The fear of Bitcoin monopoly in El Salvador

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Quote from: Husires on July 14, 2022, 11:21:13 AM

I can understand that El Salvador embraced Bitcoin but their way of investing was so haphazard as if they had never consulted anyone who is an expert in financial analysis or good at reading charts.

I remember that there was a chart of the purchase dates and it all seemed random without a solid economic plan as the price collapsed several times after the purchases.

With the way they were investing it was clear that they were overconfident that the price would not fall further and hence they invested even when the price had a correction to $40k but the price went down drastically and since they are investing public fund in the volatile market, they should have done better analysis before investment when the market was correcting.

Quote from: Husires on July 14, 2022, 11:21:13 AM

Currently and historically, the price is ideal for investment, but we did not hear more investments, which reflects the economic situation in that country.

El Salvador recently purchased 80 BTCitcoin at $19,000, but they are at a loss of $51 million.

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Quote from: Majestic-milf on July 14, 2022, 06:40:42 AM

In September, 2021, El Salvador became the first country to adopt Bitcoin as a legal tender; that, we are all aware of. Then President Nayib Bukele went further to spend a total of $106.3m, according to Bloomberg analysis, since it's adoption in 2021. This move was unwelcomed by citizens as they grumbled over the supposed waste of public funds but it sseemed like Nayib was looking at the futuristic benefits attached to this coins. Take a scenario where BTC skyrockets from it's present price of $19.608.8 to a high of $60k or $100k, they could become richer than China and the US combined if they decide to invest in their country like China did.
With it's adoption, the government introduced the use of chivo wallets because of its efficiency and lack of credit consumption.

Granted, Chivo is a public ledger, hence the citizens can be aware of transactions and all that. But where I need your opinions is on this: can it be made public enough to scare off monopolists?

Transfers on the network cannot be tampered with, but there are no guarantees that the government will not be able to track citizens' transfers through this wallet since it is closed source. The solution may seem easy by encouraging citizens to use more trusted wallets such as Electrum, but the government took advantage of people's ignorance of the Bitcoin network system and gave a gift of $ 30 to each person who carried the wallet application, leaving no room even to choose the most appropriate method for them. I am not at all surprised that the Salvadoran government is using Bitcoin to impose the same control it has with traditional currency.

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Quote from: Mauser on July 21, 2022, 01:54:36 AM

To me it seems only as matter of time for the bitcoin price to recover and reach a new ATH. With higher Bitcoin prices that could make El Salvador very rich,

Bruh, have you actually gone through this topic, have you done a bit of math for the coins Salvador has?
Even if the new ATH would be 1 million, their entire stash would be worth 2.31 billion, which means $367 per person?
Exchanged in flipping burgers it comes to 24 hours of BigMac grilling at the minimum wage in US, and that's all.
Would you consider yourself rich with $367 dollars?

Quote from: Poker Player on July 21, 2022, 12:46:55 AM

Brush up on your math and general macroeconomic knowledge. You don't need to do as detailed an analysis as stompix has correctly done to know that what you say is far from reality. It is a thing that with minimal knowledge is apparent at first glance.

Seems like that minimal stuff is severely lacking around here, I'm still not getting it, is it that hard to multiply two known numbers and compare them to something else? And if you think this is bad, you should not go over topics on how Bitcoin will turn CAR into a wealthy country. Wink

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Quote from: Majestic-milf on July 14, 2022, 06:40:42 AM

Take a scenario where BTC skyrockets from it's present price of $19.608.8 to a high of $60k or $100k, they could become richer than China and the US combined if they decide to invest in their country like China did.
With it's adoption, the government introduced the use of chivo wallets because of its efficiency and lack of credit consumption.

Granted, Chivo is a public ledger, hence the citizens can be aware of transactions and all that. But where I need your opinions is on this: can it be made public enough to scare off monopolists?

To me it seems only as matter of time for the bitcoin price to recover and reach a new ATH. With higher Bitcoin prices that could make El Salvador very rich, but it is mostly the government that holds these Bitcoins and not the citizen. I am not sure if El Salvador would transfer it new wealth to the population or just keep it for themselves. Comparing it to USA or China seems a bit off right now, because El Salvador is lagging so far behind. They need a lot of investment in their own country and while the money from Bitcoins would help them, they need to transfer that wealth into some form of production. A whole country can't only run on bitcoins. As for the monopoly I don't think it will be a big deal, as long as Bitcoins are free everybody can choose his own ledger and wallet.

