El Salvador has become the first country to make #Bitcoin legal tender! 🇸🇻

[Wiwo]

Great.

I am glad that you did not take my response/suggestion personally.  

For anyone to really attempt to communicate better in regards to bitcoin, then it is better to try to use the term bitcoin when referring to bitcoin and surely sometimes there might be a need or preference to use the term crypto, also..  and frequently if you are trying to use the term bitcoin whenever you are referring to bitcoin, then for sure, your writing will become more clear (and maybe even your thinking about the topic will become more clear too?) and even your use of the term crypto (when you do decide to use such term) will be more likely to be better understood and within a better context too.

For me I don't think anyone that wants to grow in this industry would take any good advice personal. You corrected my post few months ago I was dumbfounded.The manner my post was analysed and each of my errors discussed extensively made me fret. At a point I was ashamed but I summoned courage and reread my post and your comments and I was really enlightened. I have specifically learnt never to compare or generalize Bitcoin with other shitcoins. Doing that is a grave offence. Most of us have learnt and will keep learning from you because your corrections are detailed and enlightening. Even though sometimes it bites, but at the end its rewarding.  

@JayJuanGee is a great contributor on this forum with in-depth knowledge on industry matters, I have learned a lot from his corrections also both on this thread and from the general forum contributions we can never be ashamed to pick corrections rather we learn and grow from them.
Back to the topic of discussion
El Salvador has taken a courageous step as the pioneer country in Bitcoin legalization and this step has placed the El Salvador President in the limelight and the challenges being faced with Bitcoin adoption by the country which is expected to happen in any new revolution that will have a long-lasting impact on the general public and the economy at large. Banking the unbanked is one of the biggest advantages of El Salvador's Bitcoin adoption and this is at the center stage.

[1714908807]

1714908807

[1714908807]

1714908807

[1714908807]

1714908807

[1714908807]

1714908807

[1714908807]

1714908807

[jokers10]

...
Banking the unbanked is one of the biggest advantages of El Salvador's Bitcoin adoption and this is at the center stage.

And what is IMO most exciting in that is that there is even no need of a 100% coverage of bitcoin usage, having a real alternative already gives many opportunities: when bank system sees a real competitor it  starts to put more effort into retaining and attracting of customers. So some of Salvadorians will get better bank service even if they will not learn crypto at all as banks will fight to not to lose them as a customers.

[Doan9269]

I would not say that they lag the interest about bitcoin as most of the population needs to understand the basic levels of information about it not going into too details about technical working

let's not give personal or technicality issue room into this as a reason for the El-Savadoran adoption of bitcoin, this is government we are talking about and they have the final verdict, in the case of Bukele he did not mandate everyone to use it but optional instead, now let's consider that as the government accepted bitcoin as a legal tender in El-Savador which automatically means that their banks could as well perform bitcoin transaction, and here the citizens were no more in doubt about what bitcoin is and how they can use it as a currency, i think what needed to be clear here is that the people only need little more time to get acquainted with bitcoin for payment or investment asset as the case maybe.

Another instance is when government want to issue a newly developed project to the people, we all know it requires time for such to be fully circulated and for some citizen to really clear their doubts about it, again another good example here is the covid vaccines, till date we have many people yet to get it, the more it lingers the more new generations were birth and are coming up that will still requires it, same is the bitcoin adoption in El-Savador, quite alright everyone is aware of it but before it can be fully utilized to a reasonable extent beyond doubt requires time, i am yet to see a protest or any expression of displeasure in it by El-Savadoran.

[jokers10]

...
i am yet to see a protest or any expression of displeasure in it by El-Savadoran.

We can divide all protests caused with bitcoin adoption in El Salvador into two groups: the first are based on having not enough knowledge about bitcoin, about crypto, about how it works in El Salvador in practice; the second is based on problems with Chivo wallet. There were several problems with it's usage and there are some doubts in it as it is centralized and is not open source. Of course problems can be solved, but to do it we should not say that there are no problems at all.

[Doan9269]

We can divide all protests caused with bitcoin adoption in El Salvador into two groups: the first are based on having not enough knowledge about bitcoin

of course we can't expect all the citizens of El-Savador to have the full knowledge about bitcoin at the same time, this is a new system introduced and it has to take a little while for them to het used to it, fine and good they complained inexperience in the use of bitcoin which is a normal thing we all can find challenging when a nee system is introduced but we must not forget that Bukele did not force anyone to use it and their complaints here is not in display of  total rejection for the use of bitcoin but rather the "lack of the technical know how".

the second is based on problems with Chivo wallet. There were several problems with it's usage and there are some doubts in it as it is centralized and is not open source

base on my conviction I don't see any reason why chivo wallet being centralized should be a challenging factor in a country that adopts bitcoin as a legal tender, it will rather do more good to help those you mentioned that complained their inability to know how to engage the use of bitcoin, if you have the experience about bitcoin as an El-Savadoran and uses chivo wallet then i don't see anything bad if you want to secure more privacy by using an open source wallet along the line, we can't expect the entire citizens to go all decentralized, that will give a serious complications at first, scam rate and many other loss of digital asset will be lost, remember you're dealing with the whole populace of El-Savador.

