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(MSN)   If El Salvador's President keeps buying the "dip" in Bitcoin, we'll be deploying U.S. forces there to prevent an angry mob from ripping him to pieces in just a matter of months   (msn.com) divider line
    More: Followup, El Salvador, El Salvador President Nayib Bukele, SAN SALVADOR, Central America, International Monetary Fund, El Salvador's President Bukele, Currency, Money  
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862 clicks; posted to Business » on 06 Dec 2021 at 8:28 PM (7 weeks ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook



44 Comments     (+0 »)
View Voting Results: Smartest and Funniest
 
2021-12-06 6:41:53 PM  
This guy gets it! Crypto is here to stay. Look at all the inflation dollars have had this year. This economy is going to be the blockchain in less than a decade.
 
2021-12-06 8:38:23 PM  
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When you're right, you're right!
 
2021-12-06 9:06:17 PM  
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I bought the dip on Liberty the Bear. I'll get the last laugh, just you wait.
 
2021-12-06 9:10:55 PM  

b2theory: This guy gets it! Crypto is here to stay. Look at all the inflation dollars have had this year. This economy is going to be the blockchain in less than a decade.


Somehow, I doubt in the extreme that any non-suicidal economy is going to be switching to a currency that's deflationary by design. Deflation is death because it makes debt grow by default.

If I owed $780 to someone at the end of 2016, that debt would now be equal to owing about $675 thanks to inflation.

In contrast, bitcoin has undergone deflation by roughly 98.5% since 12/2016. If I had been stupid enough to denominate my december 2016 debt as 1 bitcoin instead, I would have gone from owing $780 to owing over $50000.
 
2021-12-06 9:20:27 PM  
In the future there will be no banks.  When you need a mortgage, you will just buy crypto and it will go up and you will use it to buy the house.
 
2021-12-06 9:22:01 PM  
They bought the dip at 30k and 40k too.  Since its currently over 50k, it seems an effective strategy.
 
2021-12-06 9:22:39 PM  

erik-k: If I owed $780 to someone at the end of 2016, that debt would now be equal to owing about $675 thanks to inflation.

In contrast, bitcoin has undergone deflation by roughly 98.5% since 12/2016. If I had been stupid enough to denominate my december 2016 debt as 1 bitcoin instead, I would have gone from owing $780 to owing over $50000.


Shiatty economies have to take out debt in someone else's currency. This is the big problem in places like Venezuela, where they take out $780 worth of debt, but then the Bolivar tanks, so their 780,000 BsS turns into 780,000,000,000,000 BsS in a matter of months.

What isn't clear is how Bitcoin would have helped that situation so much as do the exact same thing. "Sure, here's a bond with a face value of 5 BTC and you get the dollar equivalent today, but have to pay me back in bitcoin tomorrow when the price is 10x as high."
 
2021-12-06 9:27:37 PM  

erik-k: b2theory: This guy gets it! Crypto is here to stay. Look at all the inflation dollars have had this year. This economy is going to be the blockchain in less than a decade.

Somehow, I doubt in the extreme that any non-suicidal economy is going to be switching to a currency that's deflationary by design. Deflation is death because it makes debt grow by default.

If I owed $780 to someone at the end of 2016, that debt would now be equal to owing about $675 thanks to inflation.

In contrast, bitcoin has undergone deflation by roughly 98.5% since 12/2016. If I had been stupid enough to denominate my december 2016 debt as 1 bitcoin instead, I would have gone from owing $780 to owing over $50000.


They hold debt in USD, and are starting to keep their savings in BTC.  With the gains they are currently seeing buying dips, they could be debt free in a few years.

They bought 150 bitcoin at 30K as well, and have seen a tidy profit in that.
 
2021-12-06 9:31:23 PM  

Rapmaster2000: In the future there will be no banks.  When you need a mortgage, you will just buy crypto and it will go up and you will use it to buy the house.


Pfft, get a load of grandpa here, kids!  Everyone knows that housing will become irrelevant, as foretold by the economic soothsayers New Kids on the Blockchain.
 
2021-12-06 9:37:19 PM  
Bukele!!

