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[jaysabi]

Without quoting the whole OP, I think traditional money transfer businesses like Western Union and Moneygram are on the decline, but also they were on the decline prior to bitcoin.  They're being disrupted by other centralized payment processors like PayPal, Square, Venmo, etc.  The old wire transfer services were prime for disruption because they were expensive compared to alternatives.  But other centralized payment processors are fast and cheap and easier to use than bitcoin, so I don't anticipate them being disrupted by bitcoin.

[Argoo]

I had a serious question from an economics student in my country, and he was intrigued by the news that El Salvador had adopted Bitcoin.

He said: Would it be enough with the current available supply, if all countries adopted Bitcoin as a legal payment like El Salvador did? if enough what is the reason?

As someone who has limited knowledge, of course, I can't answer it scientifically with strong references. So dealing with this exact topic would be invaluable for me to gain enlightenment from those of you who understand more than what I know.

thanks ...

Considering that each bitcoin has one hundred million satoshis, I think this would be enough for all countries that would use it as a means of payment.
However, there is no need to triumph over the situation with El Salvador yet. Too little time has passed to draw any conclusions. In any case, one should hardly expect the transition of states to payments in bitcoins, they will always have their own digital currency closer.

[davis196]

The fact that 1.6-2 million people started using Bitcoin/Lightning Network in El Salvador doesn't necessarily mean that all those 2 million people will keep using Bitcoin/LN transactions forever.Some of them will quit,others will join later.I assume that many people joined Chivo,because of the incentives provided by the government of El Salvador.Once the incentives are over,many people will just leave Chivo.
I know that the traditional financial services and banks have low ratings in El Salvador,but as the Chivo network keeps growing,more and more people will also leave low ratings to Chivo.
Many of the low ratings are left by confused people,who got frustrated by a situation that was caused by their fault,but they blame the companies,because that's what people do.
I'm not advocating on the banks in El Salvador,but many people leave negative reviews just because they want to,not because the bank scammed them or something.The same thing can be applied for negative reviews left for the Chivo app.

[SquallLeonhart]

The fact that 1.6-2 million people started using Bitcoin/Lightning Network in El Salvador doesn't necessarily mean that all those 2 million people will keep using Bitcoin/LN transactions forever.Some of them will quit,others will join later.I assume that many people joined Chivo,because of the incentives provided by the government of El Salvador.Once the incentives are over,many people will just leave Chivo.

I still think that if 1.5-2 million people would be enough for it to be growing big and staying big. Yes, there will be some people leaving, but at the end of the day we are talking about something that is forever and not just for now, even the ones that left may rejoin later on and the number between 1.5-2 million will probably stay.

This is why I believe that we should probably not focus on anything else, just focus on "how much" they use, like instead of number of people, we should be checking the usage and if people are using it a lot then we could make a good profit.

[Haunebu]

I don't think traditional payment processors will disappear anytime soon just because BTC has been accepted by a small country and has been bullish in recent times. However, it is a possibility thanks to the negligible BTC fees in recent times.

If the fees stay in the 1 - 8 sat/vB range for a long period, I don't really see the need for LN to be honest. Also, more big countries need to accept and regulate BTC and other popular cryptocurrencies.

[fullhdpixel]

Now this is the real question. I am sick and tired of people talking about how bitcoin or crypto could replace fiat and that's not what it is all about,  crypto should not be replacing anything in the fiat world, it wasn't even created for that neither. However payment processors have been living a great life for a long time, without much competition and we should have been using crypto for that purpose to begin with.

Unfortunately the amount we are spending on each transaction is too much for most coins at the top, bitcoin and eth costs so much to spend and you can't have payment processors charging that much. However if we could lower that, and make it under 50 cents, then I am pretty sure it could replace most of the payment processors in the world.

[AicecreaME]

El Salvador became the first country where bitcoin was accepted as a means of payment. How has this affected centralized payment systems and what will be the trend in the future as more countries follow the path of El Salvador?

I recently came across an article https://www.kevinrooke.blog/el-salvador-and-bitcoin-two-weeks-in/. It talked about how bitcoin adoption proceeds in El Salvador, and there I discovered interesting facts.