[stomachgrowls]

...
i am yet to see a protest or any expression of displeasure in it by El-Savadoran.

We can divide all protests caused with bitcoin adoption in El Salvador into two groups: the first are based on having not enough knowledge about bitcoin, about crypto, about how it works in El Salvador in practice; the second is based on problems with Chivo wallet. There were several problems with it's usage and there are some doubts in it as it is centralized and is not open source. Of course problems can be solved, but to do it we should not say that there are no problems at all.

Bit on a rush on making it as a legal tender? Yeah, sort of.. Whenever there are some decisions or conditions about making it as a legal tender or regulating it then it would really be ideal if it was explained

well into its citizens so that you could really able to have that effective adoption in terms of utility and other opportunities which might result into positive impressions not or unlike now

that citizens or people on El Salvador do really find out to be not that relevant or not much needed which is totally opposing on overall idea.

[Vaskiy]

Last year during the June month El Salvador President Nayib Bukele announced that he will send the bill to make bitcoin legal tender within the country. One year passed and during the same time period the announcement have been implemented during the month of September. Following the same El Salvador government started to accumulate more volume of bitcoin. As a result now El Salvador have got 2301BTC in its reserve. The $100million spending have come down to $70 million due to the drop in the market. Meanwhile it have faced several criticism, warnings and lack of support. Amidst that El Salvador stays strong in its decision. During the first year of adoption it is termed as a failure through different surveys. After several negative comments against El Salvador's adoption of bitcoin President Nayib Bukele is strong to make his country better through bitcoin.

When a person is new to the bitcoin market, everyone used to give suggestion that you should have patience to enjoy the growth of bitcoin. Here also same is the situation, but very few agree on it whereas majority make fun how the president is gonna come out of the ongoing crash that'll have impact on country's economy.

[bitterguy28]

Elsalvador country is a country that dares to legalize bitcoin as a medium of exchange, I applaud the elsalvador government they can revive the economy in their country by legalizing bitcoin but yesterday I read the news there were a few people who held demonstrations they refused to use bitcoin as a medium of exchange maybe some people are not happy with government decisions in their country.

seriously? you have just read  the news yesterday? when the demonstration had been going on since day 1 of adoption?

the EL Salvadorian is not that happy for them being forced of this adoption when  the government can make a trial first or at least to have a plebiscite  so they can learn the peoples heart about Bitcoin.

Now this become a bad omen to the country because the supposedly to help their economy ? look at their country now.

[jokers10]

...
base on my conviction I don't see any reason why chivo wallet being centralized should be a challenging factor in a country that adopts bitcoin as a legal tender, it will rather do more good to help those you mentioned that complained their inability to know how to engage the use of bitcoin, if you have the experience about bitcoin as an El-Savadoran and uses chivo wallet then i don't see anything bad if you want to secure more privacy by using an open source wallet along the line, we can't expect the entire citizens to go all decentralized, that will give a serious complications at first, scam rate and many other loss of digital asset will be lost, remember you're dealing with the whole populace of El-Savador.

Who controls the keys? I think about it over and over: who controls El Salvador's bitcoin savings keys? Who controls keys of Chivo wallets? How would these funds be protected after transfer of power? What is good in bitcoin is that I don't need to think about trust towards anyone. How it is done in El Salvador makes me think about trust towards Bukele and his team. It is not the same to me.

[_act_]

Now this become a bad omen to the country because the supposedly to help their economy ? look at their country now.

Explain this into details, how has bitcoin affected El Salvador?

Who controls the keys? I think about it over and over: who controls El Salvador's bitcoin savings keys? Who controls keys of Chivo wallets? How would these funds be protected after transfer of power? What is good in bitcoin is that I don't need to think about trust towards anyone. How it is done in El Salvador makes me think about trust towards Bukele and his team. It is not the same to me.

You still do not get the fact

Some countries government are hostile to bitcoin and never like its adoption and make a ban, just like China, but reverse is the case with El Salvador, bitcoin was adopted, even as a legal tender.

If something is accepted as a legal tender, the government will want to have control, El Salvador as a country bought the bitcoin that are used with Chivo wallet which is centralized, making fee to be cheap and transactions to be instant. That is how he centralization is helping.

But it is not compulsory Salvadorans should use Chivo wallet, if they like, they can use Electrum or other noncustododial wallet if they want.

