Cryptocurrencies (Bitcoin, Ethereum, Litecoin, etc.)

[XYZ 2154]

I’m not really seeing what making BTC legal tender is going to do for El Salvador, other than look cool. Are they planning to supplant their local currency with it? I very much doubt that.

[Nice Guy Eddie 13512]

2 minutes ago, XYZ said:

I’m not really seeing what making BTC legal tender is going to do for El Salvador, other than look cool. Are they planning to supplant their local currency with it? I very much doubt that.

They don't have local currency. US Dollars are their other official currency.

[Satoshi 129]

6 minutes ago, XYZ said:

I’m not really seeing what making BTC legal tender is going to do for El Salvador, other than look cool. Are they planning to supplant their local currency with it? I very much doubt that.

Making it legal tender eliminates capital gains tax when you spend it. I think they hope that will spur investment. Also, the more their population uses or interacts with it then the more likely they are to use it for receiving remittances which are a huge part of their economy. If you eliminate the 10-20% fees for remittances from funds being received from the US then that’s an overnight boom for these people. 

[XYZ 2154]

5 minutes ago, Nice Guy Eddie said:

They don't have local currency. US Dollars are their other official currency.

Yeah, I mean, I never understood how countries like El Salvador or Costa Rica get by without having their own printing press. Still, the BTC is gonna have to come from somewhere. I don’t see what problem BTC solves for them.

[XYZ 2154]

21 minutes ago, Satoshi said:

Making it legal tender eliminates capital gains tax when you spend it. I think they hope that will spur investment. Also, the more their population uses or interacts with it then the more likely they are to use it for receiving remittances which are a huge part of their economy. If you eliminate the 10-20% fees for remittances from funds being received from the US then that’s an overnight boom for these people. 

It costs 10-20% to send money?

[bernorange 8361]

A large percentage of their population is unbanked.  They don't have bank accounts.  They want to help expats send wealth back home.  So the cook at your favorite restaurant can send money back home to family in El Salvador (for example).

[washparkhorn 9939]

10 hours ago, bernorange said:

A large percentage of their population is unbanked.  They don't have bank accounts.  They want to help expats send wealth back home.  So the cook at your favorite restaurant can send money back home to family in El Salvador (for example).

https://medium.datadriveninvestor.com/a-bitcoin-story-banking-the-unbanked-in-el-salvator-central-america-b0a4ebaa8820

Good story about Bitcoin Beach in El Salvador - a micro-economy where crypto became the unofficial legal tender. 

[Nice Guy Eddie 13512]

I do see scenarios where the poor get hurt by bitcoin adoption. Going from bank less to being your own banker creates new risks that we may not realize. Some basic chain analysis could let a local gang know how much bitcoin you have or if you’re hiding it in other wallets.

[XYZ 2154]

15 hours ago, bernorange said:

A large percentage of their population is unbanked.  They don't have bank accounts.  They want to help expats send wealth back home.  So the cook at your favorite restaurant can send money back home to family in El Salvador (for example).

So what you’re saying is that the cook somehow converts some of his USD to BTC, transfers the BTC to the family in El Salvador, and the family can spend the BTC in groceries or whatever.

[Satoshi 129]

2 hours ago, Nice Guy Eddie said:

I do see scenarios where the poor get hurt by bitcoin adoption. Going from bank less to being your own banker creates new risks that we may not realize. Some basic chain analysis could let a local gang know how much bitcoin you have or if you’re hiding it in other wallets.

There are safety concerns with receiving cash from Western Union as well. 

One quarter of GDP is remittances. Pretty astounding. If their gdp is $25B and you can bring 400M more in by cutting out fees then that is significant.  Especially since that is money directly in people’s hands. 
 

27 minutes ago, XYZ said:

So what you’re saying is that the cook somehow converts some of his USD to BTC, transfers the BTC to the family in El Salvador, and the family can spend the BTC in groceries or whatever.

It’s handled via apps like Strike. When they send USD it’s instantly converted to BTC for transfer over the bitcoin network. It’s sent to a node there in El Salvador where it’s instantly converted back to USD. Strike negotiates who handles the currency exchanges for them, but it’s nothing the consumer is even aware of. The whole process happens in seconds so no exchange risk. You can switch currencies however you want. Here’s an example going from usd to Naira in Nigeria. 
 

