Will governments capitulate and finally recognize Bitcoin as a legal tender?

[Poker Player]

After El Salvador regulated Bitcoin as legal tender, other countries are tempted to follow in its footsteps:

Brazil Set To Adopt Bitcoin As Its Legal Tender

Panama unveils bill to make Bitcoin legal tender

Ukraine could soon become the second country to adopt Bitcoin as legal tender

Obviously these are countries that have seen an opportunity, but it is much more difficult for countries like the USA, EU countries, Australia, etc. to do so. So far Bitcoin has been regulated in most countries as (intangible) property. Consequently, it has also been taxed so that every time you spend Bitcoin you should declare and pay taxes. If you buy $1,000 of Bitcoin, the price goes up 10% and you buy a $5 coffee at Starbucks, you will owe taxes on 10% of that $5. If the next day the price of Bitcoin goes down and it is only 5% above your initial investment, when you make a purchase you will also owe taxes but only on 5%.

This, as I explained in another thread, makes it difficult for Bitcoin to be used as a day-to-day currency. In order to keep track of all transactions and pay taxes correctly you should rely on some App or some kind of software that keeps track of transactions and does the calculations for you. This means giving up your privacy and giving your purchase data to a centralized entity.

However, if Bitcoin is recognized as a legal tender, you will no longer have to pay taxes for buying coffees. In the same way that you don't have to pay taxes when you shop at the supermarket in dollars because the dollar has appreciated 2% against the euro in the last day.

I understand that the governments of the most economically powerful countries are going to be much more reticent than El Salvador and others who are seeing an opportunity.

On the one hand, if they make it legal to tender, they will lose money to be collected in direct taxes, and on the other hand they will lose at least part of the power they have with the massive printing of currency.

That is why I wonder if in the future, more and more countries will pass legislation that considers Bitcoin legal to tender and in the end the more economically powerful countries will have to capitulate and do the same.

What do you think?

[Kong Hey Pakboy]

Superpower countries will be the hardest one to budge in, other countries wouldn't have that much problem so I am pretty sure that this is going to be a chain reaction that has the superpowers at the end of the domino line.

[nullama]

You can add Tonga to that list

source: https://stockhead.com.au/cryptocurrency/tonga-might-consider-bitcoin-as-legal-tender-if-laser-focused-mp-gets-his-way/

This is the key:

“To get those remittances to Tonga, Western Union takes a 30 per cent bite out of them, on average. It can be 50 per cent. In El Salvador, it’s closer to 50 per cent. So, our GDP in 2020 was $US510 million, 40 per cent of that is just over $US200 million so 30 per cent of that or $US60 million is fees alone to Western Union.”

Countries that are remittance-dependent, like El Salvador and Tonga, will probably be the first ones to make Bitcoin legal tender.

Other countries will probably want to keep their capital gains tax.

[Mugtaiya]

venenzuela should be next. their country needs to get out of the shit very quickly before their entire economy collapses.

[Kittygalore]

venenzuela should be next. their country needs to get out of the shit very quickly before their entire economy collapses.

It's not going to help them, they need a new leader that cares for them and at the same time helps the people and the country, not someone who's just a product of another bad government and someone who hires a secret organization to protect and destroy dissidents and oppositions.

[electronicash]

countries like brazil or panama will apply the same way how el salvador do that their local currency will work along with BTC.

for first world countries i think will also do the same but with CBDC coin. it may take another cycle before they will decide to also make BTC a legal tender. right now they will have to take advantage of printing more of their currency, its more favorable.

[hugeblack]

Why all the complications? It is easy to change the laws related to commodities, and if countries see that more people are buying bitcoin, they will start setting up separate law-projects related with cryptocurrency, but most of the time they will be considered assets of a special nature
For example:


 - any transfers less than $10,000 are not taxed.
 - If you own a certain value of cryptocurrencies, you must report it to the authorities.
 - All platforms that buy and sell bitcoins need to ask members for KYC.
 - Centralized platforms are set up and thus stores and shops are allowed to accept Bitcoin using these platforms.

Generally, things will not change unless the demand increases, which is directly related to the price, meaning that we need a market capacity of 5 trillion to see some changes.