About the transfer of power, remember bitcoin transaction is more transparent than fiat, the government can not mishandle bitcoin if compared with fiat.

I think you need to wake up, if you are a Salvadoran, use noncustododial wallet instead of Chivo wallet if you want.

[estenity]

Now this become a bad omen to the country because the supposedly to help their economy ? look at their country now.

Explain this into details, how has bitcoin affected El Salvador?

Who controls the keys? I think about it over and over: who controls El Salvador's bitcoin savings keys? Who controls keys of Chivo wallets? How would these funds be protected after transfer of power? What is good in bitcoin is that I don't need to think about trust towards anyone. How it is done in El Salvador makes me think about trust towards Bukele and his team. It is not the same to me.

You still do not get the fact

Some countries government are hostile to bitcoin and never like its adoption and make a ban, just like China, but reverse is the case with El Salvador, bitcoin was adopted, even as a legal tender.

If something is accepted as a legal tender, the government will want to have control, El Salvador as a country bought the bitcoin that are used with Chivo wallet which is centralized, making fee to be cheap and transactions to be instant. That is how he centralization is helping.

But it is not compulsory Salvadorans should use Chivo wallet, if they like, they can use Electrum or other noncustododial wallet if they want.

About the transfer of power, remember bitcoin transaction is more transparent than fiat, the government can not mishandle bitcoin if compared with fiat.

I think you need to wake up, if you are a Salvadoran, use noncustododial wallet instead of Chivo wallet if you want.

it is an experiment, final success is not warranted.

[PokestarFan]

Well that worked out great for them. Because now people are going to demand their actual currency and make inflation even higher.

[_act_]

it is an experiment, final success is not warranted.

A country make a coin a legal tender, you are calling it an experiment, that is completely wrong. Some other countries can see it as an experiment for them to know if it will work good in El Salvador or not, but not an experiment in El Salvador.

[Odusko]

Well, that worked out great for them. Because now people are going to demand their actual currency and make inflation even higher.

I think you are beginning to add feelings into this whole thing, don't used present Bitcoin price conditions to judge long term goals. El Salvador is a country and its total Bitcoin holding has never be touched or sold before and this is because the country have a long term goals for Bitcoin not some short fallacy of getting rich quck mindset.

[tadamichi]

Well that worked out great for them. Because now people are going to demand their actual currency and make inflation even higher.

They’re still using the US dollars and Bitcoin as legal tender, no „actual currency“ was ever taken away, what is there to demand? Chivo(their wallet) actually let’s people decide if they wanna receive Bitcoin or usd, you can convert anytime you want, no one is forced to keep payments in Bitcoin.

Before i cringe too hard, please inform yourself what actually causes inflation, if more people did maybe we wouldn’t be in this mess.

It’s funny that people that don’t even understand what causes inflation, come here with a time horizon of a few months(that’s not how to build things), and then try to judge one of the poorest countries in the world for trying to better things. Where were y’all before they adopted Bitcoin? Y’all didn’t give two shits.

They certainly don’t need approval from a mob of emotional people that don’t even understand basic economics. And an exchange rate into usd doesn’t change what Bitcoin is, it still works the same as before, still has sound monetary properties. Let people time to build things without falling into hysteria, thanks.

[jokers10]

...
You still do not get the fact
...

I know all that. We are talking about reasons why Salvadorians can protest against bitcoin adoption and not transparent system is one of most substantial reasons for that. If we'll get answers to the questions about the keys it will not solve all the problems but will make the situation more transparent. And yes, I totally agree that it is much more reasonable for Salvadorians to use non custodial wallets instead of Chivo.

[_act_]

I think El Salvador government prepared before they accepted bitcoin as a legal tender, see what Alejandro Zelaya, the minister of finance of El Salvador said about buying bitcoin.

https://cointelegraph.com/news/el-salvador-has-not-had-any-losses-due-to-bitcoin-price-dive-finance-minister-says

“There is a clear criticism of Bitcoin as such, not of El Salvador's strategy. El Salvador is what interests them the least, they [the media outlet] are not interested in what happens to our economy, they are not interested in what happens with our people, what happens with inflation.”

“I have said it repeatedly: A supposed loss of 40 million dollars has not occurred because we have not sold the coins.”

We all know that the second  quote is true, 1 BTC is equals to 1 BTC, if El Salvador has not sold bitcoin, this is not loss. Some holders will see the price falling, only what they think about is to wait for another years for all-time-high.

How do you see people that are criticizing El Salvador government as bitcoin price has decreased? As for me, I see them as someone that will only panic and sell, thinking they have lost money, but latter regret this in long term when the price of bitcoin reach all-time-high.

