i remember laughing at crypto nerds about this a few years ago, but who’s laughing now?
me, still
Crypto prices from a few years ago were hilariously low. Keep laughing tho!
El Salvador apparently invested about $270 million in bitcoin since 2021 and that investment is worth about half a million bucks now. Oh my god, ha, what idiots!
Source?
That feels incredibly off. Bitcoin is around 100k now while back then it topped out at ~65k or so?
They didn’t buy it all at once. The price dropped between then and now and they were buying. Wikipedia has an entry on it.
I’m not an expert on El Salvador’s bitcoin, I just know you all sound like a bunch of sore losers.
Just because you had luck doing something incredibly stupid doesn’t mean it was a good decision
I know you’d like to characterize it as dumb luck because that would make you feel better. The reality is that I’ve been making small monthly bitcoin purchases for the better part of a decade as a part of a much larger retirement fund.
When the btc price hit $100k, I sold most of the initial investment so that now I’m just risking losing part of my gains.
You can call it lucky and incredibly stupid. I can call it calculated risk.
So you’re rich because others also bought into the completely unproductive ponzi scheme. Go brag somewhere else, loser.
You’re all mad because you lost money investing in bitcoin when it was pumping and then selling during a crash. Don’t worry, it’s safe with me.
literally no one cares, fuck off dweeb
Ok, can he sell it then? What’s the use of Bitcoin? Why are you valuing it in Dollars? Countries accumulate Dollars and other first world currencies to be able to import more. Bitcoin is sitting there doing nothing.
Same applies to massive foreign exchange reserves like in the case of China. But still, atleast forex reserves can be quickly used to stabilize the exchange rates.
Yes, he could sell it.
It’s commonly used as a store of value. When people invest in gold, what’s the use of that? They’re not going to actually use the gold for its physical properties.
I’m American and the unit of value that I’m most familiar with is dollars. We could convert it into any currency that you’d like. I could have also said simply that their investment had about doubled in value and roughly had the same initial value as about 10 economy cars.
Sovereigns aren’t the same as individuals. For sovereign, at the macro level, spending drives consumption and creates employment of real resources.
If El Salvador had its own currency, they could tax and spend that instead. But no, they use US Dollars.
What’s the point you’re trying to make here? You seem mad about el salvador’s bitcoin experiment. They made a little of money on their little investment.
They make no money from the investment you mentioned unless they sell for Dollars. Your stock portfolio gets you no money in form of capital gains unless you liquidate it for Dollars. Same with gold.
Is El Salvador budget denominated in gold or bitcoin? No, it’s denominated in Dollars.
El Salvador should first stop using a foreign currency, the dollar. Then worry about trying to attract capital inflows.
I agree. No currency or store of value has any true value until you go to spend or exchange it. It only has potential value.
You do realize that Dollars also are also constantly changing in value.
If El Salvador had its own currency, they could tax and spend that instead. But no, they use US Dollars.
This is a legit criticism. It’s absolutely wild that these colonized states are completely monetarily subservient to empire. I think they go with bitcoin instead of their own currency, because bitcoin is much harder to destroy/manipulate.
The IMF is forcing them to sell it. They probably want it.
now do nvidia
I can’t say I understand the bitcoin hate in this thread. I have very real, realized gains.
Your meme should say, “I love working for minimum wage at Wendy’s”
they could have bought rolling 16x futures on gold in or 5x on cacao beans in 2021, just saying, with better success chance and lower risk. The fact that you won (allegedly) in casino doesn’t make you smart, it makes you lucky, it’s bonkers to do for a country
You seem pretty smart. They should probably put you in charge.
thanks 😉
i don’t understand why you dorks are laughing when i advocate for the use of tulips as legal tender. i’ll have you know that i recently cashed out during the height of this latest tulip bubble! you rubes are simply jealous of the treats i can now buy and the very coherent and good point i’m making.Wow you are funny. How many years has this act been going on?
El Salvador apparently invested about $270 million in bitcoin since 2021 and that investment is worth about half a million bucks now. Oh my god, ha, what idiots!
