El Salvador abandons Bitcoin as legal tender

IMF gave them 1.4 billion to abandon the “experiment”:

> The IMF made this a condition for a loan of 1.4 billion US dollars (1.35 billion euros). In December of last year, the IMF reached an agreement with President Nayib Bukele’s government on the loan of the stated amount to strengthen the country’s “fiscal sustainability” and mitigate the “risks associated with Bitcoin,” as it was described.

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I dislike cryptocurrencies as much as the next guy but this was clearly something else than a failure of the currency itself

Despite that interference, from everything I’ve read though it’s hard to describe the bitcoin experiment as anything else than a massive failure…

Yeh, it failed so hard no one even uses it anymore.

Are you able to point to a single case where Bitcoin was used as legal tender in an every day business transaction? By this I mean, can you give an example where someone ordered a cup of coffee with Bitcoin directly and not through a proxy?

100% this.

Food, medicine, transportation, education, and everything else at or near the bottom of Maslow's pyramid of needs still cannot be directly purchased with bitcoin.

The other punchline to the Bitcoin joke is that it's finite. In 120 years it will begin to evaporate from existence as more and more wallets are simply lost to time.

It is highly divisible though, there’s 2.1e15 satoshi and 2.3e14 cents in the world (re google). It can lose 90% of itself before being unable to replace cents. Also, the network can just agree to change the protocol to fix this issue, should it arise. Countries do redenominations all the time.

Why would the people who are getting richer and richer by hoarding btc and not engaging in anything productive ever agree to that?

> Countries do redenominations all the time

That’s not really the same, in several fundamental ways.

I mean, what I'm about is really the same, just the other way round. Countries usually erase zeroes after hyperinflation adds them, cryptocoins can just add extra zeroes due to deflation. No change in value, just higher granularity.

The rest left me puzzled, can you elaborate? Why should the money holder do anything productive? Why getting richer and richer becomes something bad when we go crypto?

> Why getting richer and richer becomes something bad when we go crypto?

Is that sarcasm? It discourages any type of economic activity.

Why would someone invest into or try to start a business when you can become richer by just sitting on your money pile with no risk.

Artificially constricting the supply of money in a non static economy is a bad idea. Like the gold standard just much worse.

Because starting a business might still lead to higher returns for you than hoping that your money will be worth more.

One thing i’ve always wondered: If something like Bitcoin was the only currency, then it would be like a direct mapping of 21 Million Bitcoin <-> all global economic activity and goods and services. In that case, shouldn’t its price be relatively stable, and might actually even go down sometimes? Like in big natural disasters increasing the cost of certain goods?

I’m not a crypto zealot, but I’m not a big believer in the idea that the economy needs to be stimulated and I need to be forced to spend my money before it loses its value. I just want to buy what I need or really want.

And in the hypothetical case of having a mapping of “all economic activity” <-> “21M payment units”, then the relative stability of this money might still make investments more lucrative than just hoping for my money to be worth slightly more tomorrow. In this hypothetical scenario it would be more like “my money is worth 1000 eggs today, next month it might be 1001 (if others grow the economy) or 999 (if something unforeseen happens halfway across the globe). So if an investment looks like it might yield the value of 1100 eggs there would still be people to take the risk of investing, no?