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2021-12-06 9:47:24 PM  
El Salvador isn't a real crypto investor.  Why are they buying dips?  Real investors have no worthless dollars to buy dips because they already spent it all on crypto.  Since crypto only goes up, why isn't everything you own already in crypto?
 
2021-12-06 9:57:40 PM  

Lord Bear: erik-k: b2theory: This guy gets it! Crypto is here to stay. Look at all the inflation dollars have had this year. This economy is going to be the blockchain in less than a decade.

Somehow, I doubt in the extreme that any non-suicidal economy is going to be switching to a currency that's deflationary by design. Deflation is death because it makes debt grow by default.

If I owed $780 to someone at the end of 2016, that debt would now be equal to owing about $675 thanks to inflation.

In contrast, bitcoin has undergone deflation by roughly 98.5% since 12/2016. If I had been stupid enough to denominate my december 2016 debt as 1 bitcoin instead, I would have gone from owing $780 to owing over $50000.

They hold debt in USD, and are starting to keep their savings in BTC.  With the gains they are currently seeing buying dips, they could be debt free in a few years.

They bought 150 bitcoin at 30K as well, and have seen a tidy profit in that.


Debt free in a few years? First of all that "tidy profit" on 150 Bitcoin is only $3,000,000, not bad for sure but also not even holding a candle to the $21,000,000,000 national debt they have. Based on the article they own 1,370 Bitcoin total. Assuming their national debt stoped growing (they add about a billion a year to it), Bitcoin would need to go to over 15,300,000.00 a coin to wipe out their debt. I've seen some really aggressive predictions on the future value of Bitcoin but being north of 1 million a coin in "a few years" is extreme, and to be 15 times that is insane.

If you like Bitcoin, invest in it, but keep your expectations grounded in reality because it's half baked ideas like that which detach you from reality. Bitcoin might be deflationary but to expect that kind of deflation is a fundamental flaw in logic. It means a $100 investment today is expected to be worth $30,000 in a few years because "reasons".
 
2021-12-06 9:59:14 PM  
Have all countries use the US dollar.

Problem solved.
 
2021-12-06 10:09:52 PM  
keldaria:

Debt free in a few years? First of all that "tidy profit" on 150 Bitcoin is only $3,000,000, not bad for sure but also not even holding a candle to the $21,000,000,000 national debt they have. Based on the article they own 1,370 Bitcoin total. Assuming their national debt stoped growing (they add about a billion a year to it), Bitcoin would need to go to over 15,300,000.00 a coin to wipe out their debt. I've seen some really aggressive predictions on the future value of Bitcoin but being north of 1 million a coin in "a few years" is extreme, and to be 15 times that is insane.

If you like Bitcoin, invest in it, but keep your expectations grounded in reality because it's half baked ideas like that which detach you from reality. Bitcoin might be deflationary but to expect that kind of deflation is a fundamental flaw in logic. It means a $100 investment today is expected to be worth $30,000 in a few years because "reasons".


A $500 investment in bitcoin in 2016 is worth 50k today.

They are dipping their toe in right now and seeing results.  Suppose they go whole hog and buy tens of thousands of bitcoin, and the price doubles.  Suddenly they can put a pretty nice paydown on their debt, or invest in the country to bring in business to pay down the debt.

The simple fact here is that El Salvador is making good money on bitcoin.  It has brought in business and is currently building a new green geothermal power plant which will provide power for the country as well as make money on a bitcoin farm.  It has been a boon so far.  It's a proof of concept on a country wide scale and there are dozens of African and South American countries watching with great interest.  If the experiment is successful, many other nations will probably follow suit.

Pricewise, I personally think 500k in 10 years isn't unreasonable.  A million is a bit high, but if other countries buy in, it's not out of the question.  The US government was revealed today to have been mining bitcoin for awhile.  Things are changing out there pretty quickly.

https://www.investing.com/news/cryptocurrency-news/joe-bidens-government-is-mining-bitcoin-says-white-house-adviser-2700810
 
2021-12-06 10:33:02 PM  

Lord Bear: A $500 investment in bitcoin in 2016 is worth 50k today.

