Bitcoin Forum

everything follows a similar pattern

there is a bear trap and argentina defaults...


Do you believe this is a Cyprus moment

If Cristina had any balls she could play the whole situation to her favor by robbing the U.S. blind, the U.S. did it hundreds of times.

Actually it's different

Argentina has the money to pay but the payment is blocked by a court order.

Argentina has the money to pay as per the conditions that were agreed upon with 90% of its creditors.

The other 10% now are demanding that Argentina pay according to different rules.

If Argentina accept these new rules, the other 90% could also ask for the same rules, so that's what's causing the problem.

To expand on that, the problem is that the people demanding to be paid are "vultures" who bought up outstanding debts for cents on the dollar (ie after the previous default) and now want to be paid out in full on the debt they bought. They go to court to force the country into paying using the threat of, in this case, default.

Let's hope it is
Could do wonders for btc given that we are talking about a 40mn population and a significantly larger economy than Cyprus

...

@ Sindelar1938

I believe that BTC will do VERY WELL in Argentina, it already carries a huge premium vs. its US price (source: a BTC guy I know who go there a lot, their technorati are very interested in Bitcoin, and its use is growing rapidly).

There are a lot of potential Cyprus situations out there. We just need a spark.

Wishing the demise of a country in crisis so your investment makes money.  That's class ;D

I don't think anyone is hoping for the demise of anyone person or country. The hope is that the Argentinian people adopt an alternative currency and take control away from a bad government.

http://www.youtube.com/watch?v=yc6Hp_Zq3rU

Someone should put this as a bet on betmoose.com ;D

Suggesting Argentina is a Cyprus is a bit of a fallacy.  Cyprus was a offshore bank account and the solution to that theft, among many, was a Bitcoin wallet.  Argentina is just.. Argentina..

If a meltdown occurred in Argentina who will trade their Bitcoin for worthless Pesos?   Even now as we speak, or so I've read, they already pay way above market prices for BTC as there's few suppliers willing to exchange their BTC for Pesos.

Ironically it's the reverse - all the large growth in Bitcoin seems to be opposite where it's people in developing countries looking to acquire $USD.  A lot of Chinese raced to buy Bitcoin, for instance, as a means to get around exchange laws.

Argentina has no surprise factor, everybody if not expect it, know it will happen ...

I agree

fire is a killer, but sometimes what is left behind can grow much better than the generations before...

let the whole rigged system of debt and inflation collapse, and a new system of freedom based on crypto emerge....

Is it still safe for foreigner to travel there?

Argentina, Brazil or Turkey could be the reason of next Bitcoin price jump. Developing countries economics are so bad people try to change their governments. There are huge bans on almost everything in Turkey. People have to use Bitcoin for their financial freedom.

Neo Argentina

The 'different' rules being the ones that Argentina agreed to when it first sold the bonds.
The 10% want what they were promised.

I don't know about Argentina and even less about the prospects in Brazil.

I think Turkey, now you mentioned it, could be a real contender.  Turkey is very well integrated in the international tourism market, has a remittance population in Germany which sends money home and then there are those rules you mentioned.  It was the exchange rules that convinced some Chinese to go big into Bitcoin.

I'm rather excited that now there is supposedly 4000 bank terminals in Ukraine which accept Bitcoin but the problem is I don't want to vacation in a country and have my hotel or hostel get blown up by a ballistic missile.  

Article on vulture funds here is Australia.

http://www.smh.com.au/world/us-vulture-fund-forces-debt-default-by-argentina-20140731-zyy83.html

no its not... its a total different story

I really do hope that Bitcoin grows in Argentina but this is different than Cyprus. Argentina has had many instances of hyper inflation and their citizens are already heavily adapted to investing in USD fiat to hedge against the peso. another Crysis will promote the adoption of Bitcoin but I doubt their will a mass flood of new users overnight. Than again if only 1% of the Argentinian population of 42.6million starts investing and using Bitcoin that can indeed cause a bubble.

Imagine 43k new bitcoin users hitting the exchanges overnight, damn ...

None of which changes what I said. The 10% want the original terms of the bargain Argentina agreed to.

Argentina is not the Cyprus of 2014. It's an entirely different situation and there is much less contagion risk for other countries. the default was expected to occur sooner or later.

The Cyprus of 2014 could happen in Portugal and Spain. These would be catastrophic events.

ya.ya.yo!

Yeah, it seems to be a completely different situation. I don't think this particular crisis could have the same obvious upside for BTC that the Cyprus crisis had.

