Today, McDonalds, Starbucks, Pizza Hut, and others accept bitcoin in El Salvador
- Thread starter johnarb
- Start date
It was a grammar mistake on my part. I meant to say "it's faster than a credit card transaction and it's a contactless payment
Fun fact, if presented with a lightning network qr code invoice, you can take a picture, txt it to your cousin in the US and he can pay for it, but that would cause a delay. The point is the payment can be made by someone thousands of miles away
To me cryptocurrencies have lost their niche the moment they became trackable and that infinite versions of them can be created by anyone and that it's hackable with no guaranteed security. The biggest selling points of cryptocurrencies that have been touted about are: anonymity, storage of value and savings in financial transaction costs.
So far anonymity is moot at least with bitcoin that one has to be registered with all of their personal information and even with government-issued identification with any crypto exchanges. And it's just a matter of time that the government around the world would require registration in some form to use any of the other cryptocurrencies and when that happens, anonymity goes out of the door. So that leaves storage of value and savings in financial transaction cost.
With storage of value, it's great that bitcoin and with many cryptocurrencies that it has finite amount of them that can be in existence due to its design so that in theory would make it much superior storage of value and potentially combatting the existence of inflation but that advantage is totally erased when there can be infinite types of cryptocurrencies all similar to bitcoin that can be created just by anyone and they can all be used interchangeably with bitcoin or other cryptocurrencies that have finite amount of them in circulation. It's like even though bitcoin is finite but there can be infinite amount of bitcoin-like currencies out there that can be used like bitcoin so which one are we going to use as the storage of value for fiat that we are currently using? Not to mention that there are many cryptocurrencies that can have infinite amount in circulation just like fiat. And that begs the question, if we already have fiat that has infinite amount in circulation that can potentially give rise to inflation, why do we need cryptocurrencies that are just as infinite as the fiat? The answer is the third advantage: savings in financial transaction cost.
Savings in financial transaction cost is the biggest selling point but is it? Sure it might save financial transaction cost that bank charges but all those savings are just being replaced by the enormous expenditures on cybersecurity, insurance and massive data storage for any places that accept, exchange, trade, maintain storage of cryptocurrencies and those cost are just as enormous as the financial transaction costs. And that is still no guarantee to hacking attempts or even downright fraud by the places that store cryptocurrencies. There have been numerous instances of owners of cryptocurrency exchanges themselves disappearing or "dying" under mysterious reasons with hundreds of millions of dollars worth of cryptocurrencies and are nowhere to be found. And all those who cryptocurrencies stored with them are gone! And there is no way to even trace them or recover the money because they don't exist!! They can easily be converted to any other cryptocurrencies that are untrackable and then converted back to fiat to be spent. So what's the point of saving transaction costs when at the end you can't even safeguard your own money to make sure it's always there?
To me, at the end crypto has just become another commodity for trading, another game table at the casino of market (that is if you can store your crypto safely and properly) and nothing more.
Yeah with your cousin calling you back telling you that the price has just gone up by 20%.
I propose an experience:
Let's make a non-stablecoin crypto the legal tender of an island, without any connection to the outside world. They can only contact business and get salaries in that crypto. This crypto also can not be listed on any exchange, thus there is no way of telling its value in dollars or euros or whatever.
Then let's see how it works.
Let's make a non-stablecoin crypto the legal tender of an island, without any connection to the outside world. They can only contact business and get salaries in that crypto. This crypto also can not be listed on any exchange, thus there is no way of telling its value in dollars or euros or whatever.
Then let's see how it works.
You didn't address any of my points. When a Salvadorian negotiates his salary, is he thinking of its Bitcoin value or its dollar value? Obviously its dollar value, because it is rather stable, this value expressed in bitcoins fluctuates by the MINUTES.
Now let's say I am your Salvadorian employer and I hire you for the annual salary of 1 BTC. My business has connection to the outside world thus I can exchange my business profits for dollars. Your negotiated salary in Bitcoin WILL NOT fluctuate, until I give you a raise, or cut your salary.
Let's say Bitcoin's value quickly doubles in dollars. Suddenly my labor cost is double, although you have just started to work a week ago so you are not that experienced (thus I am not paying extra for something extra value). So I may as well just fire you and hire someone who is willing to work for half a Bitcoin.