So what can get confusing is the distinction between the asset and the network. The asset is Bitcoin which people hodl or transact with over the bitcoin network via Lightning.

I would argue Strike is essentially the first “killer app” built using the Bitcoin network. 

[Satoshi 129]

Here’s another way that it’s utilized in El Salvador today. 

 

[The Royal We 3072]

Good stuff, thank you for sharing.  The benefits of BTC to these people is not hard to see - just look at a Western Union fee chart (especially on small amounts) to see how hard they are fucking people:

https://www.westernunion.com/content/dam/wu/EU/EN/feeTableRetailEN-ES.PDF

Hopefully this technology makes them go the way of the Dodo.

Edited September 9, 2021 by The Royal We

[XYZ 2154]

I guess Western Union is gonna have to lobby for this outrage to be stopped.

[washparkhorn 9939]

BTC holding that 44 line. 

Is this just temporary dollar strengthening?

[Satoshi 129]

Some speculation here, but interesting that the Ukrainian President has been in Silicon Valley. 
 

 

[Satoshi 129]

Whole market pumped and dumped on good looking fake news release claiming Walmart was accepting Litecoin. It’s funny because it was absurd on its face. 

[Satoshi 129]

A couple interesting tidbits tonight. 
 

From the same account, I’ll have to check back and see who this is. 
 

 

[Satoshi 129]

Spoiler

Through its recent legal threat against Coinbase’s new interest-bearing cryptocurrency account program, the Securities and Exchange Commission has created a stir in both finance and tech — two worlds that have always been intertwined, but because of the implications of digital technology itself, now face each other in a deepening rivalry. Industry watchers now expect the Biden administration to go on regulatory offense against cryptocurrency.

What is at stake is far more serious than the mainstreaming of cryptocurrency. Facilitated by technology, financial companies’ expansion into our private lives threatens to herd Americans into a de facto social credit system that punishes them for making choices — and even voicing opinions — that the people at the controls don’t like.

At a breakneck pace, consumer finance is becoming irreversibly embedded in digital technology. A new McKinsey survey showsover three-fourths of Americans use some type of digital payment platform. By next year, according to Statista, around two-thirdsof Americans are expected to use digital banking. Increasingly, one participates in the economy at the pleasure of those running its infrastructure, giving those in charge of that infrastructure tremendous power to shape and punish behavior. They are taking advantage.

In recent months, we’ve seen payment processors, web hosts and other corporations brazenly take coordinated action in lock-step with government priorities to financially freeze out disfavored businesses online. The elimination of a sitting president from social media, whatever its perceived merit or rationale, opened the door to a regime where those who can cancel and suspend accounts do so at whim and in unison. This logic has led directly from one payment platform, Stripe, zapping away Donald Trump to a much bigger one, PayPal, blacklistingcustomers to purify its user base.

 

Feeding the beast makes it stronger: The more power these organizations wield, the more arbitrary and punitive their ethical or ideological standards become. As PayPal’s founding COO David Sacks has warned, the orchestration of interlocking federal, financial and technological power to punish its critics and perceived opponents circumvents our core constitutional protections: A person who finds his financial and social media accounts shuttered after being identified as a subversive by the government will have no legal recourse.

Thanks to its huge resources, spanning Silicon Valley and federal government, the regime has deep knowledge of your activity online. Think, say and do what it wants, and you are allowed to function. Deviate, and you are shut down. This is the un-American logic of the social credit system being imposed on us.

Without a fundamentally new and better way to generate, circulate, save and exchange wealth, Americans will be increasingly powerless to prevent their financial system from being used to transform their country into a technological cage.

Bitcoin and similar cryptocurrencies can free ordinary Americans from the financial and psychological discipline and punishment at the core of this system of control. But this gift will disappear if policymakers and legislators, beginning at the state level, don’t firmly establish regulatory and statutory impediments to the combined efforts of Washington, Wall Street and Silicon Valley to make cryptocurrency just another cog in the system they control.

