Topic: El Salvador close to default? (Read 204 times)

The question is - can anyone explain how, in countries like El Salvador, the introduction of a crypt (bitcoin) instead of / in parallel with the main currency will help the economy avoid degradation, inflation, etc. ?
The fact that it has become a fashion trend among losers is a fact. But no one on their side can clearly explain how the introduction of bitcoin "fixes" the problems described above or helps to minimize the consequences of such problems? Maybe someone here can explain?

president Nayib Bukele seems quite aggressive about Bitcoin use. That's would not be a proper way to convince citizens to use Bitcoin. Then citizens will take it negatively. There should just be open Bitcoin opportunities and let them use your citizens. Like, allow Bitcoin mining massively with renewable energy. The wallet system should allow internal users to make transactions for free. That's how should handle adaption. Then Citizens will be more interested to earn money.

The answer is simple: El Salvador had been chronically mismanaged for decades and Bitcoin adoption was never going to change that. In fact adopting a secondary currency, when you don't have any influence of your primary adopted currency was never going to solve a thing. It is simply populist garbage and a futile attempt by citizens to chase a new idea that seems to be the hype of the moment. Maybe El Salvador was looted long before the current president came to power, maybe he is continuing the tradition, but unfortunately changing currencies does not fix the underlying issues.

I don't if it's going to affect bitcoin that much, bitcoin is much bigger than this to be affected because of the investment of a country or organization. Elvalvador bought some bitcoins at a higher level just like the companies such as MicroStrategy but they didn't lose anything yet, El Salvador will lose when they sell bitcoins also this can be another chance for El Salvador and even some other people to buy for lower prices, if they saw what happened back in 2020 and in 2018 when the prices were falling down they will understand the price fall is hard but it's temporary. However, talking about a country I was expecting to see them have a bigger investing basket and more different assets other than cryptocurrencies to help them in this situation when they need it.

Only idiots can relate the current situation in this country to the fact that it declared Bitcoin legal tender a little over 6 months ago. I know that there are many who will turn this into a negative story and blame Bitcoin for everything, but El Salvador has been in real trouble for more than 20 years, and it is known that they gave up their national currency at that time. Yet the fact that Bukele bought another 500 BTC in a recent dip shows that nothing has changed in his strategy.

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I have shared this idea in the main ES thread and I still think it makes sense, but it should be said that the ES is not officially on the side of Russia, but they just abstained in UN voting condemning the aggression against Ukraine. It is difficult to say whether this had such disastrous effects on the interest in BTC bonds, but I remember that they justified the postponement with some technical problems, and at the same time they claimed that there was a huge interest from investors.

I think some investors were certainly affected by this decision, but despite all the sanctions against Russia, they still do very well with most countries in the world, billions of dollars flow into their treasuries every day, which means that there are a lot of hypocrites who say one thing and do something completely different. What I want to say is that it would have been much smarter if the ES had played a different card and condemned the aggression, and then, like most others, continued with its usual business.

I doubt that the situation in El Salvador is as bad as people who are against crypto, or who just want nations to do badly so that other smaller nations wouldn't get out of debt the same way, it is just bad as in how it has been bad so far before, and the same bad today, irrelevant to bitcoin. Obviously it is not really that great, obviously they are in big debt, obviously IMF is dragging their feet, and those are all terrible situations for them.

But, not like El Salvador was a golden nation with money flowing through the streets before the bitcoin legal tender deal, they were dirt poor, and they are dirt poor, bitcoin didn't change much about it.

Seems they doubled down and bought more. I personally don't understand why anyone that own bitcoin would need those bonds but seems the government really needed that money. Whatever the result is, them already having the "infrastructure" for transacting in bitcoins should still do some good in the future.

I think they are just trying to get the cheap energy out of them when they do not have many options to sell at the same time making it much easier to negotiate thus the country will have many benefits, which is undoubtedly very bad, concerning the war crimes being committed by the Russians and them attacking for more than 70 days, this is atrocious since last thing that we need is countries supporting*Russia*. Other than that ofcourse if they are going to do that other countries are going to refrain from making any deals with them along with investing in the bonds as well, with the current Trent the bitcoins is a bit down but at the end of the day it's not much that cannot be recovered soon, 4-5% have been normal in the market in the last month as well therefore I do have hoped that we are going to see +2-3% soon that might help El Salvador get some profit back if they choose to invest and hold right now.

I can't say of Central African Republic for now because we are still observing but i can tell you that El-Savador is pretty doing good as at now with bitcoin adoption, you can imagine how he make another purchase on bitcoin despite the downtrend, Bukele has made many progressive actions which were evident enough that supported their bitcoin adoption into advancement, i don't need to stress much on this, you can go through many threads on the forum that talks about El-Savador bitcoin adoption and achievements, there you will get enough proves and moves.

Along with El Salvador, the Central African Republic made important decisions regarding Bitcoin. Countries with economic problems want to produce new alternatives. These news haven't created a stir so far. We will need the concrete actions of these countries, not just their words 

It is one thing if its finances have historically not been very buoyant and another to go into default. When things go bad, they can go worse.

Another one I've been thinking about a lot lately is Saylor. If the price continues to go down I don't know how he is going to do. The MSTR stock was down 25% yesterday.

I'd say that if we get to real crypto winter, then there will indeed be troubles in paradise.
For now, they're still bragging for buying the dip (more 500 BTC yesterday, it seems) and there are still hopes that an actual crypto winter will not come this time.


But a lot of things there are simply politics. Lies covered with things that look good, maybe with a thin layer of actual good things too. Their president is kinda walking on thin ice. On one hand, if he stops, he's doomed; on the other hand, if he continues as recklessly as until now, only new ATH soonish may save him.
And yeah, overall finances of El Salvador may look gloomy, but .. when did they look great last time?

