be legally required to accept it as payment just like businesses in the US are legally required to accept USD. This whole thing is about them making bitcoin legal tender for their country which is why all the problems I stated are a big deal because businesses won't have a choice if this goes through. 

It doesn't, at least not in most places.

 

Legal tender means its recognised by the courts as a legal way to pay a debt, in most well economically developed countries private businesses don't have to accept the countries main tender if they choose not to though it does get pretty complicated.

 

Taking the US as an example, federal law states that if a business is buying stuff on credit then the debtor has to, by law, accept cash as payment for it however if it is a simultaneous transaction (as in you walk into a shop, pick up an item and pay for it on the spot) then the shop has no legal responsibility to accept cash if they don't want to. States are free to apply their own laws to overrule this if they choose to.

 

https://www.federalreserve.gov/faqs/currency_12772.htm

[staticpage]

4 hours ago, Brooksie359 said:

I think you don't understand what legal tender means. It means that businesses would be legally required to accept it as payment just like businesses in the US are legally required to accept USD. This whole thing is about them making bitcoin legal tender for their country which is why all the problems I stated are a big deal because businesses won't have a choice if this goes through. 

That's not how it works. Take a $100 bill and go around your town trying to spend it. Where I live just no-one will take it (fear of counterfeits) . I get paid in cash sometimes, its a PITA to find a gas station or store that will take them.

[Bombastinator]

Specifically their President created something.  If that happened in the US it would mean very close to squat.  I don’t know how their government works.  Perhaps their president is much more powerful that way.  This whole subject though is so incredibly prone to exaggeration though that it’s hard to trust anything particularly positive or negative.  This would be extremely good news for Colombian drug cartels because the other legal tender there is the US dollar, so what that old effectively do is make Bitcoin freely convertible with dollars.  I while this would help Bitcoin it could also destroy the dollar. Also there are Colombian drug lords that have been accepting only Bitcoin for years and it would effectively launder all their money. Might it give El Salvador a quick bump at the cost of destroying the economy of the US? Possibly. 

[Brooksie359]

41 minutes ago, staticpage said:

That's not how it works. Take a $100 bill and go around your town trying to spend it. Where I live just no-one will take it (fear of counterfeits) . I get paid in cash sometimes, its a PITA to find a gas station or store that will take them.

There have to be specific laws to overrule that though. It has to be accepted as payment for a debt but some places have laws that say that it doesn't have to be accepted before the debt occurs but again you would have to make that distinction. It sounds to me like they will be forcing businesses to accept it as otherwise what is the point of making it legal tender? 

[Heraldique]

On 6/6/2021 at 12:07 PM, Master Disaster said:

The president of the Central American country has just announced plans to make BTC legal tender in the country. Should his plans be approved by congress he claims it would allow the 70% of El Salvadorians who don't have a bank account to have access to financial services and could help boost the countries GDP.

Source - https://www.bbc.co.uk/news/world-latin-america-57373058

 

Pretty interesting idea for a relatively poor country however I have reservations about using an unregulated currency as a main currency for the entire country. It makes it very easy for money to disappear without anyone realising.

I mean if an entire country use them it gives some security to people who trade with this coin 

[Heraldique]

But how many El Salvadoran have access to a mobile phone capable of doing crypto? How many even have access to the internet? 
 

i wonder how this new Bitcoin cryptocurrency could be applied in real life. 

[Primotter]

The law is currently being presented and pending voting tonight, but if anyone wants to read the law (in English) here it is:

 

https://twitter.com/nayibbukele/status/1402446890466217985/

I will update you all when we have the voting results.

Spoiler

 

 

Edited June 9, 2021 by Primotter
Adding the images inside spoilers

[Primotter]

1 hour ago, Heraldique said:

But how many El Salvadoran have access to a mobile phone capable of doing crypto? How many even have access to the internet? 
 

i wonder how this new Bitcoin cryptocurrency could be applied in real life. 

 

https://ilifebelt.com/estudios/abc-sv-informe-digital-de-el-salvador-2020/

This is a (paid) "digital inform" of El Salvador, but you can see in the preview images that we have a round 57% of the population that has internet access

Spoiler

I couldn't find a specific inform that has a specialized focus here but this is enough to get a rough estimate

[Bombastinator]

Looks like El Salvador is going to create a laundry for huge amounts Colombian drug money, legitimize bitcoin, and destroy the US dollar. 

[Primotter]

With 62 votes in favor and 19 against it, the law got approved. El Salvador now has bitcoin as legal tender.

 

 

[Moonzy]

1 hour ago, Primotter said:

El Salvador now has bitcoin as legal tender

Hmm... I guess this is a first(?), interested to see how this pans out

 

Maybe there are things that I simply can't imagine.

[Primotter]

Not sure if this should be a new topic but...

The president has ordered the country's geothermal electric company to create a plan to power up crypto mining

Spoiler

 

And local news article (in spanish) about it:
https://www.elsalvador.com/noticias/negocios/bitcoin-criptomonedas/847105/2021/
 

[Bombastinator]

15 minutes ago, Primotter said:

Not sure if this should be a new topic but...

The president has ordered the country's geothermal electric company to create a plan to power up crypto mining

  Reveal hidden contents

 

 

 

 

 

And local news article (in spanish) about it:
https://www.elsalvador.com/noticias/negocios/bitcoin-criptomonedas/847105/2021/
 

Well the horse is out of the barn now.  We’ll have to see how it goes.  There are electricity producer that do cryptomining.  Generally because they have occasional oversupplies of electricity they can’t sell.  They don’t do it all the time. If this geothermal plant has periodic overproduction issues it could make sense.  Don’t need to make the stuff legal tender to do that though.  What I find particularly worrisome is that the country also uses the US dollar as official currency at the same time.  I do not know how that is going to go but it could be very very bad.