Can Bitcoin save a nation that owes a lot of money / Debt - page 3.

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Quote from: zasad@ on March 07, 2024, 04:10:18 AM

I am a poor communicator on the situation in Pakistan.
But I understand a little about economics.
The very first thing I tell everyone is the words of Warren Buffett: “Bitcoin will cost 0.” And this must be understood correctly.
Nobody knows when this bubble will burst, in a year or in 10-100 years, but it will burst.
For the USA and Europe, this is a very small market, and a collapse in the crypto market will not greatly affect their economy, but for small countries this can be a very fatal mistake.

I am a big Bitcoin supporter and I do not think it is a bubble, someone like Warren Buffet who is a known stooge of the US, cannot destroy my belief in Bitcoin. I do agree there is a big risk to consider Bitcoin as a legal tender due to its volatility, but when Bitcoin goes up and you as in a country have Bitcoin as a reserve rather than Gold it does increase a country's reserves.

In Pakistan, the problem is different as the current selected government is full of those who are known to be corrupt. I said selected because of the Pakistan army controlling the output of the election. If the leader is known as corrupt and the Army is known to be the backbone that controls everything happening in Pakistan how would then Bitcoin help that nation? Do a Google search about the current election in Pakistan and you will see how the Pakistani army is controlling everything happening in that country.

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Quote from: pakhitheboss on March 06, 2024, 08:50:50 AM

Quote from: zasad@ on March 06, 2024, 05:16:36 AM

If I were the president of the country, I would not legalize Bitcoin. There is a very high risk of potential scam here. The first miners and users received bitcoins for a very small amount, and now one bitcoin costs more than $60,000.
If El Salvador now has unrealized profits, this does not mean that these profits will last forever. Prices are also falling.

I agree they as in the top brass or the elites who are only 10% will easily corrupt the miners or the financial advisors to get control over Bitcoin. The present government is full of corrupt leaders and they are again in power because of the backdoor Army control. You would not believe it the Army produces everything and is the biggest infrastructure developer in Pakistan.

EL-Salvador is a country that was the one to adopt Bitcoin as a legal tender. That was in the year 2021 when Bitcoin created a new ATH, till now they survived and improved their economy because their President was a visionary. Assuming they bought Bitcoin when it was in its ATH, last night Bitcoin reached that price point and with the current market condition it is going to create a new ATH in a few days. What will you have to say then about Bitcoin with spot ETF money coming in Bitcoin is going to create some huge ATH.

I am a poor communicator on the situation in Pakistan.
But I understand a little about economics.
The very first thing I tell everyone is the words of Warren Buffett: “Bitcoin will cost 0.” And this must be understood correctly.
Nobody knows when this bubble will burst, in a year or in 10-100 years, but it will burst.
For the USA and Europe, this is a very small market, and a collapse in the crypto market will not greatly affect their economy, but for small countries this can be a very fatal mistake.

pakhitheboss

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Quote from: zasad@ on March 06, 2024, 05:16:36 AM

If I were the president of the country, I would not legalize Bitcoin. There is a very high risk of potential scam here. The first miners and users received bitcoins for a very small amount, and now one bitcoin costs more than $60,000.
If El Salvador now has unrealized profits, this does not mean that these profits will last forever. Prices are also falling.

I agree they as in the top brass or the elites who are only 10% will easily corrupt the miners or the financial advisors to get control over Bitcoin. The present government is full of corrupt leaders and they are again in power because of the backdoor Army control. You would not believe it the Army produces everything and is the biggest infrastructure developer in Pakistan.

EL-Salvador is a country that was the one to adopt Bitcoin as a legal tender. That was in the year 2021 when Bitcoin created a new ATH, till now they survived and improved their economy because their President was a visionary. Assuming they bought Bitcoin when it was in its ATH, last night Bitcoin reached that price point and with the current market condition it is going to create a new ATH in a few days. What will you have to say then about Bitcoin with spot ETF money coming in Bitcoin is going to create some huge ATH.

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Quote from: Poker Player on March 03, 2024, 11:48:03 PM

No. Countries like Pakistan, if they want to get out of the hole, have to start by spending less than they earn. Exactly the same thing happens as in a family or a company, not expecting a magical investment to get you out of trouble.

The value of the bitcoins purchased by El Salvador is $150M and the GDP is around $34 billion, meaning that the price increase, although not go bad, will not have a very significant impact.

Quote from: zasad@ on March 03, 2024, 05:14:08 AM

For a country's debts to decrease, its economy must develop. Buying Bitcoin does not increase the economy.

Well, unless you become famous for making Bitcoin legal and attract investment for it, as has happened in El Salvador, that does help develop the economy. But you're right that just buying Bitcoin doesn't.

If I were the president of the country, I would not legalize Bitcoin. There is a very high risk of potential scam here. The first miners and users received bitcoins for a very small amount, and now one bitcoin costs more than $60,000.
If El Salvador now has unrealized profits, this does not mean that these profits will last forever. Prices are also falling.

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No, what's the point to have a better investment if the profit will be corrupted by public servant? Pakistan is currently ranks 140/180 countries in corruption perceptions index.

This is the reason why every countries always be same, the rich is still rich, the poor is still poor, even though the president and public servants changed, but they still brought the cultures, if the country is popular with corruption, then the corruption culture won't end.

They need an iron hand president who want to end the corruption culture, don't mind to fire a big civil servant that didn't give any contribution, brave enough to catch sharks that can control few places etc.