Thanks to El Salvador, the Lightning Network received a powerful impetus in development. This happened thanks to the popularization of the Chivo wallet and the incentives that the government of El Salvador guaranteed when it was installed. In total, the Lightning Network gained about 2 million new users:

Many users began to actively use bitcoin payments and money transfer using the Chivo wallet and support for the Lightning Network. Consequently, the Salvadorans increasingly began to use bitcoin services instead of the usual banking or payment processors:

Most of El Salvador's banks and payment processors have user ratings of 2-4 stars, while Bitcoin related apps have user ratings of 3-5 stars.
Specifically, El Salvador's largest bank, Banco Agricola has among the worst user reviews on the top 20 charts. El Salvador's leading mobile money transfer platform, Tigo Money, has reviews that are just as bad.

The use of the Lightning Network has exploded, creating a powerful network effect with the infusion of several million new users into the ecosystem. People see the benefits and potential of fast, low-cost transfers and are choosing to use the Lightning Network over the usual centralized transfer methods. This is evidenced by the official data of the stock market.

As we can see, since July (when El Salvador's plans to accept bitcoin were announced), Western Union and MoneyGram began to fall, and continue their downward trend. While bitcoin is growing and gaining strength.

The era of traditional money transfers is coming to an end and this business, if it does not disappear completely, will significantly reduce its influence in the world. Other countries will follow in the wake of El Salvador, and millions of new users will join the ecosystem. What do you think about this?

It's still too early to say that this is the beginning of the end of traditional payment methods. The government of El Salvador is supporting the development of transitioning to digital payment using bitcoin as a legal tender. Hence, a lot of people are also supporting the implemented law by the government by installing the application and other things needed to be able to transact with btc. Aside from these people that use a lightning network, surely there are still people using the traditional payment methods. After all, not everyone is privileged enough to have the resources to attain such digital and contactless transactions. There are still people out there such as the less fortunate ones and the older generations that are still using traditional payment methods. Despite the surge of the rate of those people using digital options in El Salvador, in general, I still believe we are still far ahead from completely transtioning to the digital payment process all in all.

[finaleshot2016]

I don't believe that traditional payment methods will be phased out because some people, including those who use cryptocurrencies in their daily life, still advocate for them. Traditional payments are still used in various scenarios, and all I can say is that they are more efficient and practical in particular transactions involving large sums of money or valuable assets. It is merely the beginning of another payment method; it is not the end of the conventional manner; even in other areas, traditional systems are still preferred because they create better results, despite the fact that technology is rather advanced right now.

[LastKiss]

I only saw chaos from news in my phone when El Salvador adopted bitcoin as their main currency, a lot people confuse how to use it and instead exchange their free funds from bitcoin to USD. A lot people destroying Bitcoin ATM, a lot people only wants free money. It's hard when old people dont know what bitcoin it is, they only trust their old currency but I appreciate for EL Salvador to trying to make a change and make them role model to us.

[stompix]

I agree that this will affect people’s decision to transfer BTC or USD, but in the case of El Salvador, we know that they have set up 50 Chivo ATMs in the largest US cities, which means you insert USD into ATM and automatically get BTC free of charge into your Chivo wallet, and then you send that same BTC for a minimal fee to any other Chivo wallet. Let someone correct me if I’m wrong, but I realized that the whole thing works that way.

They are not in the largest cities:

El Salvador has rolled out 50 commission-free Chivo bitcoin ATMs in 10 U.S. cities to make it easier and less expensive for people to send money to friends and family members in the Central America country.
The cities with Chivo bitcoin ATMs include Chicago, Dallas, Houston, Los Angeles, San Francisco, along with Columbus, Ohio; Doral, Fla.; and El Paso, Laredo and McAllen, Texas.

Besides, even if 50 sounds like a  lot, let's remember that Texas is nearly twice as large as Germany, so if those 50 ATMs look now like each Europan country having one . You need a ton more than that, Moneygram has 22 000! and WU 40 000!
It's a start but it needs a lot more, that's why I said the bridge needs to be built, right now poeple are still mainly swimming across. 

