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El Salvador abandons Bitcoin as legal tender

(ticotimes.net)
927 points smallerfish | 5 comments | 04 Feb 25 00:00 UTC | HN request time: 0.265s | 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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codethief ◴[04 Feb 25 01:39 UTC] No.42926355[source]▶
> Speculative asset class fails as non-speculative legal tender class.

This. Bitcoin proponents often claim that eventually everyone will use Bitcoin for payments ("Finally no more governments or central banks!") and that's why it will increase in value, so everyone should invest in BTC.

But this argument is fundamentally flawed: A currency, in order for it to work (in order for people to be able to trust it), needs to be stable in value. Which contradicts it being an investment vehicle and drastically varying in value over time.

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aydyn ◴[04 Feb 25 02:24 UTC] No.42926867[source]▶
What currency is stable in value? Certainly not the U.S. dollar.
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mystified5016 ◴[04 Feb 25 02:44 UTC] No.42927043[source]▶
The USD doesn't frequently lose all or nearly all value as we see from cryptocoins. My $10 today will be worth $10 tomorrow barring nuclear war or an apocalypse.
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aydyn ◴[04 Feb 25 03:13 UTC] No.42927339[source]▶
Sure but the USD has two order of magnitude more total value, and probably more than that in day to day usage.

So there's an implicit question there which apparently you and everyone else missed.

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acdha ◴[04 Feb 25 03:32 UTC] No.42927503[source]▶
Why do you think the USD has so many orders of magnitude usage? Nobody missed the question, that was the point: for currencies, stability is what makes them useful. You don’t have an incentive to hoard dollars hoping they’ll go up in value, so you spend them and boost the economy. Other countries use dollars because they have the same benefit: I can write a contract with you saying what we’ll pay over the next year and be confident that neither of us is going to be widely inconvenienced by the kind of swings Bitcoin has.

Remember that guy who spent 100BTC on a pizza? It’s a funny story but that’s why nobody uses Bitcoin for normal transactions.

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1. aydyn ◴[04 Feb 25 04:20 UTC] No.42927892[source]▶
> Why do you think the USD has so many orders of magnitude usage? Nobody missed the question, that was the point: for currencies, stability is what makes them useful.

Hint: cause and effect. You did miss the point and still do probably.

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2. noirbot ◴[04 Feb 25 05:04 UTC] No.42928231[source]▶
Gotta love crypto people putting "looking smarter than you" over actually explaining what it is they mean. If you've got a point to make, don't just hint at it, say something and then we can have a discussion. This just makes you look petty and like you're only in it to stroke your own ego.
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3. aydyn ◴[04 Feb 25 09:07 UTC] No.42930038[source]▶
> Gotta love crypto people putting "looking smarter than you"

Oh I'm sorry, that was your shtick. Apologies!

Also, I'm not a crypto person, I made some gains and sold a long time ago. I just have to laugh that you think one pointing out that an argument is weak makes one a part of the opposite tribe.

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4. acdha ◴[04 Feb 25 18:12 UTC] No.42936332[source]▶
Can you share the point you think people are missing?
5. noirbot ◴[04 Feb 25 18:35 UTC] No.42936663{3}[source]▶
Then maybe you should explain the point you're trying to make instead of just hinting at it?

I didn't even specify if I thought you were pro or anti crypto - I just find that most conversations around crypto are dominated by statements of "the other side of this just doesn't understand basic facts like I do" instead of actually stating what the facts are and how they apply to the situation that would help someone learn what's being discussed.

I may very well be the stupid one here, and you may be quite a bit smarter than me, but I don't know because I still don't know the point you're hinting at making.