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Quote from: Majestic-milf on July 14, 2022, 06:40:42 AM

Take a scenario where BTC skyrockets from it's present price of $19.608.8 to a high of $60k or $100k, they could become richer than China and the US combined if they decide to invest in their country like China did.

Brush up on your math and general macroeconomic knowledge. You don't need to do as detailed an analysis as stompix has correctly done to know that what you say is far from reality. It is a thing that with minimal knowledge is apparent at first glance.

Quote from: adaseb on July 20, 2022, 11:09:20 PM

I think the OP doesn’t realize how poor El Salvador is and how rich China and USA actually are.

The OP misses a lot of things, and confuses wishful thinking with reality.

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I think the OP doesn’t realize how poor El Salvador is and how rich China and USA actually are. Even if they bought 10x as many coins and Bitcoin did a 10x from here it still wouldn’t come close. The president buys very little every time he tweets.

Saylor and musk bought in the billions and the most El Salvador can buy is in the couple million or so. So won’t make much of a difference really. They just aren’t buying enough. Don’t understand most of the original post to be honest.

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Quote from: Zlantann on July 19, 2022, 11:51:38 PM

Quote from: romero121 on July 18, 2022, 11:54:05 PM

Since September El Salvador have started investing on bitcoin. As a result El Salvador now holds a good number of bitcoin. But there is no expected usage from the common people.

The Bitcoin revolution in El Salvador is less than one year, hence it might take more years for the inhabitants to accept and use Bitcoin for transactions. Also, the country have some foundational problems that needs to be addressed before Bitcoin would become generally accepted. High rate of illiteracy, infrastructural deficit, poor internet services, etc are some the impediments. As the government gradually tackle these issues Bitcoin usage would also improve. Nayib Bukele is a brave and bold leader, even if Bitcoin fail in El Salvador which is very unlikely, alt-least he has tried to seek alternative means of driving the economy of his nation towards prosperity.

At least to me this is quite important, how many times people complain the politicians that are leading the country are not really trying to help them at all? We may agree or not with Bukele but at least he's trying, he's trying to push El Salvador forward with a technology that he knows is going to be the future, and even if he fails at least he will be able to look at his actions and say that he tried his best for his people, which is more than what a great deal of the politicians around the world can say.

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Quote from: Majestic-milf on July 14, 2022, 06:40:42 AM

In September, 2021, El Salvador became the first country to adopt Bitcoin as a legal tender; that, we are all aware of. Then President Nayib Bukele went further to spend a total of $106.3m, according to Bloomberg analysis, since it's adoption in 2021. This move was unwelcomed by citizens as they grumbled over the supposed waste of public funds but it sseemed like Nayib was looking at the futuristic benefits attached to this coins. Take a scenario where BTC skyrockets from it's present price of $19.608.8 to a high of $60k or $100k, they could become richer than China and the US combined if they decide to invest in their country like China did.
With it's adoption, the government introduced the use of chivo wallets because of its efficiency and lack of credit consumption.

Granted, Chivo is a public ledger, hence the citizens can be aware of transactions and all that. But where I need your opinions is on this: can it be made public enough to scare off monopolists?

It is true that they can become very rich by investing in bitcoin but it will be on paper unless they can find someone/some country to exchange their products/services for bitcoins.

If not, to feed their people, they'll have to sell them coins which they bought earlier and it will create a sell pressure on the prices.

In the end they will need USD to make them trades.

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Quote from: romero121 on July 18, 2022, 11:54:05 PM

Since September El Salvador have started investing on bitcoin. As a result El Salvador now holds a good number of bitcoin. But there is no expected usage from the common people.

The Bitcoin revolution in El Salvador is less than one year, hence it might take more years for the inhabitants to accept and use Bitcoin for transactions. Also, the country have some foundational problems that needs to be addressed before Bitcoin would become generally accepted. High rate of illiteracy, infrastructural deficit, poor internet services, etc are some the impediments. As the government gradually tackle these issues Bitcoin usage would also improve. Nayib Bukele is a brave and bold leader, even if Bitcoin fail in El Salvador which is very unlikely, alt-least he has tried to seek alternative means of driving the economy of his nation towards prosperity.

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Quote from: TheNineClub on July 19, 2022, 03:48:27 AM

Quote from: Majestic-milf on July 14, 2022, 06:40:42 AM

Take a scenario where BTC skyrockets from it's present price of $19.608.8 to a high of $60k or $100k, they could become richer than China and the US combined if they decide to invest in their country like China did.