… Okay just to clarify, you’re saying they invested $270,000,000 and now it’s worth about $500,000?
Is there a typo in your comment or something?
Yes, there was. Thank you.
The problem with any new kind of currency no matter what it is will always be controlled and manipulated by the wealthiest individuals who will flood their wealth into that new system.
Strike the word new.
The thing we all knew would happen, did happen. Crypto is only useful to commit financial crimes and even for that it’s bad.
If he were smart, he would bring back the Colon and stop using US Dollars. But noo he had to do stupid shit like Bitcoin.
He’s just a US puppet, Trump literally called him a dictator and said that the Salvadoran people areremoveds and murderers, and Bukele is still licking the US boot. Just like South America’s failson dictator wannabe Daniel Noboa and Captain Ancap in Argentina.
Captain Ancap in Argentina.
And note not even he wants to do crypto
It’s would be much much easier to manipulate the Colon. That’s why it no longer exists.
Crypto is a massive scam. It has no value. It is just used to obscure fraud.
If you think crypto is a scam, wait until you learn about how fiat currency works. Crypto is a great idea that has been plifered by scammers trying to make another pump and dump scheme.
It really isnt that far off from the stock market, and there are books of regulations involving share trading because all the various frauds commited over the centuries, though most are to protect the captial…
Not really scammers but speculators.
A means of exchange shouldn’t be a speculative investment, the two objectives are at odds with each other.
I mean neither does FIAT currency, U.S. currency is based on taxes , there is nothing that backs it. Majority of GDP is just finance. We need more education on what and how a currency actually works.
Nothing backs US currency?
I’d argue the US military backs the US dollar.
Violence based currencies are not sustainable in the long term. That’s why the petrol-dollar has been steadily decreasing in global reserves. It’s why the IMF has to outlaw bitcoin instead of competing with it.
The value of a unit of currency is based on someone else’s willingness to accept it. If you’re willing to accept two clam shells in exchange for one widget, then our clam shell currency has value between us.
Almost anyone in the world is (currently) willing to accept a US dollar. There will be some exchange rate and transaction fee, so maybe I demand three dollars instead of two. I know that I can convert those three US dollars into my local currency that others are willing to accept.
The whole premise of bitcoin is that the line will continue going up and someone will always be willing to pay more for it than what you paid. If you agree to sell your car for one bitcoin, and tomorrow it crashes, you just lost the entire value of your car. The chances of a sovereign currency crashing is never 0, but it’s much more stable than bitcoin.
Almost anyone in the world is (currently) willing to accept a US dollar. There will be some exchange rate and transaction fee, so maybe I demand three dollars instead of two.
This is exactly the same with crypto. You might argue there are technological barriers to using bitcoin but many of those barriers apply to petrol-dollars as well.
The whole premise of bitcoin is that the line will continue going up
The whole premise of fiat currency is that the line will go down so rich people constantly need a ROI and poor people are constantly pushed deeper into poverty. This is not a superior system.
an extremely volatile speculative asset primarily used for buying drugs, gambling, and illegal pornography doesn’t work as an actual currency?
who would have guessedHalf of El Salvador doesn’t have electricity or internet, Bukele is just a far-right weirdo who probably thought this would attract Techbros to invest in his regime.
Wow the misinformation
This is good for bitcoin
WOAH what a surprised maybe it’s because half of the fucking country lacks electricity or internet? Really good job Bukele.
Well I’m sure the petrol-dollar will fix all that stuff like when El Salvador was a utopia before bitcoin. \s
Did bitcoin fix their economy?
Who could have predicted this
Let’s not get astray here.
The reason El Salvador stopped using Bitcoin as a legal tender is not because it’s some sort of failed experiment (it had issues, but still), but due to continuous pressure of IMF interested in maintaining a US dollar-centric economy.
El Salvador is reliant on US dollars in its economy, which puts it under heavy US influence. Knowing Salvadoran currency wouldn’t be strong, Nayib Bukele suggested an alternative option - risky, volatile, but free from pressure of other countries and strongly appreciating in the long run. IMF didn’t like it, and that’s where we are.