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Quote from: UmerIdrees on March 03, 2024, 12:27:54 AM

Considering this condition of any country, can Bitcoin help in this to recover from this crisis by probably adding BitcoinBTC in national reserves and not only focusing on US Dollars Huh

How do you add Bitcoins to your reserves when you have no money to pay your current expenses and you would need more $ in order to buy BTC because if you would try to buy $10 billion (that's 10% of Pakistan debt) worth of BTC with Pakistani Rupee the exchange rate would go down by an order a magnitude well before you would be able to purchase that.

There are huge differences between a single individual exchanging some of his earning to Bitcoin which won't move the fx rates by even 0.000001% and a total different thing when a country would embark on a $10 billion foreign currency purchase.

Quote from: NeuroticFish on March 03, 2024, 01:35:25 AM

But from what I know, El Salvador has pretty much done the same: bought bitcoins, although their economy looks bad.

Salvador had for two consecutive years the lowest GDP growth in central america, they ran a 700 million deficit last year, they would need with their current holdings Bitcoin at $300k for all their coins to cover one year of deficit!!!

pakhitheboss

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The first thought that comes to my mind when I hear the name Pakistan is corruption and the second thought is the Army. Bitcoin can be a saviour for Pakistan but you need to ask a few questions from yourself.

Do you think the corrupted leaders and the Army will try to consider Bitcoin as a legal tender? Your country is being played by the US and China for their benefit. Will these powerful countries allow Pakistan to adopt Bitcoin and forget about the US dollar or the Chinese Yuan?

The answer is no! I am sorry about the current economic situation of Pakistan and I don't think the situation will change in the future. If you want to change the way Pakistan is being run then find a good leader. Not everyone can be as Nayib Bukele, the President of El Salvador.

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I read an article that mismanagement and lack of good governance are the deep causes of most of Pakistan’s economic problems even though it has abundant natural and human resources; It has the fifth largest gold reserve in the world in Balochistan province, the second largest salt reserve and the sixth largest coal reserve in Punjab, but it was unable to exploit these resources for its economic benefit.

Therefore, if the government, which has all these resources, is constantly borrowing and does not find alternative solutions to pay off the debts, I do not think there is any solution to get out of the crisis, neither Bitcoin nor anything else.

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Bitcoin is not a magic wand which can save the economy of bankrupt countries. Not sure why people are always over estimating about the power of Bitcoin, but in reality it is just a cryptocurrency. It is not built to replace the banks or to save the economy. Bitcoin has thrived as a parallel currency system and I believe that's exactly where Bitcoin shines.

Pakistan economy can be saved only if they choose to bring peace with their neighbours and if they stop supporting terrorism.

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Quote from: zasad@ on March 03, 2024, 05:14:08 AM

For a country's debts to decrease, its economy must develop. Buying Bitcoin does not increase the economy. The financial sector increases the economy only according to statistical data, but if the profits from this sector are not distributed to real sectors of the economy, such as manufacturing, agriculture, medicine, education and others, then the country will continue to borrow and depend on the policies of other countries.

Bitcoin cannot save Pakistan. Leadership and management can.

Pakistan have a large market and I know this well because as a person from Nigeria, we import clothes, shoes, jewelries, handbags from Pakistan. And I know that they have people from other countries who patronize them. And there is market for anything that they want to sell.
However, I feel that if Pakistan changes their leadership just as El Salvador and invest in their physical and human infrastructure they will in no time clear off their debts.

Good leadership and management will help Pakistan clear off their debt not bitcoin.

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No. Countries like Pakistan, if they want to get out of the hole, have to start by spending less than they earn. Exactly the same thing happens as in a family or a company, not expecting a magical investment to get you out of trouble.

The value of the bitcoins purchased by El Salvador is $150M and the GDP is around $34 billion, meaning that the price increase, although not go bad, will not have a very significant impact.

Quote from: zasad@ on March 03, 2024, 05:14:08 AM

For a country's debts to decrease, its economy must develop. Buying Bitcoin does not increase the economy.

Well, unless you become famous for making Bitcoin legal and attract investment for it, as has happened in El Salvador, that does help develop the economy. But you're right that just buying Bitcoin doesn't.

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For a country's debts to decrease, its economy must develop. Buying Bitcoin does not increase the economy. The financial sector increases the economy only according to statistical data, but if the profits from this sector are not distributed to real sectors of the economy, such as manufacturing, agriculture, medicine, education and others, then the country will continue to borrow and depend on the policies of other countries.

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Usually Bitcoin price doesn't really rise when you want and as much as you'd like (although now, fueled by ETF, the rules may change).
However, buying Bitcoin costs money, so the country may have to get into more debt and also the money will be locked in bitcoins, not fueling the economy.

But from what I know, El Salvador has pretty much done the same: bought bitcoins, although their economy looks bad. And obviously, IMF was far from happy.
This for us, bitcoiners, may look like a fun fact, but if the country needs more money afterwards, the standard banks borrowing more will not give that.
So it may be more than tricky to solve this just by buying some bitcoins. Plus it depends on luck and also how fast they'd move. Because buying near ATH is another problem.

UmerIdrees

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I was studying a recent financial magazine where there was an article start that Pakistan has taken a lot of debt from other countries and it is almost difficult to pay it back in time.
Although the article did not mention any crypto solution but only focused on having more industries on small and large scales to improve exports and increase the foreign reserves.

Considering this condition of any country, can Bitcoin help in this to recover from this crisis by probably adding BitcoinBTC in national reserves and not only focusing on US Dollars Huh

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