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El Salvador abandons Bitcoin as legal tender

(ticotimes.net)
927 points smallerfish | 4 comments | 04 Feb 25 00:00 UTC | HN request time: 0s | source
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Mengkudulangsat ◴[04 Feb 25 00:11 UTC] No.42925325[source]▶
> The government, she assured, will continue buying bitcoin and having reserves in this cryptocurrency

Sounds like the term "Failed Experiment" is the writer's assertion and not the government official position.

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cwillu ◴[04 Feb 25 00:26 UTC] No.42925524[source]▶
“Another change makes using bitcoin entirely voluntary. (Previously, the law mandated that businesses accept bitcoin for any goods or services they provided.) Additionally, bitcoin can no longer be used to pay taxes or settle government debts.”

--https://reason.com/2025/02/03/el-salvador-walks-back-its-bit...

Sounds pretty failed to me.

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desumeku ◴[04 Feb 25 00:29 UTC] No.42925557[source]▶
They did this to receive a loan from the IMF. The IMF was withholding the loan because of BTC and would not disburse it until they got rid of its status as legal tender.
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Mengkudulangsat ◴[04 Feb 25 00:44 UTC] No.42925736[source]▶
Fair demand by the IMF.

Presumably they require their loan to be repaid in fiat because of their internal charter. If Bitcoin adoption eventually removes El Salvador's ability to issue fiat, their loan can't be repaid.

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1. hackernudes ◴[04 Feb 25 00:57 UTC] No.42925878[source]▶
El Salvador doesn't have a fiat currency. They are dollarized since 2001.
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2. Mengkudulangsat ◴[04 Feb 25 01:10 UTC] No.42926024[source]▶
Hmm.. I didn't know that. Which makes the demand purely political then. I recall IMF making the same demand from an island country a few years ago too.

https://www.imf.org/en/Blogs/Articles/2021/07/26/blog-crypto...

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3. mattnewton ◴[04 Feb 25 01:38 UTC] No.42926347[source]▶
The IMF feels bitcoin is a risky asset and doesn’t want to be a part of that gamble when making its loan. The IMF has a history of making lots of conditions they feel minimize risk.

To me it looks more like my bank mandating I carry certain kinds of insurance in the terms of my mortgage than a political bias, but I am not an expert.

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4. iforgot22 ◴[04 Feb 25 02:03 UTC] No.42926606{3}[source]▶
"urged officials to limit its exposure" is what the Reuters article said, so yeah. They think El Salvador's ability to repay the loan is tied too much to BTC.