Ok, I need to repeat this as many times as possible it seems. BTC adoption does not / cannot / will not solve decades of underlying Economic issues. They still spent money while buying BTC, it didn't fall from the sky, so thinking they could become richer than the US and China combined is just false and without systemic fixes to the economy of a country, the political policies, crime, and corruption issues, IMF dependencies as well a dependency on the US dollar, and then jump-starting the economy, that BTC money means jack shit and countries shouldn't latch on to it for a quick fix solution.

Dont know on where they do get that idea about resolving economic issues and speaking about monopoly or some sort then it cant really just be possible.People should be at least realistic into things that they do have in mind which they do really believe into.They might able to reach out on becoming richer with those rich countries but it would really be just temporal.Even if they would get that title or headline at least
but sustaining themselves wont really be just too long because if we do talk about various sources and sustainability then it would really be just lasting for so long so they would really still
ending up on the same situation even though not like before at least since there would be definitely some progress after that.

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Quote from: stompix on July 14, 2022, 05:25:14 PM

Quote from: mk4 on July 14, 2022, 11:14:49 AM

El Salvador currently has 1,771 BTC[1]. BTC skyrocketing to $100,000 is going to end them with only $177m (not including the buy cost). That's literally nothing in contrast to how much funds the United States and China has.

[1] https://bitcointreasuries.net/

Yeah, that is just funny.

If Salvador would buy all coins available , 19 million of them, at 20k each they would first need about 400 billion to do so, their whole GDP is 24 billion so they would need 16 years of spending every single penny for coins.

Now, if all those coins could raise to $100,000, their whole value would be 1.9 trillion, which is about 9% of US annual GDP. To be richer than China and the US combined, now taking wealth into the equation, they would need to buy every single coin and each of those coins to be worth 10 million.

Quote

Granted, Chivo is a public ledger, hence the citizens can be aware of transactions and all that.

No it's not!

Yeah, while reading the OP I laughed a lot and I laughed even harder when they mentioned that it would be worth US and China combined! I think US itself spend more money on their military than what El Salvador could earn in couple of years. The amounts are in trillions man, and there is no bitcoin make you that rich just by going zoom from 19k to 100k. Tongue

Thats really psychh calculations.

Quote

Granted, Chivo is a public ledger, hence the citizens can be aware of transactions and all that.

These days don't believe what you see and it's harder to see when its digital. Be aware of political strategies, they are insane.

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Quote from: Majestic-milf on July 14, 2022, 06:40:42 AM

Take a scenario where BTC skyrockets from it's present price of $19.608.8 to a high of $60k or $100k, they could become richer than China and the US combined if they decide to invest in their country like China did.

Ok, I need to repeat this as many times as possible it seems. BTC adoption does not / cannot / will not solve decades of underlying Economic issues. They still spent money while buying BTC, it didn't fall from the sky, so thinking they could become richer than the US and China combined is just false and without systemic fixes to the economy of a country, the political policies, crime, and corruption issues, IMF dependencies as well a dependency on the US dollar, and then jump-starting the economy, that BTC money means jack shit and countries shouldn't latch on to it for a quick fix solution.

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Since September El Salvador have started investing on bitcoin. As a result El Salvador now holds a good number of bitcoin. But there is no expected usage from the common people. As of now El Salvador investment have halved out of the market decline. Some have mentioned El Salvador haven't had any perfect plan and has bought at random occasion. The world is watching the progress and in the long term the holdings will surely support El Salvador uplift it's economy.

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Quote from: ChrisPop on July 18, 2022, 10:16:25 PM

Quote from: Husires on July 14, 2022, 11:21:13 AM

I can understand that El Salvador embraced Bitcoin but their way of investing was so haphazard as if they had never consulted anyone who is an expert in financial analysis or good at reading charts.

I remember that there was a chart of the purchase dates and it all seemed random without a solid economic plan as the price collapsed several times after the purchases.

Currently and historically, the price is ideal for investment, but we did not hear more investments, which reflects the economic situation in that country.

I'm sure that the president has access to councilors in regards to managing the country's finances. But you've got to understand that no one can predict what will happen to the price. You can be the biggest financial advisor in the country, you still don't have a crystal ball in your pocket. Anyways, I don't think the 1771 BTC the country owns represent a significant amount in its treasury.

Anyways El Salvador is not in a 'rosy' situation having 82.6% of GDP in debt. For every $1 of GDP they have to pay around 5 cents just to cover the interest (~5%). In comparison, the United States only pays ~1.6% of GDP in interest expenses.

