IMF Sees Legal, Economic Issues With El Salvador Bitcoin Move 133
The International Monetary Fund said on Thursday it has a number of economic and legal concerns regarding the move from El Salvador to make bitcoin a parallel legal tender. Reuters reports: El Salvador has become the first country in the world to adopt bitcoin as legal tender, with President Nayib Bukele touting its use for its potential to help Salvadorans living abroad to send remittances back home. "Adoption of bitcoin as legal tender raises a number of macroeconomic, financial and legal issues that require very careful analysis," said Gerry Rice, an IMF spokesman, during a scheduled press briefing. "We are following developments closely, and we'll continue our consultations with the authorities." Rice said the Fund will later on Thursday meet with Bukele to discuss the bitcoin law. El Salvador is in discussions with the IMF seeking a near $1 billion program. Hours after his announcement, Bukele instructed the state-owned geothermal electric company "to put up a plan to offer facilities for Bitcoin mining with very cheap, 100% clean, 100% renewable, 0 emissions energy from our volcanos."
Of course it does (Score:3, Insightful)
Best endorsement possible. It's like CNN; do or believe exactly the opposite the whatever narrative you get from CNN and you'll be correct in all cases. Whatever policy upsets the IMF is the optimal policy; do that.
Re: Of course it does (Score:4, Insightful)
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Modding replacing commentary is what happens as soon as their argument shifts from "I think Bitcoin is a good idea because..." to "Gotta defend my speculative purchase of Bitcoin."
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It is probably the irrelevant mainstream media trolling that has prompted the down votes (and your comment defending it has received similar down votes). The rest of the content of both of your posts are relevant and are far less likely to cause down votes.
Meet the new boss (Score:2)
Same as the old boss. You can pray we don't get fooled again, but I doubt it. This is as good as any other reason to hate Bitcoin. All those switching costs for naught. So much damage in the process.
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Why was this modded down?
Because it's an idiotic post that jumps from "IMF sucks" to "bitcoin is good, actually" with no evidence or reason, and then drags CNN into it, also for no reason.
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You are correct (your on topic comments anyway), which is why I've been curious about how long government will allow crypto-currencies to be used for financial transactions because of their money laundering laws. I have worked at financial institutions (as a developer, so I'm not an expert in banking) and they do take responsibility to combat money laundering. It isn't just the client responsibility to fill out form 8300, the banks can get in trouble for not requiring it. Without organizations the governmen
IMF looks out for its own (Score:5, Insightful)
They probably haven't entirely made a decision on what to do about bitcoin, but they know it has the potential to disrupt the wealth of the people they care about.
Re:IMF looks out for its own (Score:5, Insightful)
As others here on slash dot have pointed out something is rotten in Denmark (or in this case I'll El Salvador). The theory is is there extremely corrupt ruling class is going to use this to aid with money laundering and to more easily control the value of the currency there subjects have, similar to a company script.
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I don't buy the money laundering argument. Bitcoin is perfectly traceable - every transaction is recorded for all eternity in the blockchain. Sure there are people on the internet who claim to be able to "tumble" the coins
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Bitcoin is prone to wild swings of value because of the limited take up so far.
Amazing how no matter how much uptake there is, its still the lack of uptake that is blamed for this.
The idea that bitcoin continues to have "limited take up" is such big nonsense that at this point I can only conclude that you KNOW you are full of shit right now, ie, you are being a dishonest fucking fuck, again.
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Re:IMF looks out for its own (Score:4, Insightful)
Saying things like crypto is only used for drugs and laundering just makes you look like a poorly informed fool.
He isn't really that wrong. It is believed that only about 2% of Bitcoin transactions are for criminal activity, but that doesn't consider the fact that only 1.3% of Bitcoin transactions come from merchants. The vast majority of the transactions are mere currency speculation. So for actual economic activity using Bitcoin as anything other than a speculative investment, criminal activity is still the primary use of Bitcoins when purchasing goods and services.
