Tonga will probably be the next country to make Bitcoin legal tender - page 3.

Kyraishi

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"Given bitcoin’s high price volatility, its use as a legal tender entails significant risks to consumer protection, financial integrity, and financial stability. Its use also gives rise to fiscal contingent liabilities. Because of those risks, bitcoin should not be used as a legal tender."

Utter bullshit.

The arguments are completely nonsensical. How does volatility have to do with BTC's ability to be legal tender?

It's all a matter of what the mainstream perception of BTC is. If a lot of people denominate their purchases in BTC as a native asset, then there will be no issues with volatility.

DrBeer

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The question is - haven't you all noticed one interesting trend? Only those countries where, to put it mildly, a low standard of living, not a very successful / skillful / adequate government, are "introducing the official means of payment" cryptocurrency "100%? You will not find a single country with a functioning economy, local currency, industry or manufacturing in the news. And what is important - they, those who introduce cryptocurrency as a means of payment, do not understand that this is not a solution, this is an attempt to use the hype and "fashion trend", to give a "solution to all problems" type.

Sithara007

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Quote from: cryptomaniac_xxx on December 25, 2021, 10:50:03 AM

Well you might be right, if governments around the world will really have to look at better options right now to hedge against inflation, then bitcoin will be the best choice as opposed to gold. But the problem is that they are really afraid of bitcoin and definitely because of what they heard and it's volatility. So for me it might take more time, like 10 years to allow it to slowly sip and make a progress. Government in Asia and Latin and Central America might be the first one to make a move like what El Salvador did this year.

Volatility is definitely an issue with cryptocurrencies (including Bitcoin). But look at the investment from the government of El Salvador. In the end, it benefitted them greatly. The investment in cryptocurrency can never be compared to forex reserves. Rather, it should be compared to the Sovereign Wealth Funds (SWFs). Most of the SWFs are comprised of volatile assets such as stocks and mutual funds. And I don't think that Bitcoin is anymore volatile than mid-cap and small-cap stocks at this moment.

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Quote from: Sithara007 on December 25, 2021, 03:35:22 AM

Getting the first 2-3 countries on board is going to be the toughest task. El Salvador has already made Bitcoin the legal tender and a few other countries may do so in 2022. Personally I wasn't expecting this much progress before 2024-25. The multi-trillion dollar stimulus measures announced by the US government has horrified a lot of people, both within the States and outside. They are now seriously thinking about a currency which is protected against inflation and Bitcoin is the best choice right now (especially since gold is performing poorly).

I also wouldn't be too surprised if in 2022 there will be other countries following in El Salvador's footsteps. This has definitely been a well-thought-out plan. Let's wait and see which country will first announce the adoption of Bitcoin in 2022.
There will be a country that will reflect on the achievements of El Salvador, strictly speaking here El Salvador must really show a positive output.

cryptomaniac_xxx

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Quote from: Sithara007 on December 25, 2021, 03:35:22 AM

Getting the first 2-3 countries on board is going to be the toughest task. El Salvador has already made Bitcoin the legal tender and a few other countries may do so in 2022. Personally I wasn't expecting this much progress before 2024-25. The multi-trillion dollar stimulus measures announced by the US government has horrified a lot of people, both within the States and outside. They are now seriously thinking about a currency which is protected against inflation and Bitcoin is the best choice right now (especially since gold is performing poorly).

Well you might be right, if governments around the world will really have to look at better options right now to hedge against inflation, then bitcoin will be the best choice as opposed to gold. But the problem is that they are really afraid of bitcoin and definitely because of what they heard and it's volatility. So for me it might take more time, like 10 years to allow it to slowly sip and make a progress. Government in Asia and Latin and Central America might be the first one to make a move like what El Salvador did this year.

Fortify

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Quote from: nullama on December 07, 2021, 10:24:21 PM

It has been 3 months since El Salvador made history by making Bitcoin legal tender in their country, alongside the USD(September 7th, 2021).

The world has reacted in different ways. For example, the International Monetary Fund (IMF) has recommended El Salvador to not use Bitcoin as a legal tender:

Quote from: The IMF

"Given bitcoin’s high price volatility, its use as a legal tender entails significant risks to consumer protection, financial integrity, and financial stability. Its use also gives rise to fiscal contingent liabilities. Because of those risks, bitcoin should not be used as a legal tender."