Isn't Chivo giving away $30 to anyone who registers? Of course a lot of people in a poor nation would want to claim free money. The article claims that millions of users were added to Lightning Network, while in reality millions of people just installed an app. Not a fact that they will use it in their daily lives. A lot of people will uninstall it once they claim the free $30 or will use it a few times per year. It's completely unrealistic to think that millions of people who a few weeks ago didn't care about Bitcoin are not "Bitcoin users" who conduct their purchases through LN.

Of course, the number of installs is meaningless to usage.
If we add the downlaods of every bitcoin wallet available in google play we end up with more addresses than the blockchain holds, so...



So, it is 2 million but 14 000 transactions per day, so, a bit more than 0.5% doing a transaction a day.
Not really the best figures but I wasn't expecting more anyhow, in order for poeple to spend be it fiat or bitcoin people must have money in the first place, and that's not one Salvador strong points.

[hatshepsut93]

So, it is 2 million but 14 000 transactions per day, so, a bit more than 0.5% doing a transaction a day.
Not really the best figures but I wasn't expecting more anyhow, in order for poeple to spend be it fiat or bitcoin people must have money in the first place, and that's not one Salvador strong points.

That image says 14k transactions per day via ATM, but in the top right corner it says 65k transactions per second in dashboard, what does that mean? Is this like maximum theoretical capacity or something? Because not even Visa has 65k transactions per second globally.

[stompix]

That image says 14k transactions per day via ATM, but in the top right corner it says 65k transactions per second in dashboard, what does that mean? Is this like maximum theoretical capacity or something?

It's ...something:
https://twitter.com/nayibbukele/status/1442624279028408321

“Transacciones por segundo” doesn’t mean that we have 65,437 new transactions every sec, but that the system is processing an average of 65,437 transactions every sec.
Remember a single transaction takes several secs.

Probably he doesn't know the answer himself.
Either way, even if a transaction would take 10 seconds so it would be 65,437 every 10 seconds it would mean 500 million transactions per day, which is just...common!

Not that I would trust any number coming from the 100MW/shaft guy anyhow.

[hatshepsut93]

Probably he doesn't know the answer himself.
Either way, even if a transaction would take 10 seconds so it would be 65,437 every 10 seconds it would mean 500 million transactions per day, which is just...common!

Not that I would trust any number coming from the 100MW/shaft guy anyhow.

El Salvador has 6.5 million people, so they all have to have phones, install Chivo and do a bit below 100 transactions every day to reach that number  🤡🤡🤡

With every day Nayib Bukele looks more and more like an incompetent populist. I have a feeling that in the end it will only bring bad rep for Bitcoin.

[GeorgeJohn]

Bitcoin and cryptocurrencies are of interest to people when inflation absorbs their economies that is a good sign for businesses to start including cryptocurrencies as a means of payments. I could perceive it when I shared with the owner of a business that I bought her construction materials to repair my roof. The owner of the business approached me and asked me to teach her how to use cryptocurrencies. I have not taught her yet because I have had very little time to dedicate to her but I will, but in addition to time I was stopped by the knowledge that the owner of the business is a usurer.

It may likely seen that many people are inquisitive of having a business transaction or any form of payment with cryptocurrency which note down by bitcoin, but it seems that while they are scared is due to lack of understanding or knowledge with cryptocurrency regulations and terms, so i believe from your explanation that while some prefer traditional system of payment is because they have acclimatized with such kind of payment patterns via local currency, on like me if any one devote out time to learn cryptocurrencies ways of transactions, i will make sure i have impact the knowledge to the person, provided that the person in question have an interest over it, definitely i will make out chance to educate the person in particular.

[Silberman]

Without quoting the whole OP, I think traditional money transfer businesses like Western Union and Moneygram are on the decline, but also they were on the decline prior to bitcoin.  They're being disrupted by other centralized payment processors like PayPal, Square, Venmo, etc.  The old wire transfer services were prime for disruption because they were expensive compared to alternatives.  But other centralized payment processors are fast and cheap and easier to use than bitcoin, so I don't anticipate them being disrupted by bitcoin.