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Saying things like crypto is only used for drugs and laundering just makes you look like a poorly informed fool. People have been laundering money for thousands of years before bitcoin came along. You've heard of cash, property and diamonds right ?
Your argument is missing something: logic.
The fact that other articles have been used for money laundering is completely orthogonal to the question of whether bitcoin is used primarily for this purpose.
When it comes to actual transactions, not just speculation, bitcoin appears to be used mostly for money laundering, and for buying illegal goods.
Cash, property, and diamonds are all irrelevant to that statement.
If you think that statement is incorrect, by all means say so. But handwaving whataboutism isn't go
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Only a small fraction of crypto activity is for illegal transactions. The rest of it, because you can't make everyday transactions with it, is for uninformed doomed-to-crash speculation. The real problem for those of us who are not crypto speculators is that illegal use of crypto is NOT just for drugs and dope and laundering. Those you can do roughly as easily with wads of fiat cash.
No, what is truly evil about crypto is that anonymous transfers enable extortion in a way that fiat cash no longer can given m
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Bitcoin is owned only by a fraction of the population, and of those only a tiny minority uses it for actual payments. Most bitcoin affine folks around me have mostly daytraded, or they just hodl for the heck of it. A bitcoin just sitting in my wallet is ineffective, it may as well have been lost - same as with any currency. Therefore the statement "limited uptake" is a lot less far fetched than it seems at first glance. If people use crypto mainly as an asset hoped to rise in value, then prices will fluctua
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Bitcoin does have very limited uptake, if you look at it as a currency. What can you buy with Bitcoin? Who accepts it as payment? Not a lot.
The vast majority of Bitcoin transactions is pure speculation, and the speculators treat Bitcoin like a commodity or a stock and not like money.
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Yeah, they're a real player at world level. The world trembles every time El Salvador makes a decision. I bet you can even name their president...
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Most countries have their own currencies.
According to the ranking of countries by GDP, El Salvador is 104, just ahead of Iceland:
https://www.worldometers.info/... [worldometers.info]
There's 190 countries on the list, so 85 have smaller economies than El Salvador, and many of these countries have their own currencies.
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This argument only makes sense if you think that all currencies are equal.
And anyone who thinks that has not a faintest clue on basic economics.
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It's funny how you keep proving that you're very low on intelligence totem pole as you desperately troll slashdot as AC, without ever realising just how easily recognizible your writing style is. Where in my post did I ever say anything about El Salvador?
All I did was address OP's point that "many of the sovereign countries have their own currencies", which is only relevant to this discussion if those currencies are directly competitive with one another.
Truly, your masters are doomed if it's people of your
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Funny how you failed to comprehend anything I said in last two posts, even though it really doesn't require much to do so.
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I do admit I'm wrong in assuming you have mental faculties to even comprehend what we were talking about, making my replies basically talking to a wall.
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Most countries have their own currencies.
El Salvador doesn't. They switched to US dollars 20 years ago.
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Now I have a better idea of the sock puppet accounts. That sounds very familiar...
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El Salvador's government is a joke, and its military is a bad joke.
As a nation they have been shit on before, mostly by the USA [theatlantic.com]. The USA controls the world's dominant currency. You think this is going to simply pass by unnoticed? Nope.
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1. Means of Payment. Bitcoins are accepted almost nowhere, and some cryptocurrencies nowhere at all. Even where accepted, a currency whose value can swing 10 percent or more in a single day is useless as a means of payment.
2. Store of Value. Extreme price volatility also makes bitcoin undesirable as a store of value. And the storehouses — the cryptocurrency trading exchanges — are far less reliable and trustworthy than ordinary banks and
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Don't forget 4: transaction fees. It can cost anywhere from $5 - $50 to complete a bitcoin transaction. If you are paying an electric bill or something, that's an unacceptable percentage of the transaction.
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Interesting thing about El Salvador, is they use dollars as their national currency.