Other countries are starting to think about making the same move that El Salvador just did, such as Paraguay, and many others. The main motivations behind this are high fees of remittances, increasing inflation, and not having access to traditional banks. After reading a bit more in detail about the actual situation in each country I realized some countries are not really putting any actual laws into parliament, others are considering using different cryptos, etc. I think Tonga is probably the closest to actually achieve Bitcoin as a legal tender:

"Tonga’s Parliamentary Representative Wants Bitcoin To Become Legal Tender"

People in this small island use Western Union for remittances, and they have to pay up to 30% in fees. Making Bitcoin legal tender, alongside the Tongan Pa’anga, would immediately help people save a lot in money transfers. MP Lord Fusitu’a will be presenting a Bitcoin bill, similar to the one from El Salvador, to the Parliament of the Kingdom of Tonga by May 2022. We will have to wait and see if it passes.

People need to be very careful about the underlying reasons that drive this sort of activity. While it has a commendable undertone - he claims western union costs 30-50% in fees (this seems ridiculously high?) I just wonder what their banking companies are charging to make Western Union the money exchanger of choice? Do they not have a single commercial bank that can offer much more favorable rates? It would seem like a much easier and straight forward action to get the government to force the rates of these companies down to a much fairer level rather than forcing companies to accept a whole new currency. I always wonder how financially invested these particular MP's are in Bitcoin when they start going this route, because it could help make them very rich if it boosts the price a little.

Sithara007

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Getting the first 2-3 countries on board is going to be the toughest task. El Salvador has already made Bitcoin the legal tender and a few other countries may do so in 2022. Personally I wasn't expecting this much progress before 2024-25. The multi-trillion dollar stimulus measures announced by the US government has horrified a lot of people, both within the States and outside. They are now seriously thinking about a currency which is protected against inflation and Bitcoin is the best choice right now (especially since gold is performing poorly).

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Quote from: Lucius on December 18, 2021, 11:49:22 AM

Quote from: paxmao on December 16, 2021, 08:01:20 PM

I am not really familiar with Tonga... what the heck... is there anyone here familiar with Tonga?

You will hardly find anyone on the forum who has anything to do with Tonga, because it is a fairly isolated group of islands located in Polynesia, some would say in the middle of nowhere. According to the 2016 census, they have just over 100 000 inhabitants, and some estimates say there are at least as many abroad, mostly in the US, Australia, and New Zealand.

When we compare this to El Salvador which has over 6 million inhabitants, then the influence of Tonga even if they accept Bitcoin as a legal tender would be only symbolic.

And while this is symbolic for us it would not for the people of Tonga, if this comes to happen and bitcoin becomes a legal tender there and people can send and receive money with bitcoin for much lesser fees then there will be a direct positive impact on their lives, showing once again that all of those that criticize bitcoin as just another tool to speculate are mistaken, bitcoin has use cases and this is clearly one of them.

Lucius

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Quote from: paxmao on December 16, 2021, 08:01:20 PM

I am not really familiar with Tonga... what the heck... is there anyone here familiar with Tonga?

You will hardly find anyone on the forum who has anything to do with Tonga, because it is a fairly isolated group of islands located in Polynesia, some would say in the middle of nowhere. According to the 2016 census, they have just over 100 000 inhabitants, and some estimates say there are at least as many abroad, mostly in the US, Australia, and New Zealand.

When we compare this to El Salvador which has over 6 million inhabitants, then the influence of Tonga even if they accept Bitcoin as a legal tender would be only symbolic.

paxmao

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I am not really familiar with Tonga... what the heck... is there anyone here familiar with Tonga? But I do applaud those countries that are willing to accept bitcoin as legal tender. I think they are making a good bet for the future. However, that is only as long as they are also able to keep their local coins. Bitcoin is, till now, deflationary and that is a very poor characteristic for a countries' coin as it does not allow to use any monetary policy when the situation calls for it.

Tonga seem a bit beyond that, so it is ok.

Quote

claims that Western Union “takes a 30 per cent commission”

... such a clear use case.

adzino

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Quote from: mu_enrico on December 09, 2021, 11:54:58 AM

Legal tender means people MUST pay with Bitcoin, and that I disagree. I agree with a simple law that states people can freely use Bitcoin as cash or whatever means of payment. People should be free to use what currency they want to use or reject, but that's only exists in an imaginary country... Well, I'd like to see what the law really said before making further comment.

No, it doesn't mean that they MUST pay with bitcoin. They also have fiat currency which is also a legal tender. So it means they can also pay with fiat money. But this means that they receiver must accept bitcoin or fiat money because both are legal tender. But I don't see any issue over here. There are many gateway payment processor that will instantly convert the bitcoin to receive to fiat currency of your choice. The fees are also very reasonable (all POS also have fees, but customers aren't charged by the sellers) and easy to setup. Good to see more countries wiling to turn bitcoin into a legal tender.

Leonardo7

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30%in fees is an indirect robbery. I magine 30% of $1,000,000 that would be $300k I undersatnd there should be a cap though and it's still way too expensive. My brother in Italy sends money to me via crypto almost at no cost. This is what the banks fear. The days of visiting their iniquidity is near.