Bitcoin is unpredictable, it can be said that they are unlucky to buy at higher than current prices and i also believe they have a plan for the current market situation. We are retail investors and we are aware of the volatility of bitcoin, then as president and have a financial advisory board El Salvador will definitely do better than us.

This is an ideal time to buy more bitcoins but given the world situation, I think countries will focus their resources on solving upcoming difficulties rather than investing. Like us, things are very difficult so everyone will limit their investments during this period and will focus on dealing with daily difficulties.

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Quote from: Husires on July 14, 2022, 11:21:13 AM

I can understand that El Salvador embraced Bitcoin but their way of investing was so haphazard as if they had never consulted anyone who is an expert in financial analysis or good at reading charts.

I remember that there was a chart of the purchase dates and it all seemed random without a solid economic plan as the price collapsed several times after the purchases.

Currently and historically, the price is ideal for investment, but we did not hear more investments, which reflects the economic situation in that country.

I'm sure that the president has access to councilors in regards to managing the country's finances. But you've got to understand that no one can predict what will happen to the price. You can be the biggest financial advisor in the country, you still don't have a crystal ball in your pocket. Anyways, I don't think the 1771 BTC the country owns represent a significant amount in its treasury.

Anyways El Salvador is not in a 'rosy' situation having 82.6% of GDP in debt. For every $1 of GDP they have to pay around 5 cents just to cover the interest (~5%). In comparison, the United States only pays ~1.6% of GDP in interest expenses.

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This move was unwelcome by those who don't know what bitcoin is or to those who are anti to it but for the opposite, they are very glad about it. This is not a waste of funds but it was called an investment and I think governments on other countries are also doing the same thing which they also invest some portion of their funds in the hopes of growing it more but maybe not totally in bitcoin and other cryptos but only those on traditional investments like stocks, gold, real estate.

Like others, I also don't think that El Salvador can become richer than china and USA. More if this country is combined because each of them is big already and even without the help of btc, they can still become rich by depending only on their skill.

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Quote from: Majestic-milf on July 14, 2022, 06:40:42 AM

In September, 2021, El Salvador became the first country to adopt Bitcoin as a legal tender; ...//...,,,

Yeah!

Quote from: Majestic-milf on July 14, 2022, 06:40:42 AM

...//...::,,,Take a scenario where BTC skyrockets from it's present price of $19.608.8 to a high of $60k or $100k, they could become richer than China and the US combined if they decide to invest in their country like China did.
...//...::

No...or Nope.

Quote from: Majestic-milf on July 14, 2022, 06:40:42 AM

...//...::,,,
Granted, Chivo is a public ledger, hence the citizens can be aware of transactions and all that. ...//...::

No.

Quote from: Majestic-milf on July 14, 2022, 06:40:42 AM

...//...::,,,
But where I need your opinions is on this: can it be made public enough to scare off monopolists?

As far as it is known, the majority holder of bitcoin is the Government itself and it is known because they have made it public, not because such information is available.

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Let's be realistic that El Salvador's possession of a few thousand bitcoins will not make it a rich country. Also, El Salvador's possession of bitcoin will not give it a magic wand that solves all its economic problems. Yes, it helps in improving the economy and solving economic problems in the long run. This is a new experience and it is natural that many The problems in this experience until things crystallize clearly and everything is put in place, but it is certain that in the long run the adoption of Bitcoin will have a great positive role in improving the economy of El Salvador.
As for anti-monopoly, it is certain that the blockchain helps in this a lot, but it will not prevent it completely because people always find ways to circumvent the laws.

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Chivo is not the public ledger; the Bitcoin blockchain is.

I don't know where you're coming from but, first, the data available in the public blockchain don't include personal data, so while you can see how much Bitcoin an address has, can you trace the identity of the person behind the address? I don't think so. And if somebody has lot of Bitcoin but doesn't want people to know about it, he/she could easily keep them in small amounts in different wallets.

Second, why do you have to scare off monopolists? Bitcoin isn't like an ICO where there's a minimum and maximum amount for sale.

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Its common for investors and finance gurus to recommend a policy of diversification.

Bitcoin is great. But it can be complimented with other crypto. El salvador could fork bitcoin to create their own CBDC. Nodes and miners could be allowed only within the borders of their own country and limited by IP address to prevent outside interference.

Mining is one aspect to bitcoin which made it popular. Finding methods to allow el salvadorans to mine and profit would be a good strategy to fuel mainstream adoption.

Topic: The fear of Bitcoin monopoly in El Salvador (Read 375 times)