So, when you cheer Bitcoin not being legal tender anymore, you also cheer US and IMF projecting power over the country.
Well, also, they just cut a deal with Marco Rubio to be America’s prison, so they must’ve figured that was more lucrative than Bitcoin and continuing to agitate the US by challenging the dollar was creating unnecessary friction.
Yeah the headline is insane. This would have been a wildly successful experiment, and now is a great time to cash out.
I guess they made a deal to sell their coins to the US.
Edit: misinformation, sorry. They’re not selling. they’re still buying. The IMF is just forcing them to strike the word legal tender
Exactly. The title is misleading af
They were forced to stop using Bitcoin as legal tender by external parties. The question people should be asking is why? And the answer is not that it was a failed experiment.
The experiment was to move beyond external parties. They were not able to do so and returned to using external parties. Ergo “the experiment failed”.
They were forced to do it by the IMF and US
Why do you think that they’d care about it if it was failing?
So they experimented with resisting the US and IMF and it was not successful.
We call that an experimental failure.
You really don’t get it. “Blockchain” was not the experiment. “Utilizing blockchain in the global economy” was the experiment.
And it failed.
Again, for the people in the back:
The experiment was whether or not they could be independent monetarily. Not whether or not blockchain works. But whether, in actual practice, if it could provide the monetary independence some people claim it has the power to do.
Outside influences were strong enough to overwhelm Bitcoin adoption and it succumbed to those outside influences. As an experiment seeking to test whether or not Bitcoin could resist these influences it failed.
This is how experimentation works. Now you can tweak your experiment and try again, but acting like failing at the exact thing you were trying to accomplish is somehow not an experimental failure is just delusional.
You can argue semantics all you want
They were trying to break free using Bitcoin. It seemingly worked quite well so they were forced to stop doing it. The article title is misleading in the sense that the failure isn’t from Bitcoin (quite the contrary).
You don’t even have to be pro bitcoin to see this as something bad, but feel free to keep supporting such propaganda and external influence of politics. I’m sure it really benefits you
Would you loan money to someone who wouldn’t be able to repay if the bitcoin market crashed?
Its even funnier. They just straight up promised them a billion dollar loan on the condition that they abandon bitcoin.
In December, the government struck a $1.4 billion loan deal with the International Monetary Fund (IMF) that scaled back its bitcoin embrace after the lender urged officials to limit its exposure. The lender specifically advocated making acceptance of bitcoin voluntary for the private sector, which is spelled out in the hastily-approved law.
Hot damn why is this not the headline we are seeing
Thats what im wondering, because thats the blog post headline i first saw.
Site doesn’t load
The link is still working and reuters is a huge organization so its probably an issue on your side.
Nope. Their site is always broken. It doesn’t work on tor browser in strict mode. Try it.
We shouldn’t be linking to such websites
That is hardly a valid reference point for a news source. The site even works without JS which is better than most sites.
Nope. It doesn’t work with js disabled. That’s the problem
It does in librewolf, which means that Tor is just doing some extra blocking of stuff that is need for the page to load.
Bitcoin isn’t good for making little purchases, firstly because it takes so long to get confirmations, if each block is 10 minutes and you need like 3 blocks to consider it confirmed that’s 30 minutes. But that ties into the second issue which is that you probably don’t want millions of tiny transactions on the Blockchain, you want them processed off-chain and then settled in bulk (to the Blockchain) periodically as a single transaction.
Bitcoin is great for little transactions if you use the lightning network. Sending on the lightning network means instant payments with no confirmation required and absolutely tiny fees. And the only thing that shows up on the blockchain is the transactions to initially start using lightning network and to take your coins back off the lightning network. Transactions made over the lightning network aren’t recorded anywhere other than maybe by the people transacting.
i got back into bitcoin recently and decided to move the contents of my old wallet to a new SegWit one and look into using lightning.
To open a lightning channel i have to stake £170 up front though which is crazy, how are people in poorer countries supposed to do that?
or even here. poverty is on the rise, a lot of people are living hand to mouth and just having that kind of money lying around isnt a thing.
i like the idea of bitcoin but i worry it doesn’t scale well.
