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Bitcoin Government

El Salvador Congress Votes to Revoke Bitcoin's 'Legal Currency' Status (reason.com) 57

Posted by EditorDavid from the bye-bye-Bitcoin dept.
After finalizing loan terms with the IMF, El Salvador's Legislative Assembly approved changes to the country's Bitcoin Law last week by a 55-2 vote, "effectively removing bitcoin's status as legal currency," reports Reason. Under the new rules, bitcoin is no longer considered "currency," though it remains "legal tender." Another change makes using bitcoin entirely voluntary. (Previously, the law mandated that businesses accept bitcoin for any goods or services they provided.) Additionally, bitcoin can no longer be used to pay taxes or settle government debts. The government is also stepping back from its involvement in Chivo Wallet, the state-backed digital wallet...

The reforms come as part of a broader financial agreement between Bukele and the International Monetary Fund (IMF). One of the conditions for a proposed $1.4 billion Extended Fund Facility loan was that El Salvador mitigate "potential risks of the Bitcoin project." The IMF has been critical of the country's crypto policies since Bukele made bitcoin legal tender in 2021. "There are large risks associated with using Bitcoin as legal tender, especially given the high volatility of its price. We don't recommend it," the organization said in 2022.

Despite these changes, the administration insists it remains committed to bitcoin. Milena Mayorga, El Salvador's ambassador to the United States, has said that El Salvador is still a "bitcoin country" and will maintain — and even expand — its bitcoin reserves. "You have to adapt to the current situation and this is the decision that was taken in the Assembly, but that does not mean that the country will stop having a bitcoin reserve," she explained.
Government data suggests El Salvador now holds 6,072 Bitcoin worth $586,888,000.

El Salvador Congress Votes to Revoke Bitcoin's 'Legal Currency' Status More | Reply

El Salvador Congress Votes to Revoke Bitcoin's 'Legal Currency' Status

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  • Think you'll find 6072 BTC is worth roughly $587.1 million USD???

  • BTC is worth more (Score:4, Informative)

    by r1348 ( 2567295 ) on Saturday February 08, 2025 @07:01PM (#65152829)

    Government data suggests El Salvador now holds 6,072 Bitcoin worth $586,888.

    No, you missed by three orders of magnitude, although it was likely a typo.

    Right now it's worth 585.941.385 USD

    • Re:BTC is worth more (Score:4, Interesting)

      by Firethorn ( 177587 ) on Saturday February 08, 2025 @09:11PM (#65152957) Homepage Journal

      Except that it has the same problem as, say, Elon Musk's shares of Tesla stock. Any attempt to actually liquidate that much bitcoin would crash the price.

      • Musk could liquidate it and get out before the crash. That's why he was trying to get that $55 billion dollar package

        The trouble with El Salvador is Bitcoin was always just a way for their upper elites to hide money overseas that they had stolen from the public in preparation for when they inevitably have to flee the country. So it's not really worth much of anything to the country itself.

        • Musk could liquidate it and get out before the crash.

          Absofuckinglutely not, lol.

          You don't put $120something billion dollars of stock on the market for sale without the price reacting instantly.
          The only way to not scare the market, is to liquidate in small amounts, over time.

          • He'll do a pump and dump and come up with an excuse for it when he dumps his stock and the same people who bought Trump's meme coin will eat it up.

            That's how we got the cyber truck. He promised us a $40,000 off-road EV was 500 mi of range. If he had done that it would have basically doubled the value of Tesla. He was of course lying but the stock jumped like crazy when he did it. The only problem was he got sued and lost over the pay package and it threw the timing of his pump and dump off.

            I think th

            • He'll do a pump and dump and come up with an excuse for it when he dumps his stock and the same people who bought Trump's meme coin will eat it up.

              No, dude.
              Someone- anyone- drops $100B of TSLA on the market, and every institutional investor there is will promptly do the same.
              The existing puts will pull get their ownership, which will be a tiny, tiny fraction of the $100B he just put out there, and the price will fall through the floor.

              There's a reason, he didn't just liquidate $40B of TSLA to buy Twitter.
              The $7.5B he *did* sell dropped TSLA's value by 12%.

              I think the problem is that people are formulating opinions with absolutely no thought spe

        • Musk could liquidate it and get out before the crash.

          I don't know by what basis you make this claim but this would certainly not be true for any normal stock, let alone a bubble stock like Tesla.

          Are you perhaps thinking that his position in the US Government could allow him to do something underhanded? Certainly he could, but that would probably mean defrauding other rich people. They don't like that.

          • I think his position is a carnival barker that the SEC refuses to rein in is what's going to let him get away with it. There's too many people, many of them here on this forum, who just believe he is some kind of inventing genius.

            So he'll do another cyber truck and everybody will get excited in the stock will bump like crazy. Only this time his company will be incorporated in Texas and he won't get sued when he tries to take his pay package. Then he don't sit and yeah the stock collapses but it's curren
            • If your really believe this you could make a lot of money by taking short positions on Tesla.
              • It's not that easy. It's not enough to know that Tesla is overvalued, and it's not enough to believe that Musk is planning what the parent claims, you need to know when he's going to do it. A short position isn't something that you can leave open indefinitely, you need to close it at some point and you're paying money for it all the time that it's open.

