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El Salvador abandons Bitcoin as legal tender

(ticotimes.net)
927 points smallerfish | 3 comments | 04 Feb 25 00:00 UTC | HN request time: 0.748s | source
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ggm ◴[04 Feb 25 00:12 UTC] No.42925329[source]▶
Speculative asset class fails as non-speculative legal tender class.

If king for the day with a sovereign wealth fund I wouldn't forbid investment choices like this on risk grounds, I mean you need risk assets as well as boring ones, right? But I have problems with the moral quality: it's like state investing in the casino business. Monaco? works fine. Anywhere else? It's got problems.

Like a lot of people, I probably fall into severe errors which would be bread and butter for "bad economics" reddit groups but truly, I can't see how this wasn't forseen and expected. It was about WHEN, not IF.

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Terr_ ◴[04 Feb 25 00:51 UTC] No.42925821[source]▶
> sovereign wealth fund

That reminds me of Hong Kong, where I used to live and which maintains a large sovereign wealth fund to ensure its currency is pegged to the US dollar.

While various US think tanks ranked it well on their checklists of "economic freedom", they tended to gloss over the rest of the recipe that made it work. Not just the huge sovereign wealth fund, but also how half the housing is government-run or subsidized and you don't really own land, you just rent it for a very long term from the government.

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1. bawolff ◴[04 Feb 25 01:15 UTC] No.42926080[source]▶
> That reminds me of Hong Kong, where I used to live and which maintains a large sovereign wealth fund to ensure its currency is pegged to the US dollar.

That doesn't sound like a soverign wealth fund. Foreign currency reserves are not the same thing as a soverign weath fund.

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2. Terr_ ◴[04 Feb 25 01:45 UTC] No.42926408[source]▶
I'm not sure what you're reacting to here, I never said it was just US currency reserves. (Those are a component, sure, but that's hardly abnormal.)

> The Exchange Fund of Hong Kong is the primary investment arm and de facto sovereign wealth fund of the Hong Kong Monetary Authority.

https://en.wikipedia.org/wiki/Exchange_Fund_(Hong_Kong)

It's also 10th-largest on:

https://en.wikipedia.org/wiki/Sovereign_wealth_fund#Largest_...

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3. FabHK ◴[04 Feb 25 03:10 UTC] No.42927308[source]▶
HK has a currency pegged to the USD via a currency board, that is (similar to a stable coin) backed one-to-one with USD denominated short-dated treasuries. That is within the HK exchange fund operated by the HK Monetary Authority.

The exchange fund also (and somewhat controversially) runs additional portfolios (with foreign shares and bonds, and private equity, real estate etc.) in the manner of a sovereign wealth fund.