States need to become broad legal sanctuaries for cryptocurrency. The use of digital technology to refound America as a soft social credit system can be stopped only by placing digital power in the hands of the people. For generations, our military and intelligence agencies have progressively organized America’s technological advancement around unaccountable and extralegal social control. Our dependence on this system for future innovation exacts an unbearable price on our freedom and our flourishing.

 

Antitrust action against behemoth firms like Google and Amazon is wise and just, but doesn’t return digital agency to regular citizens and enshrine it into law. The fast-emerging social credit system erases the line between private and public; Americans need Bitcoin and the like in order to take back their destinies in the digital world instead of entrusting it to more private or public sector overlords.

The critics have had a field day with cryptocurrency, and, at its worst, it earns the caricatures. But this is because, like all tools, it can be turned against its best use. For the architects of the social credit system, it’s essential that the amount of new crypto mined is sharply limited, that crypto transactions are heavily monitored and capped, and all forms of crypto are incorporated into the single regulatory and investment environment controlled by Washington, Wall Street and Silicon Valley.

Americans need just the opposite: the right to produce and buy computers powerful enough to mine Bitcoin and build data centers; the right to use and move cryptocurrency free from invasive monitoring, reporting requirements and arbitrary restrictions; and the right to freely choose to use cryptocurrency as true digital currencies among themselves. Federal laws to this effect would be ideal, but in the current hostile environment, the urgent place to begin is at the state level.

Without these laws, Americans will lack the digital power necessary to escape the coming social credit system. There’s no Plan B if lawmakers can’t protect Americans’ digital rights. 

 

James Poulos (@jamespoulos) is executive editor of The American Mind and a fellow at the Center for the Study of Digital Life. He is the author of “The Art of Being Free” and the forthcoming “Human, Forever: The Digital Politics of Spiritual War.”

 

[bernorange 8361]

I was surveying headlines about El Salvador and Bitcoin this morning.  Without digging into details (ie. just reading headlines) I see that:

- El Salvador's Court of Accounts will be investigating how the government makes its Bitcoin purchases, following complaints.

- El Salvador's adoption of bitcoin as legal tender has immediate negative implications for it credit rating S&P Global said on Thursday.

- El Salvador bond spreads to U.S. Treasuries hit a record high on Thursday on growing investor fears the Central American nation will not reach a potential $1 billion loan agreement with the International Monetary Fund and faces negative credit implications linked to its use of bitcoin.

Seems like the big boys in the markets are still applying pressure on El Salvador.  But then I see this nugget:

Quote

El Salvador has installed its Chivo bitcoin ATMs across the US to make remittances cheaper for Salvadorans living abroad

...
El Salvador has installed its Chivo bitcoin ATMs in cities across the US to make it cheaper and easier for people to send money to their family and friends who live in the world's first country to make bitcoin legal tender.

There are 50 commission-free Chivo ATMs in 10 cities in the US, locations where local legislation permit the machines, said El Salvador President Nayib Bukele said on tweets posted this week.
...
... according to figures cited by The Block ... remittances from the US in 2018 made up 21% of El Salvador's GDP and that Bukele has estimated Salvadorans spend $400 million a year on remittance fees.

Chivo members can make withdrawals and recharge accounts at the ATMs and can use the wallet app to send either bitcoin or US dollars to people in El Salvador. People have usually used services such as Western Union to send money digitally from abroad for cash to be picked up.

Locations for Chivo ATMs include Atlanta, Chicago, Dallas and Los Angeles, Bukele said in a tweet.

https://markets.businessinsider.com/news/currencies/el-salvador-bitcoin-chivo-atms-cryptocurrency-remittances-money-bukele-2021-9

I don't think El Salvador is going to back down.

[workswithseed 2103]

17 minutes ago, bernorange said:

I was surveying headlines about El Salvador and Bitcoin this morning.  Without digging into details (ie. just reading headlines) I see that:

- El Salvador's Court of Accounts will be investigating how the government makes its Bitcoin purchases, following complaints.

- El Salvador's adoption of bitcoin as legal tender has immediate negative implications for it credit rating S&P Global said on Thursday.