Now let's say the opposite happens, Bitcoin drops to half in dollars. I am happy, because I got a fool I mean a slave in you who is willing to work for a 50% cut. You probably want more money and since I am not going to give it to you, you will quit.
See how a highly fluctuating asset can not be a good exchange of value? It is either very inflationary, or very deflationary (everyone starts to hoard it).
Right now the Salvadorian experience is nothing but an extra step, and more (or legally all) businesses can accept it, but it is still just an IN-BETWEENER.
The invoice cannot change, it is valid for a specified time, usually 15 minutes or less
I was on the Twitter Spaces that happened spontaneously with 10's of thousands of participants and at the center was President Bukele and his brother (who's a government official)
One of the questions was how to guarantee that a vendor/merchant is not exposed to the volatility if she/he chooses not to take the risk
I remember the answer was if using the government-issued official (Chivo) bitcoin wallet, there will be an option to convert to USD immediately or within 30 minutes
But because bitcoin is a decentralized open monetary network, any wallet app can be used, in which case, the option to auto-convert to USD won't be an option
There are many open-source bitcoin LN wallets, I use BlueMoon connected to my Umbrel node over Tor
To get physical USD, a Salvadoran would need to use a Bitcoin ATM which charges high fees, so the government of El Salvador installed Bitcoin ATM's with no fees(?)
"Article 8. Without prejudice to the actions of the private sector, the State shall provide alternatives that allow the user to carry out transactions in bitcoin and have automatic and instant convertibility from bitcoin to USD if they wish. Furthermore, the State will promote the necessary training and mechanisms so that the population can access bitcoin transactions.
Article 9. The limitations and operations of the alternatives of automatic and instantaneous conversion from bitcoin to USD provided by the State will be specified in the Regulations issued for this purpose."
https://www.bloomberg.com/news/arti...-bitcoin-rollout-with-200-atms-for-conversion
https://www.cato.org/blog/bitcoin-law-counterfeit-free-choice-currency
Too many factors to consider on your post. The answers will be up to each individual
Please see my previous post re: the instant-conversion of btc to USD
I will make a separate post which others have already mentioned earlier in the the thread re: reference of value which is USD
I have a feeling Indian scammers are already rubbing their palms together thinking about this sweet deal.
Others already mentioned but it needs clarification. The price reference for goods and services in El Salvador is still the US $
The price volatility occurs on the bitcoin price
100M satoshis = 1 btc
0.00000001 btc = 1 sat or satoshi
Let's say btc is at $50,000
200,000 sats = $100 = 0.00200000 btc
20,000 sats = $10 = 0.00020000 btc
2,000 sats = $1 = 0.00002000 btc
So, on a day like today, if you were trying to purchase a cell phone for $100, it was going to cost 0.002 btc in the morning, but in the afternoon, it would cost you 0.00222223 btc
Yes, your savings in bitcoin went down in value against the USD, but the reverse is true when bitcoin goes up to $100K
It's part of investing in a volatile asset like bitcoin, but over time, bitcoin will go up in value vs USD, imho
Imagine when bitcoin is worth $500K in 2025 how much better off the people of El Salvador will be?
And by the way, the bitcoin wallet app does all of the real time conversion to US $ via an api price feed from the exchange so no need to bust open a calculator every time
The price volatility occurs on the bitcoin price
100M satoshis = 1 btc
0.00000001 btc = 1 sat or satoshi
Let's say btc is at $50,000
200,000 sats = $100 = 0.00200000 btc
20,000 sats = $10 = 0.00020000 btc
2,000 sats = $1 = 0.00002000 btc
So, on a day like today, if you were trying to purchase a cell phone for $100, it was going to cost 0.002 btc in the morning, but in the afternoon, it would cost you 0.00222223 btc
Yes, your savings in bitcoin went down in value against the USD, but the reverse is true when bitcoin goes up to $100K
It's part of investing in a volatile asset like bitcoin, but over time, bitcoin will go up in value vs USD, imho
Imagine when bitcoin is worth $500K in 2025 how much better off the people of El Salvador will be?
And by the way, the bitcoin wallet app does all of the real time conversion to US $ via an api price feed from the exchange so no need to bust open a calculator every time
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