Is their any evidence that the people of Cyprus where heavily investing in Bitcoin? I believe the March 2013 bubble was only indirectly supported by the Crisis in Cyprus due to media attention given to bitcoin.

Indeed, there is no evidence. I'd also agree that it was media attention that pushed the prices up.

I do not want to imply by discussing a possible Cyprus 2.0 scenario that this would be positive for the bitcoin/fiat exchange rate. It might have a positive influence if media portray bitcoin as a possibility for capital flight. We have to wait and see what happens.

ya.ya.yo!

Do you think things would have gone differently if they had won the World Cup? I mean, there's a lot of money involved with those things! They could've used it to pay for the country's debts.

True, for instance I already owned some bitcoins when Cyprus' economy started to collapse, and this just prompted me to buy more.

http://static.fjcdn.com/pictures/Srsly_530ff6_429093.jpg

weird how the rally just started this morning.

You got me, there :D Don't believe it either, but let's see if some people jump on that train. The whole World Cup madness was pretty wild and seemingly important for a lot of people!

it would be 430k new btc users right.

In what sense?

About bitcoin adoption, or about they being a small economy that will lead to a global crysis, like happened with Cyprus and Greece crysis spreading to Euro zone, then to the world?


I don't think the Argentina's crysis will spread to the world, because everyone knows that they are not a solid economy, so are kind of prepared for them falling, and they are not part of any significant economic block.

Either I doubt they will become a bitcoin enthusiast land because their ideology is close to the chinese one, and also close to countries not  bitcoin friendly, like Bolivia and Ecuador. The most optimistic situation is they just have no regulations about bitcoin.

Technically, the 10% are not the same people anymore. So Argentina never promised anything to the current 10% that are holding these credits.

Wow!!!

There are people in Buenos Aires selling bitcoin for ~8150 ARS or $1000!!!

They un-pegged their currency and had bank holiday the last time they defaulted. The county population suddenly lose a lot of wealth over night.


It wouldn't surprise me if they confiscate bank account balance this time.

No, I don't think that Argentina is the Cyprus of 2014?
Cyprus had difficulties due to the World crisis a few years ago.
Current crisis in Argentina have roots in first bankruptcy of this country 10 years ago.
So cause for this country is entirely different, not connected with the current economic crisis in the world but because of their national debts and inability to pay it.

$1000 if you use the government exchange rate.

they are trading using the black market rate, which is the true dollar value.

Yeah.  If you are trading bitcoin for pesos, you have to have a nearly immediate use for a lot of pesos or you will likely be stuck holding the bag.  Inflation is already high, but if it goes up from 30%+, you need some type of hard asset.  Or you'll be stuck if the peso crashes more than it has due to default and other mismanagement.

No, it doesn't change what you said at all.

But these 'vulture funds' only purchased the debt after the default. I consider it a pretty ordinary way to make money.

This is basically another way to measure what the true Peso/USD rate is as opposed to the Peso/BTC o the USD/BTC rate. Argentina has very strict capital controls so it is difficult to move money out of the country.

Normally, foreigner are allowed to carry around 10k USD in and out without problem. If the black market rate gives 30% premium, it might worth your while to enjoy your vacation there.

The main difference is that Argentina has its own fiat money. But...the people in Argentina have some money in dollar accounts that may be confiscated. The peso accounts are better robbed by inflation.

Wow, is it really that bad already?!

That does not sound fun at all. I hope enough people there hear about Bitcoin before it's too late.

That's what exactly i did.  It is a great place for foreigners.  You can bring your dollars, trade them in the black market for a premium and go to high end retail brands and buy gold watches and jewelry for a fraction of the cost.

The haircut being done in Cyprus is to confiscate a part of depositor money.

Argentina can either do the same or let the the peso depreciate by same percentage to achieve the same goal.

That's an interesting question after Zeroday made his post of the treatment he received from the Cyrpus banks that confiscated his banking accounts and employees pay and went to Bitcoin a rally occurred. So it is possible a similar story could emerge from Argentina that could act as a trigger.

Good question and it is possible that could happen.

Argentina is likely going to allow the peso depreciate further. They really do not have many issues with their banks so it is unlikely that banks will concatenate part of depositors deposits. Argentina also has it's own currency, verses  Cyprus using the Euro so they can print as much money as they need.

I think that people across Europe were buying bitcoin when Cyrpess hit as banks across Europe were having problems and were probably afraid that the same thing could happen in Spain for example.