- El Salvador bond spreads to U.S. Treasuries hit a record high on Thursday on growing investor fears the Central American nation will not reach a potential $1 billion loan agreement with the International Monetary Fund and faces negative credit implications linked to its use of bitcoin.

Seems like the big boys in the markets are still applying pressure on El Salvador.  But then I see this nugget:

https://markets.businessinsider.com/news/currencies/el-salvador-bitcoin-chivo-atms-cryptocurrency-remittances-money-bukele-2021-9

I don't think El Salvador is going to back down.

The Savior is a heck of a name for a country praying this will pay off.

[Satoshi 129]

2 hours ago, bernorange said:

I was surveying headlines about El Salvador and Bitcoin this morning.  Without digging into details (ie. just reading headlines) I see that:

- El Salvador's Court of Accounts will be investigating how the government makes its Bitcoin purchases, following complaints.

- El Salvador's adoption of bitcoin as legal tender has immediate negative implications for it credit rating S&P Global said on Thursday.

- El Salvador bond spreads to U.S. Treasuries hit a record high on Thursday on growing investor fears the Central American nation will not reach a potential $1 billion loan agreement with the International Monetary Fund and faces negative credit implications linked to its use of bitcoin.

Seems like the big boys in the markets are still applying pressure on El Salvador.  But then I see this nugget:

https://markets.businessinsider.com/news/currencies/el-salvador-bitcoin-chivo-atms-cryptocurrency-remittances-money-bukele-2021-9

I don't think El Salvador is going to back down.

Agreed. The elimination of fees from these remittances is essentially a direct economic stimulus to these people. Once they learn how to use it, why go back?

[workswithseed 2103]

So, Bitcoin is taking hits.

[txhorns 2409]

12 minutes ago, workswithseed said:

So, Bitcoin is taking hits.

It's not for the short term weak hearts.

[workswithseed 2103]

20 minutes ago, txhorns said:

It's not for the short term weak hearts.

Definitely buy the dips.

[Satoshi 129]

46 minutes ago, workswithseed said:

So, Bitcoin is taking hits.

Every market is tanking. Taking the air out of bubbles a bit. Just means authorities will proceed to pump further. Fed may announce intent to taper but will not last long. You need a little dump occasionally but then Money printer go brrrrrrrrrr

[Chewy's Hairy Horn 868]

26 minutes ago, workswithseed said:

Definitely buy the dips.

Definitely been a blue light special kind of day. 

 

Edited September 21, 2021 by Chewy's Hairy Horn

[Satoshi 129]

 

[Satoshi 129]

This pretty cool. As of today sending money through Twitter instantly is enabled via an API on the Lightning network. 
 

 

[workswithseed 2103]

6 hours ago, Satoshi said:

This pretty cool. As of today sending money through Twitter instantly is enabled via an API on the Lightning network. 
 

 

Reading the thread, I couldn't tell if it costed him $15 to send $10 or what?

[Satoshi 129]

3 minutes ago, workswithseed said:

Reading the thread, I couldn't tell if it costed him $15 to send $10 or what?

10 to send 10

[Laxtonto 12080]

China looks like they are banning all crypto transactions. 
 

 

Things are going to be really volatile 

[The Royal We 3072]

China has been "banning" crypto for 5+ years.  Here's a headline from 4 years ago:

 

[Satoshi 129]

1 hour ago, Laxtonto said:

China looks like they are banning all crypto transactions. 
 

 

Things are going to be really volatile 

This is 100% the approach to take. China is ceding the entire cryptocurrency realm outside of their CBDC to the western world. If we really take the lead it will be a big tech advantage for us going forward. 

[washparkhorn 9939]

China's actions re crypto suggest the CCP is fearful of capital flight.  Volatility remains a feature of crypto. 

[Laxtonto 12080]

7 minutes ago, Satoshi said:

This is 100% the approach to take. China is ceding the entire cryptocurrency realm outside of their CBDC to the western world. If we really take the lead it will be a big tech advantage for us going forward. 

I am not sure that we have the whole picture of what is going on right now politically at the upper levels right now internally in China. In the last month we have seen an almost complete ban on online gaming for the youth (I think it is now down to 3 hrs a week), the shutdown of cyrpto (again...), the what looks like the takeover of Evergrande, and massive misses on their own cooked GDP projections. This is on top of their continued war on various internal tech options and their upper wealthy elite.