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Real currencies are stable because governments work to keep them that way. The US central bank, just like all the OECD countries, adjusts interest rates and the money supply to achieve a target inflation rate. China and several other countries (including El Salvador) (try to) peg their currency to the US dollar, plus or minus some margin.
Bitcoin doesn't fluctuate because of the absence of guns, it fluctuates because of the absence of all the controls and influences bitcoin boosters hate.
Re:IMF looks out for its own (Score:5, Insightful)
Bitcoin is prone to wild swings because it's a speculative tool of investment with no real world value beyond being hard to trace way to launder money. Be it as payment for ransomware decryption, or taking money out of systems with currency controls/sanctions.
That means that its value swings as various nations with currency controls putting new limits on bitcoin to real currency exchange and ransomware gangs getting hit, taking them temporarily offline.
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You've probably heard already, that illicit asset transfer makes up a tiny fraction of bitcoin transfers&trades. "Illicit asset transfer" is nothing but a tired attempt to discredit a novel technology, and we might as well let go of it eventually.
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I heard that among many other nonsensical lies from bitcoin proponents, like "negligible energy costs", ">50% attack against bitcoin is highly unlikely to be successful, please ignore the fact that it has already happened, scaring the shit out of people who accidentally did it who then broke up the relevant mining pool", "bitcoin mining pool is decentralized, please ignore that it lost a third of its hash rate when a single coal mine halted supply to three coal stations in Xinjiang" and my personal favou
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You claim, that a 50% attack actually happened, but there was no such attack. A 50% majority by a single entity indeed happened, but as you agree yourself, it was never used with malicious intent and was resolved in a cooperative manner before it could even turn into an attack.
Likewise you accuse me of lying about the amount of illicit activity, yet you bring no evidence to the contrary. Let me bring up some actual references: in the year 2019 many people would have agreed with you. According to this yahoo [yahoo.com]
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Your first point is "it didn't happen, yes it happened but I can do some playing with words to pretend that it sorta kinda didn't".
Your second point is also "it didn't happen, but it actually happened, but I can do some playing with words to pretend that it sorta kinda didn't".
Your third point is "it did happen, but I just don't care".
Funniest part of this discussion, I referenced a stereotypical bitcoin faithful and how their behaviour in relation to reality is just nonsensical wordplay. And you come in an
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My first point is "it didn't happen", because an attack actually requires malicious intent and an action pursuing this intent. Neither did happen. A potential for an attack was recognized, addressed and defused, before any damage could happen. Calling this an "attack" is dishonest at best, or "silly wordplay", if that's your preferred term.
Illicit activity is a tiny fraction of all bitcoin transactions, yet you paint it as a huge issue. Not only are there plenty and proven other means to store and transfer
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On first point, no it doesn't. 50% attack is a technical term, not an expression of intent. Not knowing this disqualifies you from any technical discussion on the subject, or IT security in general.
I already addressed your dodge on criminal activity and bitcoin above. You repeating the same dodge suggests that this is literally the only argument you have. Interesting.
Since your third is straight up admission, I'll simply take a win and ignore the silly wordplay you keep engaging in to pretend that this isn'
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Bitcoin itself is no more a public ledger than car is an engine.
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So you call the ability to commandeer 50% hash power an attack? Well, then you have a point, but you still have no point. You arguments so far focus on one situation, which was defused long before it could possibly cause harm, then about illicit activity, which comprises less than 1% of overall bitcoin activity, and an event which had no visible effect on bitcoin, even after it was publicly known. Hooray, you have three contrived points, which amount to a total of jack shit!
If this is all the ammo you can s
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The public, distributed ledger is what differentiates crypto from most other financial assets. All the apps and ecosystem written around it, all the exchanges and NFT trading platforms have already existed in kind without the public, distributed ledger.
And yes, if horse and oxen drawn carts are the norm, then the engine will be a major point of discussion, when automotive cars enter the scene.
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Internal combustion engine is what differentiates cars from horse pulled wagons. Roads and inns ecosystem already existed long before invention of the internal combustion engine.