[DdmrDdmr]

<...>

“I have said it repeatedly: A supposed loss of 40 million dollars has not occurred because we have not sold the coins.”

<...>

Sometimes though, you can’t have it both ways …:

Whilst the above is true on its own, not that many months ago, the non-realized surplus due to BTC prise rise back then was the argument for financing the construction of the Pet Hospital:

<…> I've always wondered how that hospital is going to be built from the profits of investing in BTC while no bitcoin will be actually sold. <…>

By playing along dangerously with the numbers, in a manner similar to fable the milkmaid and her pail:

When he announced the Pet Hospital back in October, he twitted an explanation on where the funds were coming from. The tweet (see https://twitter.com/nayibbukele/status/1447017312893161478 and scroll down) is in Spanish, so I‘ll summarize the core parts in English (freely translated, with my minor added comments):

FIDEBITCOIN (the Bitcoin Trust) has, by law, an allocated amount in USD.
Nevertheless, its balance sheet bears both USD and BTC [the latter derived from the purchases].
<…>
The Trust is now worth more than the allocated figure, due to the rise in price of BTC, rendering FIDEBITCOIN with a "surplus" of 4M $ [theoretical on the books, and forever changing with BTC price fluctuation].

Therefore, the government made company, Chivo, can dispose of 4M $ [October 2021 numbers], without affecting the Trust’s allocation.
This is carried out by keeping the same amount of BTC, and reducing the amount of USD. We can therefore invest 4M $ in some project.

So we decided to invest part of that money in a Pet Hospital.
<…>

There we go, the perfect potential example of the former part of to fable the milkmaid and her pail. While BTC goes up, they extract USD from the trust, keeping the book value of the Trust near the legal allocated value. The problem is, that BTC could go down, and activate the second part of the fable …

It’s a dangerous game playing each direction with a different set of rules (though we may know which one is right and which one isn't)…

[sklopan]

I am sure that it is worth looking for a very thin level between whether to use bitcoin, and if so, in what volumes. I think it's pretty important.

[tadamichi]

<...>

“I have said it repeatedly: A supposed loss of 40 million dollars has not occurred because we have not sold the coins.”

<...>

Sometimes though, you can’t have it both ways …:

Whilst the above is true on its own, not that many months ago, the non-realized surplus due to BTC prise rise back then was the argument for financing the construction of the Pet Hospital:

<…> I've always wondered how that hospital is going to be built from the profits of investing in BTC while no bitcoin will be actually sold. <…>

By playing along dangerously with the numbers, in a manner similar to fable the milkmaid and her pail:

When he announced the Pet Hospital back in October, he twitted an explanation on where the funds were coming from. The tweet (see https://twitter.com/nayibbukele/status/1447017312893161478 and scroll down) is in Spanish, so I‘ll summarize the core parts in English (freely translated, with my minor added comments):

FIDEBITCOIN (the Bitcoin Trust) has, by law, an allocated amount in USD.
Nevertheless, its balance sheet bears both USD and BTC [the latter derived from the purchases].
<…>
The Trust is now worth more than the allocated figure, due to the rise in price of BTC, rendering FIDEBITCOIN with a "surplus" of 4M $ [theoretical on the books, and forever changing with BTC price fluctuation].

Therefore, the government made company, Chivo, can dispose of 4M $ [October 2021 numbers], without affecting the Trust’s allocation.
This is carried out by keeping the same amount of BTC, and reducing the amount of USD. We can therefore invest 4M $ in some project.

So we decided to invest part of that money in a Pet Hospital.
<…>

There we go, the perfect potential example of the former part of to fable the milkmaid and her pail. While BTC goes up, they extract USD from the trust, keeping the book value of the Trust near the legal allocated value. The problem is, that BTC could go down, and activate the second part of the fable …

It’s a dangerous game playing each direction with a different set of rules (though we may know which one is right and which one isn't)…

I agree, they’re using an accounting trick that can be risky depending on how much is actually being put into the trust.

To be fair tho, i think they took the danger into account. The trust is relatively small with just 150 million $, this can’t bring them into any serious risk.

Also with the hospital thing, they marketed a short sited gain as a win, which is questionable(but this is politics). But i still think a country with such a weak economy should invest into infrastructure and jobs and this 4 million $ were more than well spent.

// Edit: Also i cant think of a model that better fits their interests than this.

1. As Bitcoin goes down, they can accumulate more sats for cheap, keeping the trusts value stable.

2. As Bitcoin goes up, they can pull usd out and take home profits.

Leaving them with more and more Bitcoin over time, till they run out of usd. Then they can scale the trusts value higher.

They would never need to dump btc on the market(which is good for price), but they can still pull out profits and stack sats. This fits perfectly into the bet we all do with Bitcoin, we want more sats not fiat. Is there a smarter way than this?