 Either they have come to grips that it is inevitable that their self-made economic bubble is going to pop and they have decided enforce cultural measures to help prepare or something else is in the works. If you reduce online gaming it in effect also dampens one of the few ways that there is online discussion about topics. Cutting crypto helps them to lock in their own internal price points with no functional substitutions. And now they are about to nationalize their largest real estate holder...

It is almost like they are looking at an even harder push away from person property and property rights and are closing off more potential avenues of dissent and shutting down ways to do "elicit" person property transactions as well. With financial transactions already heavily monitored within China and now there isn't an option outside of their current model to do anything else... 

Something just seems "off" and it makes it that much harder to predict what this means for global markets.

[washparkhorn 9939]

19 minutes ago, Laxtonto said:

I am not sure that we have the whole picture of what is going on right now politically at the upper levels right now internally in China

I enjoyed your post.

On the grand master chessboard I watch, China is attempting to carve out an economic sphere under its exclusive control. The US says no. The rest of the world is picking sides.

China cannot afford capital flight at this point in the big game. 

[Satoshi 129]

38 minutes ago, washparkhorn said:

China's actions re crypto suggest the CCP is fearful of capital flight.  Volatility remains a feature of crypto. 

Capital flight is a part of it. I also think they want to eliminate access to all perceived competition to their digital Yuan. Much like some of our regulators and legislators like Liz Warren, they seem to think that a CBDC is the only useful implementation of cryptocurrency and anything else is competition. But they have very little in common with Bitcoin and even less in common with some of these smart contract platforms. 
 

38 minutes ago, Laxtonto said:

I am not sure that we have the whole picture of what is going on right now politically at the upper levels right now internally in China. In the last month we have seen an almost complete ban on online gaming for the youth (I think it is now down to 3 hrs a week), the shutdown of cyrpto (again...), the what looks like the takeover of Evergrande, and massive misses on their own cooked GDP projections. This is on top of their continued war on various internal tech options and their upper wealthy elite.

 Either they have come to grips that it is inevitable that their self-made economic bubble is going to pop and they have decided enforce cultural measures to help prepare or something else is in the works. If you reduce online gaming it in effect also dampens one of the few ways that there is online discussion about topics. Cutting crypto helps them to lock in their own internal price points with no functional substitutions. And now they are about to nationalize their largest real estate holder...

It is almost like they are looking at an even harder push away from person property and property rights and are closing off more potential avenues of dissent and shutting down ways to do "elicit" person property transactions as well. With financial transactions already heavily monitored within China and now there isn't an option outside of their current model to do anything else... 

Something just seems "off" and it makes it that much harder to predict what this means for global markets.

You see a lot online about how they’re trying to  “curb speculation”.  It feels to me like they’re trying to rein things in before conditions Get a little rough in China. Xi consolidating power before he can be threatened? There’s news of looming blackouts and food shortages. Not good for stability. 
 

fwiw Malmgren is an interesting geopolitics/economics follow. Experience in multiple administrations going back to Nixon I believe. Smart man. 
 

Edit- actually he goes back to Kennedy

https://en.m.wikipedia.org/wiki/Harald_Malmgren

Edited September 24, 2021 by Satoshi

[Satoshi 129]

3 hours ago, Laxtonto said:

China looks like they are banning all crypto transactions. 
 

 

Things are going to be really volatile 

The on chain newsletter I follow says throughout this latest dip that long term investors have continued buying. Predicts a decent supply squeeze coming similar to last fall. Hodl 

[Laxtonto 12080]

I’ve had a sneaking suspicion that the external saber rattling with Taiwan and the South China Sea lately has been to force away scrutiny at the internal political war going on at the highest levels of the CCP.
 

What I can’t figure out is what the “other” faction is after, beyond power itself. Are they wanting to go more progressive and the current moves are to curtail them or looking to push towards a move socialist view and these moves are a reflection of their gaining control.

I am starting to wonder if they know the rest of the world is getting close to push towards affixing blame of COVID fully at their feet and this is purely precautionary to have controls in place to help mitigate the chaos internally if that happened.