I think some people are buying bitcoin in Argentina to avoid massive inflation of their Pesos, but I do not think it will have as large of an impact as Cypress did.

Real estate and gold are a better hedge against default risk than bitcoin.

I agree, the media interpreted that that bubble was because of Cyprus, I tend to believe that was the first block halve and the ASICs race start.

This.

The black market rate is the so called "Blue Dollar" (actually is called blue, not azul in spanish), the rate is now 12,7 ARS/USD. The official rate is 8,2 ARS/USD. More than 50% diff.

Bitcoin is priced around bitstamp value at blue dollar rate.

Price reference. http://www.ambito.com/economia/mercados/monedas/dolar/


I guess the inflation is already 30%+.

Xapo. https://xapo.com/en/

Will become very popular in Argentina. The founder is also very familiar with Argentina's banking and financial problem.

I'm sure hope Xapo has a marketing campaign in South America.

Why Argentina’s Debt Default is an Opportunity for Bitcoin

http://www.coindesk.com/argentinas-debt-default-good-bitcoin/

I think this will cause bitcoin appreciate over the near term. With the citizens of Argentina wanting to avoid inflation, they will purchase a deflationary asset, in other words bitcoin. 

This is about Argentina defaulting on its bonds.  Bonds are denominated in USD so they can't print pesos to get out of mess.   Not comparable to Cyprus situation.  Cypriots bought bitcoin because imposed bank holiday

Stop thinking everything is good for bitcoin.  LOL  ::)

If Argentinians could buy USD, they would.
Depends on whether BTC is easier to lay hands on, or USD.
In the end, it could be good for bitcoin.

Did you read the story?   Agentina is defaulting on some bonds.   What does this have to go people converting their currency

Because there will now be hyperinflation of the Argentina Peso > 30% this year, meaning a big loss for holders of pesos. Thus it is advantageous for them to convert their money into a currency that will not inflate as greatly, such as the USD or possibly bitcoin.

They are actually being forced to default on all of their bonds, just some of them have interest payments that are now past due. When a country defaults, the world in general (including it's citizens) will lose faith in that country's economy and currency.

The link is Argentina defaults --> Harder to get external credit --> More printing of pesos --> High Inflation.
In the end, people will have to look after themselves, if their pesos get devalued very quickly.

The bonds are denominated in USD though.   Plus they're already having inflation problems.   Why would they print more pesos?   If anything they'll go back to pegging their currency or they'll go to IMF and be forced to follow whatever IMF reccomends

For regular Argentinian people I think they have already been buying USD but the govt placed  limitation in Jan.

I'm gonna ask my Argentinian friend about it.   I don't think in times of crisis most people will suddenly start speculating.   I think they seek stability

One could argue that keeping the peso while knowing that inflation may or may not occur, is in itself speculation. Moving to USD, Gold, Bitcoin or w/e else, could be a move to improve stability. Gold and USD buying has tight restrictions, but they may be able to get Bitcoins.

Because they need money for government spending, and they will be covering those expenditures with printing pesos. Government employees, social programs will be funded with this devalued peso. The same amount of peso will be buying less and less goods and services with each passing day. Basically, the same thing every country is doing more or less :)

They need to cut government expenditure and let the private industry develop the country.

If the politicians all over the world see the need to rein in government expenditure, half the problems in the world will be solved.  ;D

This does work somewhat however the more pesos that are printed the less effective this becomes as this would cause a sell off in pesos.

I seriously doubt that the IMF will bail out Argentina as they are really too big of a country for the IMF to lend to. The IMF usually lends to countries with very small economies that never had access to capital markets while Argentina has had access to the capital markets.

Printing more ARS wont pay off USD denominated debts.   They have to acquire USD from somewhere.   Is Argentina bigger than S Korea in 1997?  IMF actually proposed a restructuring in 2003 but plan was abandoned due to pressures from USA

Argentina could print pesos to buy dollars to pay back their debts. As they sell more pesos, the value of each peso would decrease so the more they print the less dollars they can buy on a per peso basis.

It doesn't work like that.   

Now that I've researched the story in more detail.   Its not that Argentina can't pay,  they refused to pay some vulture funds and they got sued in US courts.   The judges ruling forced them to miss bond payment and thats why credit rating was rated as default

But their money is still a mess

No country has managed to mint its way out of a crisis.

I agree.  Monetary policy alone cannot solve economic problems

Yep minting is never the solution to a financial crisis usually its development of the countries industries and diversifying the cash flow
The other way is infrastructure spending.
Hard to do when a country is in default though.