When El Salvador abandoned its national currency and pegged it to the dollar, the country fell into a trap. The dollar helped the country cope with inflation, but now there is a possibility of default. With such a huge debt, the country needs cash to pay it off. Perhaps they expect to do it with bitcoin? if they accept it as the second official currency. I think it's a bad idea. It was necessary to support the Salvadoran colon.

El salvador's GDP is $24 billion dollars. The failure of a $1 billion dollar venture in crypto amounts to around 4% of GDP and should not represent a significant threat to el salvador's economy unless they have other significant issues that are troubling them.

Tourism ranks in the top 3 of el salvador's industries. Hikes in gas and food prices have a tendency to cut into disposable income which usually hits hospitality and entertainment sectors associated with tourism the hardest.

Its been said el salvador has a tremendous unbanked demographic but that bitcoin adoption there has stalled for various reasons.

There is still a chance for crypto adoption in el salvador to take off IMO. I don't think circumstances there have reached a point of complete closure. What they currently lack is access to free electricity powered by hydroelectric energy to enable crypto mining as occurred in venezuela. Among other things.

This exactly but they are not the only one that offered this kind of bitcoin bond or some shit and even Mirostrategy offered almost similar stuff as well. That kind of bond are actually targeting people that havent had any bitcoin and some people just dont seems to understand what it means to keep their own bitcoin thus this kind of bond feels about right for them


Yeah it doesnt but thanks to Bukele fiasco by making it a legal tender, most of the people now know that bitcoin is not just a digital coins that serves no purposes at all. Its basically free advertising of bitcoin to the entire world and Its all good

There was no FUD, there was just a politician playing the masses like a pro!
After one full month of not mentioning Bitcoin even once, the Buakake trader is back at it, buying the "dip", because he knows he's in such deep shit he needs his fans to cover for him.

Everything about Bukele and his promises and his economics was just a bunch of lies

- the 95 MW well dug in two months, never existed, couldn't even exist at all as there is no such thing in the world
- free geothermal energy, lol, Salvador geo generated energy hasn't increased a bit in years
- miner's heaven with cheap green energy, lol, Salvador just launched a new 400 gas LNG powerplant
- the mining farm consisting of a container with 10 refurbished s15?
- the bitcoin bond, the bond that would fund building a city, another lie. The actual cost was 11-15 billion, and half of that billion would go into purchasing bitcoin. Now, if you don't have a brain-eating bacteria affecting you, why would you sell your coins, and buy Salvador bonds so that they can use them to buy bitcoins?
- let's break away from the US tyranny, after calling Biden a moron for saying Russia will invade Ukraine, lol, he also forgot another thing, that in June he received the aid of 115 million from the US, double the amount he spend on Bitcoin, and another large chunk in November, 300 million to be spent along with Honduras
- and of course, he fights against the evil FMI, while sending each month negotiators and pleading on all fours to lend him 1.2 billion
- by omission, the 400 million issued in debt to cover the government deficit in 2021?
- the pet hospital constructed with BTC profits when he has actually lost 25% in USD value, profits that, how you even have profits when you don't sell?

Bukake (not a typo) is the perfect example of why you shouldn't trust politicians at all, they don't do anything just for your sake, and all they do with your money, it wasn't Bukake spending his money he was spending his own people money to buy coins, the 30$ he gave he didn't do t from his own pocket, he did it from their own, juts like your wife takes your wallet to go shopping and you would assume everything was free because she bought it.
But people love to have a hero, laser eyes, tweets, and lies they know they are not true but you need to have something there, a guiding light, and just like religion when you desperately need some comfort. And there is Bukele, the savior! And god forbid showing them he is not a hero but a politician! Pitchforks!

Bitcoin doesn't need Bukele and it doesn't need Salvador's approval, bitcoin needs people that use its strengths for their own needs, bitcoin doesn't need politicians, politicians, and basements pos that live on likes and shares desperately need Bitcoin to have a reason in life.


Hope more learn this now and don't forget by the next tweet of some wanna-be senator who needs a comfy seat.

Indeed, now most people who have big finances try not to go against the flow, they have something to lose, so they will not risk their money in this whole story. They want stability, and they won't find it in El Salvador. Moreover, the recent fall of bitcoin to almost $30k is bringing El Salvador closer to collapse.

On the time that they had made out decisions on accepting or making Bitcoin as a legal tender then for sure they are fully aware on how things goes or how it do behaves and its impossible

that they weren't aware about on how price volatility do behaves or works which means that with this scenario then for sure they are prepared.The main question on here is that

how long they would able to sustain? Specially now that the price had come down on the worst 30k price  which i didnt really even expect to happen.

The bitcoin bond is set to be September of this year, but I wish Nayib Bukele did not talk in favour of Russia before the war started with Ukraine, people know that Nayib Bukele is supporting Russia. This can be one of the reasons that might made the bitcoin bond success to be retarded or become difficult to be possible as some investors that wanted to invest before may not invest again.

I am going to put a news that I do not know to what extent to believe, because there are many economic interests in propagating FUD about El Salvador and Bitcoin, but if we enter a bear market I think there may be some problems.

El Salvador's bitcoin bond reportedly hasn't lured a single investor, and markets are bracing for a default on conventional debt.


I am not very fond of believing politicians in general, and even less so when they deny something. The fact is that if the bond has failed to attract investors, if the price does not take off, and we even enter a bear market, if adoption there does not take off either... I do not know, I do not see a bright future in the short term, although I think Bitcoin is a good bet for the long term for the country if it manages to hold on through hard times.

What do you think?