Hint: you should really try to run your deeply religious rants by people who do not share you fanaticism before you post them online for everyone to see. As the old saying goes, "it's better to stay silent and let others think you an idiot than open your mouth and remove all doubt".
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I understand that you are utterly blinded by your religious fervour to not be able to even comprehend that "50% attack" is a technical term for having control over >50% of the mining capacity, granting you ability to alter the public ledger of bitcoin. Not an expression of intent of actually altering it.
The best part about it? You forgot all other arguments, and are now making an argument that just because criminal enterprises that utilize crypto are thriving with billions invested in them, it's a argume
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If you chose to define a "50% attack" as "ability to amass 50% hash power", then yes, there was such a "50% attack", and since it was resolved swiftly and without actual damage, nobody really cared. The only reason you care appears to be: "haha, there was a 50% attack, you are all dumb". The world still doesn't care and just keeps moving.
Also, I did not forget about the other arguments, it's just that you didn't bring anything to the table. You accused BTC to be a major crime facilitator. I showed, how this
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I'm not going to bother discussing technical terms with someone clearly unaware of their meanings.
But I will continue laughing about the fact that you yourself outed yourself as someone who sees increased criminality as a good thing because it benefits their object of worship, and then you proceeded to complain about me making the connection.
How precious indeed! Now you may live in a country where calling spade a spade is libel if spade takes offence to it. But I don't. So get bent.
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You whole argument about this "50% attack" hinges on the fact, that people consider "attacks" dangerous, aggressive and malicious. Once we look at the facts on the table, nothing much remains short of the dumb grin in your face.
You still pulled the other fact "increased use by criminals" out of your arse and without a shred of evidence, so please keep laughing while the rest of the world happily moves along.
Finally: if you claim here publicly, that calling me a criminal is "calling a spade a spade", you may
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If an entire country of regular users gets added, you'll find how how restrictive the transaction limit of the BTC network is.
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It's quite unlikely, that we will find out the transaction limit of the lightning network any time soon. Do not predict the downfall of some newfangled tech, unless you have really studied the topic in detail. Nobody really knows, where this BTC in El Salvador thing will go, whether and how it ends, but it will certainly not happen in the way you told us.
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It's gonna end up with BTC not really being used in country because close to no one in El Salvador actually has it and the merchants likely will massively prefer or outright refuse to accept BTC for goods as it's so volatile, not to mention the transaction time is usually minutes, not seconds.
That's the thing. Merchants in El Salvador will have no choice. El Salvador is very unusual in that they've made legal tender law changes in the very recent past. (2001, to be precise.) In El Salvador, at least historically, declaring something legal tender means merchants must accept it if it's offered, and must show prices in all legal tenders in the country (currently the US dollar and the colón, their old currency which is almost totally nonexistent at this point because it hasn't been printed
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Then you also have to realize basically no one in El Salvador is liable to have significant amount of BTC any time soon and it's not even sure yet if it's feasible for their "eco" mining to
Re: IMF looks out for its own (Score:1)
Re: IMF looks out for its own (Score:3)
It still wouldn't be just because you can pay your dollar dominated bills with it through real time conversion to equivalent bitcoin.
Price, wage and tax inertia help keep national currencies steady. The native price, wages and reported income for a major economy would need to be in Bitcoin.
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"Bitcoin is prone to wild swings and value. It's down something like 20 or 30%."
The dollar has lost 96% of its value since its inception. Bitcoin will very probably be worthless one day. Every fiat currency ABSOLUTELY will, without any doubt or question, one day.
Now, bitcoin could be worthless in a year (probably not), and most fiat currencies probably have longer than that. But fact that a unit of scarcity, not pegged to anything, could become so very desired because it can (a) be traded electronically
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"Heat death of universe is coming, therefore nothing matters."
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So what's the problem with bitcoin? It's still volatile. Mostly in a good way for holders, but very recently not so much. Yes it will always be volatile (even if it gets a bitcoin military
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I will assume you mean BTC is down against USD. Since when though?
