Tonga will probably be the next country to make Bitcoin legal tender - page 5.

Lucius

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If we take into account the political support that Bitcoin had in El Salvador, and compare it with Tonga - then it is a huge difference, because this is a member of parliament who has a proposal that is completely unknown how it will be accepted by parliament, government and all who should agree with that proposal. What's interesting is that Strike is included in the story again, and that Bitcoin can become a way to transfer money even if Bitcoin is not a legal tender.

Quote

Strike enables residents of this nation to send money transactions practically for free through the Lighting Network. Thus, broad adoption of the app can be a tremendous benefit to Tonga’s economic development. Additionally, Strike may not need the government or central bank of Tonga’s permission. This is a purely business arrangement.

Hydrogen

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I wonder what the economic impact of investors and finance demographics immigrating from the united states to the carribean, puerto rico and regions with more crypto friendly regulation is.

What is the opposite of capital flight? I think el salvador might have a clue on this. Smaller nations like tonga may not. It would be very interesting to know what percentage of residents are aware of the western union fees they pay in contrast to fees, the rest of the world. Or even fees bitcoin users might expect to pay.

Around 2007, I visited an island which mostly lacked internet support. There was an internet cafe there which charged $60 an hour to use the internet. Tonga's native internet infrastructure could be better or worse than this precedent.

Quote from: Darker45 on December 07, 2021, 11:50:50 PM

Pending the passing of the law that will hopefully make Bitcoin a legal tender of the beautiful yet isolated kingdom of Tonga, why doesn't the government just declare Bitcoin as an acceptable currency? I guess a mere executive order or something like that would be enough to make the ball rolling for this tiny country.

To answer that, it may help to remember the era from 2016 to 2020 when Donald Trump was called a dictator due to him issuing executive orders.

Apparently, that type of behavior is... what dictators do? Huh

Is that how it works?

kryptqnick

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Given that the article is based on thoughts of one Tonga MP, I think it's not particularly likely that they'll make Bitcoin legal tender there. I looked up the information about their economy, and it's not doing well, so they might consider taking a risk, similarly to what El Salvador did, but there we saw a strong hand of a young dictator (president), whereas here it's only words of an MP for now. Also, Internet penetration is at 40% there, which seems lower than in El Salvador which has around 50% penetration. Maybe it's not a huge difference, but the majority not having internet access sounds problematic for adoption of Bitcoin to me.

nullama

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Quote from: Darker45 on December 07, 2021, 11:50:50 PM

Pending the passing of the law that will hopefully make Bitcoin a legal tender of the beautiful yet isolated kingdom of Tonga, why doesn't the government just declare Bitcoin as an acceptable currency? I guess a mere executive order or something like that would be enough to make the ball rolling for this tiny country.

I think this Bitcoin-as-a-legal-tender experiment would be much easier to manage and probably faster to earn success in this very small Polynesian island nation than in El Salvador considering that Tonga is very small both in area and population.

The biggest challenge, however, would be technological and basic infrastructures that would provide the population reliable electricity and internet connection as well as the access to smart phones. This is particularly more challenging because the country is archipelagic and that a number of small inhabited islands are living off the grid.

That's a good point.

In 2019 Tonga didn't have Internet access for a couple of weeks because one underwater cable was damaged. On the positive side, that same year the government started to prepare a satellite internet connection to provide internet access to most of the islands of the kingdom.

Also something to note, even though there are hundreds of islands in Tonga, about 70% of the population live on the main island.

Darker45

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Pending the passing of the law that will hopefully make Bitcoin a legal tender of the beautiful yet isolated kingdom of Tonga, why doesn't the government just declare Bitcoin as an acceptable currency? I guess a mere executive order or something like that would be enough to make the ball rolling for this tiny country.

I think this Bitcoin-as-a-legal-tender experiment would be much easier to manage and probably faster to earn success in this very small Polynesian island nation than in El Salvador considering that Tonga is very small both in area and population.

The biggest challenge, however, would be technological and basic infrastructures that would provide the population reliable electricity and internet connection as well as the access to smart phones. This is particularly more challenging because the country is archipelagic and that a number of small inhabited islands are living off the grid.

nullama

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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.

Topic: Tonga will probably be the next country to make Bitcoin legal tender - page 5. (Read 705 times)