You are not wrong, those services are on the decline as the technology that we have available has become too disruptive for their services to remain working in the same way, however bitcoin has the potential to be even more disruptive because the main users of those services were those without a bank account, people which could not send their money with a bank transference, and now they can send their money to their family members for a very cheap fee. with bitcoin

[Bitstar_coin]

El-Salvador is just a tiny bit of the whole world and the result there can not be use as a reference point here, it is a great news that El Salvador have embrace the use of btc as a legal means of payment but there are millions of people in different part of the world who are using the traditional payment system, majority are unaware of crypto, I think there is still a long way before we can say this.

[ninkdwi]

Isn't Chivo giving away $30 to anyone who registers? Of course a lot of people in a poor nation would want to claim free money. The article claims that millions of users were added to Lightning Network, while in reality millions of people just installed an app. Not a fact that they will use it in their daily lives. A lot of people will uninstall it once they claim the free $30 or will use it a few times per year. It's completely unrealistic to think that millions of people who a few weeks ago didn't care about Bitcoin are not "Bitcoin users" who conduct their purchases through LN.

plot twist it's true it might go up when it's like that.
because at this time, especially in a pandemic and in a country's economy that is below average then anyone will definitely receive $30 for free.
this is like an airdrop that is given without the need to do anything, just install the application, then $30 is obtained who will refuse it

[palle11]

This only tells the story of one country, and I'm pretty sure other countries with a pretty stable banking system and money remittance services would like to keep things how it is for quite some time. But what's happening in El Salvador might be a catalyst of what's to come in the future. Perhaps banks and money remittance services would adopt a similar structure to crypto, but them as an entity would still surely remain solid as they are right now. They'd need to adapt to the changes, and if copying how bitcoin and crypto does it is the only way to do it, they'd do so in a heartbeat.

Countries that don't have a standard expectation of economic growth will want to embrace bitcoin as a means of help to their economy with hope that it volatility will further increase their worth. This is possible to happen though but it won't be a reason the most industrialised countries will adopt. El Salvador adopted bitcoin maybe they want to hodl on volatility to help the lucky hodlers but other countries may still hold on to the traditional banking system for more time in the future. They may not totally exchange it for bitcoin but having an option will be the best to hang on to tradition and modern system.

[stompix]

~

El Salvador has 6.5 million people, so they all have to have phones, install Chivo and do a bit below 100 transactions every day to reach that number  🤡🤡🤡
With every day Nayib Bukele looks more and more like an incompetent populist. I have a feeling that in the end it will only bring bad rep for Bitcoin.

Well, I dislike the individual completely, he is at least half lying in his statements and when he can't lie he just tells parts of the story. If he would have had the numbers play in his favor he for sure would have made them public, but he is not, he isn't talking about how much hashrate he's got going, how many transactions a day are there, and many others. He doesn't really care about crypto, he cares about being in the spotlight.

But at the same time, it's understandable the numbers are low, who would use bitcoin to buy stuff in a bull run? It's damn normal, even I would do the same.
The poeple who don't care about BTC have long sold their 30$, the rest are keeping them or if they buy on top of that hold that also, so I assume that just as in other countries the percentage factual daily-weekly user would be around 1% of the ones holding coins.

One month since launch, 12% of consumers have used the cryptocurrency, the Salvadoran Foundation for Economic and Social Development reported.
But the foundation, which polled 233 companies across different sectors, found that the overall use was still low, with 93% of companies reporting no bitcoin payments.

Not surprisingly, in order to spend money, you need money...

[lixer]

The era of traditional money transfers is coming to an end and this business, if it does not disappear completely, will significantly reduce its influence in the world. Other countries will follow in the wake of El Salvador, and millions of new users will join the ecosystem. What do you think about this?

How about those traditional payment processors will be adopting bitcoins and other cryptos as part of their payment options? In my opinion, this is what most probably going to happen as it will ease survival of those traditional payment processors in the new crypto era. Already we heard that visa and mastercards started working with bitcoins and in near future all payment processors may join them for some reasons.

Still, I agree that those traditional payment processors may not remain as successful as they were. This way some processors may stop their services after unable to compete against revolution of cryptos.