Add to that that virtually nowhere accepts it. The value of bitcoin comes from its use as a currency. if it doesn’t have that then it’s entirely speculation.
oh well, i have £2k in there and i’m not turning it back into fiat. I’ll spend it if i can or ride it all the way to 0 if that’s the way it goes
An infinitely growing blockchain will inevitably fail by centralizing. Crypto-currencies as they exist today are doomed, but the protocols and tech created now may hopefully inform the design of something that is useful as a currency.
Also, high transaction fees make it useless for small (normal, everyday) amounts, so it can only be used as a store of value. It’s really more analogous to gold or a stock, with the one significant benefit that it’s harder to steal than gold and can’t be
loststolen institutionally.There are no hard coded minimums. Some providers may demand a minimum commitment, but there’s nothing to stop people in poorer regions from opening smaller channels, especially between individuals. Any business attempting to operate in the region will have to work with that.
There is also a lot of work being done on… I think they call them channel factories? Might be off on the name, but basically create as many channels as possible in as little space as possible to keep it efficient and minimize costs for individuals.
if it doesn’t have that then it’s entirely speculation.
You are very close
“Bitcoin is great if you don’t use the block chain”
That’s what you just said. So why even use it in the first place?
Bitcoin is a great alternative to something like Western Union that charges high transaction fees. It’s time to transmit is comparable to a traditional back wire, but days faster than an EFT.
Everybody knows Bitcoin is too slow to process point of sale transactions on-chain but there are other Blockchain solutions that can do it. Another user mentioned the lightning network which still actually is Bitcoin but it’s another layer.
Also, I’ve just ignored the environmental impact of Bitcoin, which probably needs to move away from proof of work, or some other solution is required to lower the every requirements.
Yeah, and Zelle, Cashapp, venmo, PayPal all do the same and don’t have that environmental impact you so easily dismissed.
It’s been great watching Bitcoin grow from this digital currency for buying drugs online to having all these layers added on to almost sort of make it comparable to the systems we already have. By the time you guys actually make something that isn’t just stocks with no backing but faith, we’ll have moved on to a post-money society(probably not but I have more faith in that than blockchain ever being a useful currency.
The fact that one anonymous person could create a solution that “almost sort of make(s) it comparable to the systems we already have” is fucking amazing since all of humanity worked for like 70 years since the invention of the computer to create those systems.
Remind me again where Bitcoin is actually used vs actual databases. It didn’t solve anything and did it in an energy hungry way. It’s not “almost sort of comparable”. All of the scams that immediately came about because it doesn’t have the numerous regulations regular financial instruments have is proof. For the last decade Bitcoin has been struggling to reach parity with financial regulations. Ffs, the US PRESIDENT JUST PULLED A RUG PULL.
Blockchain is just digital speculation.
You’re the one who said it was “almost sort of comparable” to the systems we already have, I was literally quoting you. Then you disagree with yourself? Argue with yourself then, you don’t need me.
the lightning network still uses the blockchain, just less. it’s acts like an immutable public bar tab you can’t default on. once you have spent enough with another person that it is worth them conducting the transaction on chain then it does it. usually when fees are low too.
That is an extremely simplified explanation of how it works though, it is more complex than that.
Stil though, how well does that work with a rapidly fluctuating value of the bitcoin? Prices would have to be superfluid for external good to have known value of some sort.
Stability of the value of savings and currency seems crucial to using it for trade.
It’ll settle eventually
Won’t the economy have to go flat (stop growing) since the supply of bitcoin is fixed? Otherwise the value of bitcoin will always be going up. Which leads to hoarding and speculating, which was part of the reason for dropping the gold standard.
Unrelated note: part of why humanity stopped making our money out of precious metals was because the metal was worth more and more while the dollar held steady. So people started shaving the edges off silver coins, and then recievers had to start weighing money at the time of transaction (which slowed it all down). Making money fungible was a huge advantage for commerce.
Bitcoin transactions feel a lot like having to double check that the coins you’re receiving are actually “real” and that you’ll be able to trade them later. The lighting network feels like a tab at the hardware store where anyone can skip town anytime they want.