      • Bitcoin market is way deeper than you imagine. 6000 Bitcoin could easily be liquidated at near market prices.

        • It's not even 1% of daily volume.
          This is a classic example of people having trouble making sense of large numbers.

      • That small amount would not even move the price 1%

    • I think it's that thing where some countries switch periods and commas for decimals.
      Anyway, this thread is worthless now.

  • They're still buying Bitcoin (Score:4, Insightful)

    by leathered ( 780018 ) on Saturday February 08, 2025 @07:07PM (#65152833)

    > Government data suggests El Salvador now holds 6,072 Bitcoin worth $586,888.

    And they bought more just the other day. The IMF should have insisted that they stop and sell their reserves before receiving any more loans. It's like giving money to a gambling addict.

    • Re: (Score:1, Troll)

      by Rujiel ( 1632063 )
      El Salvador isn't a gambling addict, but the IMF is a thug entity (and not in the tupac sense of the word)

      • Re:They're still buying Bitcoin (Score:4, Insightful)

        by nocoiner ( 7891194 ) on Saturday February 08, 2025 @07:46PM (#65152879)

        El Salvador isn't a gambling addict,

        If that's so true, then why is it begging the IMF for a loan?

        • Re: (Score:1)

          by Rujiel ( 1632063 )
          Are the other nearly 100 countries who've taken the loans also gambling addicts? Low quality comment

          • Re: (Score:3)

            by Sebby ( 238625 )

            Are the other nearly 100 countries who've taken the loans also gambling addicts? Low quality comment

            Were they also required to reduce their risk due to their use of cryptocurrency?? High quality question.

          • Re: (Score:1)

            by DarkOx ( 621550 )

            Of course they are;

            They are gambling they can invest and out grow the debt. The IMF of course is gambling they can't. The real goal of the IMF is 'soft colonialism'.

            Your nation goes into debt and becomes dependent on IMF supports and continuing loan roll overs and expansion, The IMF forces you to do things that then align to NWO interests or the money stops.

        • At zero interest? Who wouldn't beg for that?

          • I wouldn't, I have had loans at 0 interest in the past and psychological burden of them was not worth it to me. For example I paid for my daughters tuition on my credit card, its interest free until the 6th of the month following the statement date (I had the cash) I couldn't stand it, I just paid the money it just wasn't worth it to me.

      • Ya, fuck those IMF guys trying to keep their emergency funding pool solvent.
        El Salvador is always free to ask Chase for $1.4 billion, though I suspect they'll like the terms of that loan even less.

    • Of course, it makes perfect sense to mandate people accept a currency that fluctuates significantly in value in the time it takes to just verify the transaction. Who knew?

  • What about muh geothermal powered bitcoin mining city of freedom?!?!?!

  • You spend currency, crypto isn't spent that way (Score:5, Insightful)

    by sziring ( 2245650 ) on Saturday February 08, 2025 @09:36PM (#65152969)

    People don't really buy with crypto so it can't be a currency. Crypto is more inline with a security, like stock.
    The same way people who trade with their gut are speculators not investors (trading based on facts).
    If more people framed it this way they might second guess what they should spend their hard earned money on.

    • Re: (Score:3, Interesting)

      by outsider007 ( 115534 )

      I understand that El Salvador has a mobile app where you send and receive funds on a L2 (low transaction fee secondary blockchain).
      Apparently their economy is heavy on oversea workers remitting back home, and yes it's a niche situation but I can see it working for them.

      • Would have been great to read an article regarding how bitcoin worked or didn't work as a national currency. The linked story didn't address this aspect. I think once strange aspect would be how to post prices in a grocery store? Even in California, bananas are 70 cents per pound. in bitcoin that's 0.00000725 bitcoin - too easy to make huge errors with this. Just think how crazy the story would go trying to keep prices current with ever-changing currency rate!

        • And if you know that dollar in your hand will still be a dollar tomorrow you are more likely to spend that as opposed to that faction of a bitcoin that could go up in value. I personally would only spend the crypto if i assumed it was going to drop.
          Who wants to be the guy that spent $41 in pizza in exchange for 10k in bitcoin. Maybe in 10 years it will be a good deal afterall ;)

    • Re: (Score:2)

      by coop247 ( 974899 )
      And like a stock tries to value the future performance of a company that produces some goods or services, crypto tries to value the performance of, uhhh, vibes, and feels. Totally the same.

    • People do in fact use it to buy things. The IRS makes it painful, so it's unlikely to take off in the US like that, but that's a strictly American issue.

      Also, notably, the SEC and the IRS disagree with you that Bitcoin is a security.

  • They're goining to replace them with Trump coins, aren't they.

  • Dr Jack Kruse, and American antivax doctor that supports decentralized medicine helped El Salvador write Bitcoin into their constitution. He thinks that decentralized finance and decentralized medicine are awesome concepts. I don't usually see something I'm a fan of intersect with something I'm deeply opposed to. Strange. https://mindfulmedicina.castos... [castos.com]

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