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Quote from: Slow death on December 12, 2021, 04:31:32 PM

the only impact that tonga would have if they agreed to use bitcoin as the main currency in the country would be that all the news channels would be talking about it, the small number of people who have tonga is something that would not affect the price, i say this because not everyone would buy bitcoin and also have a question to see what is the purchasing power of each person in Tonga

Well not everything should revolve around whether a news is going to have a positive effect on the price of bitcoin, this is just about adoption, the people of Tonga need something like bitcoin, paying 30% on fees is simply not acceptable, Western Union and other remittance services charge huge fees all over the world when bitcoin offers the same service at ridiculous low prices, so it makes sense for the government of Tonga to be interested in integrating bitcoin to their small economy as it will bring to them huge benefits almost immediately.

Tumanggor

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what a happy feeling to hear one more country that Bitcoin will save

bitcoin has made el salvador a strong and independent country, surely Tonga will be like el salvador if tonga follow in el salvador footsteps

in 2022 I really believe there will be more and more small countries that make bitcoin as a legal tender in their country

oHnK

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Quote from: Poker Player on December 13, 2021, 04:39:17 AM

At least I'm not as excited as the OP seems to be. Even if in the end what the MP proposes was approved, we are talking about a set of small islands in the middle of the ocean, far from everything basically.

Although I welcome any country that wants to pass Bitcoin friendly regulation. It is likely that little by little it will be this kind of countries, and not the big ones with strong currencies, that will do it.

Whatever it is, the point is to think of all of this as a form of adding information and knowledge because this will not have a significant effect on the market. There is no one big country that will make Bitcoin a legal tender in their country because it will threaten the existence of their own country's fiat. How can fiat coexist with BTC with contradictory characteristics? This is like a joke in broad daylight but still has the potential to happen if there are extreme leaders in their policies.

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Never heard of this country op. I understand why you are assuming that Tonga will accept BTC as legal tender due to financial difficulties, but you need to remember the fact that most of these proposals get rejected by their respective governments.

Why? Because cryptocurrencies like BTC, ETH etc basically take away some of the power from the government and shift it to the common people which is why most government officials hate them and oppose them ardently.

Cases like El Salvador accepting BTC as legal tender are rare to be honest.

Kakmakr

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Well, the president of El Salvador said that the main reason why they started to accept Bitcoin as legal tender, was for remittance purposes. The Money transmitters are making a killing by charging people crazy high fees and that is not helping these citizens. (Most of them are working in other countries and sending money home to their kids and family)

It will also open new tourism opportunities for "Bitcoin" tourists...because some people earn bitcoins and they cannot spend it in their own countries. They then go on Bitcoin holidays in countries where they can spend it. Grin

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Quote from: davis196 on December 13, 2021, 03:47:49 AM

1.This seems like another clickbait article.Bitcoin still hasn't been accepted as legal tender in Tonga.There's a proposal in the parliament,but that proposal might be denied.

How is something clickbait if the title says "Tonga will probably be the next country to make Bitcoin legal tender"? This means that there is a possibility that this will happen, although the situation is not even close to what happened in El Salvador. A member of parliament who proposes this law may have feedback from other members of parliament who are prone to a positive decision, but we will not find out until the final decision.

Yet whichever country is next, it is more important that someone follows the example of the first country and shows that this was no exception.

michellee

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IMF can recommend El Salvador not to use bitcoin for legal tender but that will be to their government because they know what the real thing that happens to their country. If El Salvador can manage the risk of bitcoin price volatility and know how to benefit them, the IMF can not do anything.

If Tonga finally uses bitcoin as Legal Tender, it will give more support for bitcoin to become globally in a short time because more countries will see the potential of bitcoin for their country and their people.

People do not want to pay up to 30% in fees by using Western Union because that can save their money for another thing and maybe that country will develop better in the future. Hopefully, that plan can do smoothly so bitcoin can be accepted as a legal tender in Tonga.

Poker Player

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Quote from: davis196 on December 13, 2021, 03:47:49 AM

1.This seems like another clickbait article.Bitcoin still hasn't been accepted as legal tender in Tonga.There's a proposal in the parliament,but that proposal might be denied.

Yes. The title given to the thread by the OP is quite clickbait, as it is based on the initiative of an MP.

I'm not too excited about the news myself, at least I'm not as excited as the OP seems to be. Even if in the end what the MP proposes was approved, we are talking about a set of small islands in the middle of the ocean, far from everything basically.

Although I welcome any country that wants to pass Bitcoin friendly regulation. It is likely that little by little it will be this kind of countries, and not the big ones with strong currencies, that will do it.

Topic: Tonga will probably be the next country to make Bitcoin legal tender - page 3. (Read 705 times)