You still use it as a settlement and security layer. The lightning network is made up of pairs of people that both lock money in a new account with a transaction. Both people get a fully signed copy of a second transaction to reclaim the money, but they don’t publish it immediately. If they need to make a new transaction between each other, they just replace the second fully signed transaction with a new one that divides the money according to the new balance. They can do this as many times as they want for as long as they want, and they only have to make two transactions: one to start and one to stop. If anyone tries to cheat, the only thing they can do is publish an older version of that second transaction that favors them, but you have… I think a day or three, I forget, to publish a newer version that proves they cheated, and if you do, you get ALL the money even if some was owed to them, so cheating won’t go well. The down side is you need a node that’s always online or connects to the network frequently so you can be ready to catch a cheater.
To make a network, they use some fancy cryptography to send money to someone if and only if they send it (minus very, very, very small fees) to the next person in line towards the destination. If anyone in the chain refuses or fails to commit, the transaction fails and no money moves at all. Because it’s all secured by the blockchain, you can trust that everyone both can and will complete the transaction exactly as requested, or the whole thing fails and nothing happens.
You realize “it’s so energy and time consuming that we had to create a secondary layer to try and make it actually usable” isn’t the defense you think it is, right?
Sure glad that’s not why they did it because you’re right, that’d be kinda stupid. That’s not why they made a secondary layer, though. They made a secondary layer so transaction throughput can grow exponentially while maintaining the security of the blockchain without significantly impacting fees or requiring the blockchain itself to become proportionally larger.
That last part is the real motivation. The goal is to above all else, remain decentralized. That means the average user needs to be able to run a full node capable of verifying any transaction it needs to. To do that, the blockchain can’t grow too quickly, or people will get forced out. If it grew exponentially faster as transactions grew likewise, nodes would eventually centralize in fewer and fewer hands until someone could exert control over the network.
The blockchain is currently something like 650-700 GB, which is a lot, but most people can manage it, even if it might be pushing it for poorer regions. Without the lightning network and with substantial user growth, the only option is to increase the block size, and to achieve an actually usable capacity of strictly on-chain transactions, you’d be looking at sizes on the order of hundreds of TB or pushing into PB territory. Nobody would be able to store the blockchain without a dedicated server rack. Not a single server, a whole rack. It’d costs thousands and thousands of dollars to run a node. Instead, we acknowledge that you purchasing a pack of gum at the convenience store doesn’t need to be immortalized on the blockchain and use the lightning network to secure your transaction without having to create a permanent record.
Sounds like you can steal or fake things
IIRC, a deposit is made by two parties to create a lightning network channel that’s enough to cover all transactions (kinda like a multi-sig escrow), and both parties have to sign-off on their balances after every transaction (the last balance signed by both parties is the only valid state). I think most people would use a custodial wallet where the custodian already has channels set up, and this would require trust in the custodian. Lightning networks didn’t exist, and wasn’t fully spec’d out the last time I looked into it though.
Finally someone who knows what theyre talking about, with an actual valid criticism.
That’s the same way as the economic system works though
Each bank and creditor keeps track of if what they owe each other and then they settle the balancebetween them periodically (depends on the country)
If assume you could do something similar with bitcoin, but you would need an overlay
They could’ve solved that by making the block size larger, but instead did some weird ass replace-by-fee system.
The only surprise here is that they stuck with it for as long as they did.
Womp womp
‘’’ officials ensure that the government will continue betting on this cryptocurrency, whose price currently exceeds $100,000. ‘’’
I think that’s why El Salvador is dropping it. They never really forced people to use Bitcoin, US Dollar was also the legal tender and unlike Bitcoin, also the money of account.
But really though, can you call for IMF to stop lending to countries which buy Bitcoin when the issuer of Dollars, the U.S. has a President who has run multiple crypto/NFT scams and wants to use Government money to pump up crypto prices?
They wouldn’t be able to do all that evil stuff with the petrol-dollar if there were a valid alternative… Thus the IMF ban on bitcoin.
