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El Salvador abandons Bitcoin as legal tender

(ticotimes.net)
927 points smallerfish | 1 comments | 04 Feb 25 00:00 UTC | HN request time: 0.215s | source
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portaouflop ◴[04 Feb 25 02:07 UTC] No.42926658[source]▶
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

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dragonwriter ◴[04 Feb 25 04:41 UTC] No.42928058[source]▶
If you need to go to the IMF for a loan of ~3% of your GDP to mitigate the risks associated with Bitcoin, well, that's a pretty good sign that adopting Bitcoin as legal tender was a pretty disastrous failure.
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willmadden ◴[04 Feb 25 05:43 UTC] No.42928498[source]▶
What are you talking about? Their Bitcoin holdings more than doubled in value.
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hagbarth ◴[04 Feb 25 06:15 UTC] No.42928708[source]▶
Would that not be a bad thing when using it as legal tender? Deflation tends to be disastrous for the economy.
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floydnoel ◴[04 Feb 25 12:56 UTC] No.42931726[source]▶
deflation is fine for an economy. inflation is disastrous for an economy. the people in charge of the money printers are trying to keep you confused. don’t buy it.
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llamaimperative ◴[04 Feb 25 13:00 UTC] No.42931768[source]▶
LOL

I have $1,000.

I believe that tomorrow, my $1,000 will be worth $2,000.

Why would I ever spend my money?

Hence, economy freezes.

This is so plainly obvious to everyone except crypto zealots I literally gasped seeing your comment.

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1. derangedHorse ◴[05 Feb 25 22:31 UTC] No.42956281[source]▶
That 'LOL' comes across as very arrogant for someone who seems to have a tentative grasp at best on what they're commenting on. We have already experienced stagflation which runs counter to a lot of Keynesian ideas about inflation. It turns out it doesn't always encourage spending and employment. Similarly there is no evidence deflation will lead to stagnation of productivity[1]. People will always want to spend more than is needed for survival and doing so in a deflationary environment makes people think harder on how money is spent.

[1] Read this for a more comprehensive view of deflation from an economist who lived through it: https://www.amazon.com/Economic-Changes-Production-Distribut...