But printing more of something worthless would just make it worth less (har har)
Think the Zimbabwae Dollar or the Weimar republic as some examples.

Develop the country's industries, make sure the fiscal deficit is under control..... You will automatically attract capital.

Just opening up the country and border will attract foreign capital. Undeveloped land will be bought up and develop by transnational companies and local labor/population will benefit from it.

everything looks  similiar .
im really curios to know and understand about that :D

The only worry is the gates can't be closed after that.
If the US begins to look more attractive, capital could rush out.
And that could lead to a lot more economic devastation. :)

You don't have to wait for long. Things will play out in the next couple of months.

The difference is that Argentina will likely be contained just in Argentina, while the problem in cypress could have easily spread throughout europe.

I wish we could be sure of that. :)
http://www.ftadviser.com/2014/08/07/funds-and-data/default-may-expose-global-vulnerability-CxMS2BGjtw5aoL2r1p1btI/article.html

May be they shoud try with cryptocurrencies. :D

Good one. Just need to mint something to convince other it is better than bitcoin.

Instant profit.

Every country has its way of managing its own crisis in all aspect so i don't think thats possible.

I don't think this would be possible. You cannot "mint" cryptos out of thing air. You must first make an investment (buy an ASIC(s)). If you are referring to them creating some kind of altcoin with coins premined then this would also make no sense as it would be unlikely that there would be any kind of demand for this (there is little demand for most alts).

Even if they do come out with altcoins, its credibility would be linked to the Argentinian government. You would probably see hyperinflation in these altcoins too. ;)

8,000 Convenience Stores in Argentina Now Sell Bitcoin

http://www.coindesk.com/bitpagos-brings-bitcoin-8000-convenience-stores-ripio/ (http://www.coindesk.com/bitpagos-brings-bitcoin-8000-convenience-stores-ripio/)

First, all FIAT money is full premine. Second, this alt could be backed by the stated, and that can make it quite popular.

I think that most altcoins experience hyperinflation as more people realize that they cannot offer any thing of value so people sell the coins. This results in the price of the altcoin more or less crashing.

Altcoins have no value to begin with. This is just the dump phase rather than "hyperinflation".

As you can see in Coinmap, in Argentina we have a lot of business which accepts bitcoins, 148 vs 154 from the other country in south america together


http://i.gyazo.com/8798c2f9c64b69d15c58314829622e45.png


also we have some e-business like bitpagos, digicoins, http://enbitcoins.com (where you can pay taxes and services with bitcoin), two exchange (unisend and satoshitango)



on the other hand, we are near 40.000.000 inhabitants, so we still have a long road...



we have a new "revolutionary moventent".... LaSatoshi when we do a little publicity, it's a half joke, a half seriuos

 https://www.facebook.com/lasatoshi?fref=ts

https://scontent-b-mia.xx.fbcdn.net/hphotos-xpf1/t1.0-9/q81/s720x720/10401460_546657108802250_6996450028235482916_n.jpg

https://scontent-b-mia.xx.fbcdn.net/hphotos-xap1/v/t1.0-9/p180x540/10481690_10204519779253859_6475259086312470582_n.jpg?oh=5676711e3d78fb2f8e039e4edcaa3503&oe=546DFE1A

They get their value from the speculators in the market, instead of from the security of the network (miners) as what happens with bitcoin.

I think Turkey, now you mentioned it, could be a real contender.  Turkey is very well integrated in the international tourism market, has a remittance population in Germany which sends money home and then there are those rules you mentioned.  It was the exchange rules that convinced some Chinese to go big into Bitcoin.

I'm rather excited that now there is supposedly 4000 bank terminals in Ukraine which accept Bitcoin but the problem is I don't want to vacation in a country and have my hotel or hostel get blown up by a ballistic missile. 

Crying for Argentina


https://www.youtube.com/watch?v=ya3Dh1K2qvA (https://www.youtube.com/watch?v=ya3Dh1K2qvA)

There are a lot of countries which seem to be 'ripe' for discovering bitcoin.

If the national currency is unpopular in a country then why would an atlcoin that is backed by the same country do any better? An altcoin as you describe would have less benefits and more drawbacks then a fiat based currency based by a specific country. The main difference is that an altcoin based currency would be subject to attacks on the network while a fiat based currency would not.

Cristina Hitchens is a massive delusional spastic that doesn't get you can't defy the status quo without a more solid plan than saying "we are not paying that debt" then expecting things to not get royalty fucked up.

Just trying to get the vulture investors to back down.