Frequently, the answer is "Since 6 hours ago." Swings of 10% within one day have been the norm lately.
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Normal Forex traders take a position and hold it for a while. but crypto traders are convinced their toy algorithms can outsmart the market. Any minor change becomes a signal to buy or sell. It isn't. Just hold your position and ignore the fluctuations and you can treat it like any other commodity. If you can't hold a position without pa
Re: IMF looks out for its own (Score:2)
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Re: IMF looks out for its own (Score:2)
They don't want the loan to be wasted on making preparations to build power plants to give this pump and dump scheme more credibility.
There's good reason private investors use mothballed coal power plants ... making a massive investment with decades of earn back for Bitcoin mining is stupid.
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or negligence resulting in a 300 million euro payout (Christine Lagarde) https://money.cnn.com/2016/12/... [cnn.com]
And that's just the managing directors. Dig deeper and it's a cesspool all the way down.
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What? No rich person has anything but walking around money in currency, and what they do have is borrowed anyway.
What could possibly go wrong? (Score:5, Funny)
Legal Issues (Score:5, Insightful)
We're about to find out if El Salvador is a sovereign nation state or not.
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How so?
More fascinating to me is that El Salvador is a dictatorship and BTC shills acting like this announcement is a good thing for "freedom" without mentioning that it was the dictator's idea in the first place. This should be raising all the red flags for anyone who really believed BTC would somehow help oppressed peoples.
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Re: Legal Issues (Score:2)
That's really hard to say.
I mean dudes might arrive in black SUVs. Or MS-13 might start finding itself well armed. Or maybe violent grass roots protests. Or maybe the power will go out. Perhaps we'll start hearing about some great, wealthy Salvadoran who is charismatic and pro-American. Anything could happen.
Re:Legal Issues (Score:4, Insightful)
> How so?
If El Salvador is a sovereign nation, then they can do this silly thing with bitcoin and no one will fuck with them.
If in fact the IMF is warning them, then you'll soon see extreme economic measures being applied to El Salvador. Possibly they will call Nayib Bukele, who won a general election in 2019, a "dictator".
In fact, here is his wikipedia page, it doesn't call him a dictator yet, maybe you should fix that?
https://en.wikipedia.org/wiki/... [wikipedia.org]
If they are not REALLY a sovereign nation, then you will see that they will not be permitted to do the thing that they want to do.
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You can be a "sovereign nation" and still not get to do whatever you want to do, because you're not the only "sovereign nation" around. Kind of like you can be a free person and still not get to do whatever you want to do.
Re: Legal Issues (Score:2)
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Who's the villan? (Score:5, Funny)
If the IMF goes in and screws everything up then I guess The Secretary will disavow any knowledge of their actions.
Oh boy... (Score:2)
Freedom is coming to El Savador.
DeFi = DeCentratlized or DeRegulated Finance? (Score:1)
... or both?
A lot of proponents claim decentralization is somehow better, because it means no single group/entity exerts too much (or the only) control.
However there's a clear downside to that: lack of proper regulation. While a lot of people might oppose regulation, it exists in the current financial system for a reason, and does serve a purpose: to propect "regular people" (or what the cryptoenthuiasts likely troll about as "the financially clueless weaklings") from losing their shirts at the hands of man
excellent (Score:3)
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And how do we know this move isn't actually a honeypot endorsed by Uncle Sam?
The three letter agencies and their international affiliates may well be monitoring anyone who decides to take a vacation and pay with BTC. In the meantime, should El Salvador become awash with filthy lucre, the US doesn't need to spend as much of their citizens' taxes on foreign aid to the nation.
IMF can.... (Score:1)
I guess we could find out (Score:2)
Legal Issues? The IMF? (Score:1)
Volcano Lair (Score:2)
Dictator declares his imaginary money "legal tender" and then insists on a volcano headquarters where he can make more.
Paging James Bond to the white courtesy phone.
Volcanic erruption... (Score:1)