Way too much unknown with this, but something just seems off. When you see a tightly controlled internal system doing measures to further enhance the grip on its population, without a major external stimuli, you begin to question what is driving this and you don’t see the external piece, the only other option is internal.

[gsoda3 3257]

xi jinping has an interest in doing whatever he can to retain power as general secretary of the party.  there's a little over a year before he's supposed to handoff power but if you think he's going to do that i've got a bridge for ya.  he's working hard to consolidate every aspect of state around himself under the notion that he is the party is the state.  the digital yuan is a tool he desperately wants to have in his pocket to control funds going into, but more important out of, china.  

[XYZ 2154]

10 minutes ago, Laxtonto said:

I am starting to wonder if they know the rest of the world is getting close to push towards affixing blame of COVID fully at their feet and this is purely precautionary to have controls in place to help mitigate the chaos internally if that happened.

But do you think the West is actually moving in that direction? It doesn’t seem like the governments of Europe or the US are making much effort to nail China for the covid snafu.

[Laxtonto 12080]

2 minutes ago, XYZ said:

But do you think the West is actually moving in that direction? It doesn’t seem like the governments of Europe or the US are making much effort to nail China for the covid snafu.

And that is the part that I’m struggling with coming to grips with.  Unless the unrest in Australia is going to lead to the need to “place blame” on an outside actor to take some of the heat off their current administration, I don’t know who would be the first country to take action. It’s not like there aren’t a ton of governments that could use a “win” by pushing blame to the outcomes internally of their responses to COVID by following suit.
 

The issue isn’t if a country can find a way to justify blaming China for a global pandemic, it’s who would be willing to be the first one. And if it gains global traction and has positive impact at home, then others would follow until it becomes a fore gone conclusion that the rest of the world now has a scapegoat for all things tied to COVID.

The problem is the risk of what happens of the country pushes the claim and no body else follows suit and you are in an economic death spiral with China blacklisting you.

 

Thats why I struggle with saying that it’s a potential possibility, but it is probably smart to start exploring those types of lines of thought. The current moves don’t make a ton of sense as a whole, so something is going on…
 

[XYZ 2154]

It’s like China is circling the wagons.

[Laxtonto 12080]

15 minutes ago, XYZ said:

It’s like China is circling the wagons.

That is what I see too, but “Why” is the problem. If it is just Xi prepping to make sure he stays in power is one thing (most people assumed that was going to happen anyways) but if it is something else the impact on the markets will be much more drastic.

Time to wait and see I guess…

 

[Satoshi 129]

18 minutes ago, Laxtonto said:

That is what I see too, but “Why” is the problem. If it is just Xi prepping to make sure he stays in power is one thing (most people assumed that was going to happen anyways) but if it is something else the impact on the markets will be much more drastic.

Time to wait and see I guess…

 

In addition to the forecasted food and electricity shortages I cited above I think a possibility is that Evergrande is the beginning of the forced deleveraging of their real estate sector. Growth could be dampened severely. 
 

The other part that is a real wild card is the whole Taiwan, semiconductor chip situation. Why that could be coming to a head is more of a CR discussion that will upset some people.

 

It would make sense to get their house in order before they make a big move in the next few years. 
 

This stuff is part of why Bitcoin/crypto is so fascinating to me. This innovation will have significant geopolitical implications. 

Edited September 24, 2021 by Satoshi

[Satoshi 129]

 

[Satoshi 129]

Tangentially related to crypto here. A stock I’ve posted about before. Morgan Stanley initiated coverage. I’m a holder.
 

 

[Satoshi 129]

Edit- I haven’t been following this guy, but evidently he has no shot. StilL like seeing it thrown out there. 

Edited September 27, 2021 by Satoshi

[Scipio 61]

https://markets.businessinsider.com/news/currencies/hamster-trading-cryptocurrencies-rigged-cage-goxx-bitcoin-price-ether-doge-2021-9

A hamster has been trading cryptocurrencies in a cage rigged to automatically buy and sell tokens since June - and it's currently outperforming the S&P 500.

[Goofyboy 3292]

A Random Walk being sorta proven