[fiulpro]

If Bitcoins does become a Legal Tender, it would be amazing for all the crypto users in the world since there would be way more options, less tax, freedom to choose another payment method etc. It can finally be used not only as an investment but also as a currency, which can in turn expand the whole ecosystem..

It can finally become a one world currency. I do understand the Volatility might play a significant role but at the same time, people might have better access to international transactions and businesses are gonna flourish even more.

The probelm would be Government and Banks, taking it as a COMPETITION, whereas they should take it as a synergistic relationship, where both parties can grow.

I do think this would definitely happen in the future but it depends on the government for sure, how fluid they are with the whole thing. ( Till then countries like El Salvador, will definitely get a head start )

[avikz]

After El Salvador regulated Bitcoin as legal tender, other countries are tempted to follow in its footsteps:

A minor percentage of countries only! A dmall county like El-Salvador can't have heavy industries that can generate mass income and employment. So they had to rely on alternative things that help with their economy. So while bitcoin may be beneficial for El-Salvador, it may not yield same result in Brazil.

I still don't think majority of the government are serious enough regarding bitcoin. They are either ban it or strictly regulate it. Making bitcoin a legal tender is still a far fetched dream for majority of the governments.

[stompix]

You can add Tonga to that list
source: https://stockhead.com.au/cryptocurrency/tonga-might-consider-bitcoin-as-legal-tender-if-laser-focused-mp-gets-his-way/

This is the key:

“To get those remittances to Tonga, Western Union takes a 30 per cent bite out of them, on average. It can be 50 per cent. In El Salvador, it’s closer to 50 per cent. So, our GDP in 2020 was $US510 million, 40 per cent of that is just over $US200 million so 30 per cent of that or $US60 million is fees alone to Western Union.”

Again with these stupid numbers?
Here is an actual transfer from WU:



You pay exactly $4 to send $100, that's not 30% and not 40%.
If you would send $1000 the fee would drop to 0.7%.

[Silberman]

I understand that the governments of the most economically powerful countries are going to be much more reticent than El Salvador and others who are seeing an opportunity.

On the one hand, if they make it legal to tender, they will lose money to be collected in direct taxes, and on the other hand they will lose at least part of the power they have with the massive printing of currency.

That is why I wonder if in the future, more and more countries will pass legislation that considers Bitcoin legal to tender and in the end the more economically powerful countries will have to capitulate and do the same.

What do you think?

I could see it happening but I do not see those governments that are at the very top relinquishing that power without a fight, I really think that in order for that to happen we are going to have to see a massive crisis caused by their money printing policies all over the world, the massive adoption by the people in order to protect themselves from those effects, the banning of bitcoin in a weak attempt to protect their fiat currencies and finally the failure of those policies for them to finally understand that making bitcoin legal tender is the only choice they have left.

[Viscore]

After El Salvador regulated Bitcoin as legal tender, other countries are tempted to follow in its footsteps:

A minor percentage of countries only! A dmall county like El-Salvador can't have heavy industries that can generate mass income and employment. So they had to rely on alternative things that help with their economy. So while bitcoin may be beneficial for El-Salvador, it may not yield same result in Brazil.

I still don't think majority of the government are serious enough regarding bitcoin. They are either ban it or strictly regulate it. Making bitcoin a legal tender is still a far fetched dream for majority of the governments.

This makes sense to me. For now, i really believe that only few number of countries have been considering taking bitcoin as a legal tender and majority still chooses their own monetary system to be their medium of exchange. This is because most of the governments still prefer fiat because it can be controlled by them and since bitcoin is decentralized, they can't give their full support on it. And considering the central banks focus on fiat so they will keep on printing paper money as much as they can. Big countries may have less chances to recognize bitcoin as a legal tender because majority of the citizens still chose fiat not because they are used to it, but they really believe its for a lifetime use cases despite of the high inflation associated in it.

[dothebeats]

It will take some time before governments finally agree to it. A lot of research is still needed to be done before nations can allow bitcoin to be used as a legal tender. I'm all in for that idea but it's pretty hard to achieve. El Salvador, for sure, made a lot of rigorous research and sifted through a lot its own legal framework before they granted the cryptocurrency its current legal status.

Also, most countries still have a pretty stable currency of their own, that the need to introduce a new legal tender is not really necessary and may even be detrimental to those countries' economies.

[TimeTeller]

It will take some time before governments finally agree to it. A lot of research is still needed to be done before nations can allow bitcoin to be used as a legal tender. I'm all in for that idea but it's pretty hard to achieve. El Salvador, for sure, made a lot of rigorous research and sifted through a lot its own legal framework before they granted the cryptocurrency its current legal status.

Also, most countries still have a pretty stable currency of their own, that the need to introduce a new legal tender is not really necessary and may even be detrimental to those countries' economies.

Also, I think these countries which are looking at the possibility of making bitcoin as legal tender will assess the situation of El Salvador at least after 6 months of implementation.
They will evaluate if that move is beneficial to the growth of the economy or not. Or are there positive things accompanied by this bold move?
So yes, it will take time for them to decide on this matter. As they will also check the viability of this decision to their actual situation in their country.
Because they may have other considerations in their financial system. They of course, need long talks with their Central Bank and how to implement it.

[hatshepsut93]

Brazil Set To Adopt Bitcoin As Its Legal Tender

Panama unveils bill to make Bitcoin legal tender

Ukraine could soon become the second country to adopt Bitcoin as legal tender

Ukraine is absolutely not looking at adopting it as legal tender, they recently adopted a law that would regulate cryptocurrency, and they specifically said that it can't be used as a payment method.

People here love to call out mainstream media for incorrectly covering Bitcoin, but Bitcoin media spin lies and misinformation all the time, usually just to create FUD or FOMO, whichever is more prelevant at the moment.

[hello_good_sir]

I doubt it.

They will likely fight bitcoin until the end which is rather sad, but I don't see fiat winning the battle with grassroots support on bitcoin's side.

The restrictions, KYC/AML and such are all a result of the current governmental pushback. I don't see an end in sight for these things.

[Finestream]

I doubt it.

They will likely fight bitcoin until the end which is rather sad, but I don't see fiat winning the battle with grassroots support on bitcoin's side.

The restrictions, KYC/AML and such are all a result of the current governmental pushback. I don't see an end in sight for these things.

The government will never allow for a decentralized coin to be a legal tender so bitcoin will really find it hard to be one. And if it may happen in the future, i think a lot of struggles will come along the way including the strict restrictions made by the government. This will only be stopped if there is a sudden change on the view of the government towards bitcoin. I know it will certainly happen if the adoption for bitcoin in such big countries will start to increase.

[Hydrogen]

This, as I explained in another thread, makes it difficult for Bitcoin to be used as a day-to-day currency. In order to keep track of all transactions and pay taxes correctly you should rely on some App or some kind of software that keeps track of transactions and does the calculations for you. This means giving up your privacy and giving your purchase data to a centralized entity.

Holding BTC as disposable income for remittance payment, rather than as an HODL investment. $1,000 in bitcoin could be exchanged for $1,000 in stablecoin to avoid price swings. Then exchanged for BTC again for payment.

Governments only "capitulate" to the informed, motivated and organized public. If people become uninformed and unorganized enough for governments to get away with oppressing them. That often occurs.

For many years legalizing gambling was a common theme for how to boost local economies. Then legalizing and taxing marijuana became the common theme. 2021 we don't hear many proposals for legalizing gambling or weed. Everyone only talks about legalizing cryptocurrencies. This is what real progress looks like, am I right.

[Mahanton]

Cant still be sure because not all government would really be having the same mindset,will,views and perception on things which means decision would really vary according on what they had pictured out.

Decisions made isnt something that easy for those who had adopted or recognized bitcoin just like on what El salvador did.If all governments will capitulate then we know on whats the positive impact
but this thing seems to be an impossible or wont really be happening at all.They do have different views and being decentralized is something an issue that they will mainly put into the table.

[Darker45]

It might just be a matter of time before another country will adopt Bitcoin as a legal tender. But, for me, countries don't have to actually give Bitcoin that status. I think it is enough that Bitcoin is legally accepted as an alternative currency which people and businesses have the freedom to use or not. As a legal tender, there is a connotation that business establishments are all required to accept it. Countries must have different set of rules and regulations pertaining to the legal tender status, of course, but to avoid complications it might be enough, at least for now, that Bitcoin is legally acknowledged as an alternative money.