They are dipping their toe in right now and seeing results.  Suppose they go whole hog and buy tens of thousands of bitcoin, and the price doubles.  Suddenly they can put a pretty nice paydown on their debt, or invest in the country to bring in business to pay down the debt.

The simple fact here is that El Salvador is making good money on bitcoin.  It has brought in business and is currently building a new green geothermal power plant which will provide power for the country as well as make money on a bitcoin farm.  It has been a boon so far.  It's a proof of concept on a country wide scale and there are dozens of African and South American countries watching with great interest.  If the experiment is successful, many other nations will probably follow suit.

Pricewise, I personally think 500k in 10 years isn't unreasonable.  A million is a bit high, but if other countries buy in, it's not out of the question.  The US government was revealed today to have been mining bitcoin for awhile.  Things are changing out there pretty quickly.

https://www.investing.com/news/cryptocurrency-news/joe-bidens-government-is-mining-bitcoin-says-white-house-adviser-2700810


And about a little over a decade ago a guy spent 10,000 Bitcoin on a pizza which is now worth $500,000,000. You think that kind of "deflation" is normal or to be expected? If so you are an idiot for not maxing out your credit cards and buying Bitcoin if those are the types of returns you are expecting, 25% interest is nothing when in 10 years you are expecting that much compounding returns. Heck even your modest $500,000 in 10 years relies upon compounding return on investment of 25% a year, every year. That's over 2 times what the stock market average is when the fed is jamming money up its ass, and over 3.5 times the average. It's fine to think of Bitcoin as a competitor to traditional investing but it's insanity to expect that to continue and to be routine. We're seeing those kinds of figures right now in the real estate markets and most people are concluding it's a bubble. Hell, Bitcoin is still printing tokens, it's not even hit it's true deflationary period where it hits its cap and stops printing money. The only reason it's had outsized returns in the past is because adoption and sheer speculation and given the extreme swings the currency has, adoption as a currency is essentially out the door until it stops swinging so wildly because nobody will use it as a currency until they know they aren't going to be paying twice as much for that cup of coffee as if they used other hard currencies.

Make no mistake, the only thing really driving Bitcoin and other cryptocurrency market values right now is pure speculation. It's generated a return on investment of $49,500 on $500 in 2016, so clearly it'll keep going up like that... that is pure FOMO talk right there and while I have no doubt crypto is here to stay as an alternative to normal investing, I'm also not under and preconceptions that it'll be worth $500,000 or a $1,000,000 in 10 years.
 
2021-12-06 10:51:02 PM  

keldaria: a decade ago a guy spent 10,000 Bitcoin on a pizza which is now worth $500,000,000


This never happened.

I assume you're talking about the recruitment at MIT giving away 100 Bitcoin to some students?

Where did you get those outrageous numbers?
 
2021-12-06 10:52:44 PM  

libranoelrose: keldaria: a decade ago a guy spent 10,000 Bitcoin on a pizza which is now worth $500,000,000

This never happened.

I assume you're talking about the recruitment at MIT giving away 100 Bitcoin to some students?

Where did you get those outrageous numbers?


Laszlo Hanyecz paid Jeremy Sturdivant 10,000 Bitcoins for two pizzas in 2010 transaction
 
2021-12-06 10:54:44 PM  

libranoelrose: keldaria: a decade ago a guy spent 10,000 Bitcoin on a pizza which is now worth $500,000,000

This never happened.

I assume you're talking about the recruitment at MIT giving away 100 Bitcoin to some students?

Where did you get those outrageous numbers?


It was well publicized, although IIRC it was two pizzas for 10,000 BTC.

(googles)
https://www.coindesk.com/markets/2020/05/22/10-years-after-laszlo-hanyecz-bought-pizza-with-10k-bitcoin-he-has-no-regrets/
 
2021-12-06 10:58:13 PM  

keldaria: The only reason it's had outsized returns in the past is because adoption and sheer speculation and given the extreme swings the currency has, adoption as a currency is essentially out the door until it stops swinging so wildly because nobody will use it as a currency until they know they aren't going to be paying twice as much for that cup of coffee as if they used other hard currencies.


It isn't a currency and never will be...which is one example of why you don't understand your own argument.  Even the SEC isn't treating it that way.
 
2021-12-06 11:00:03 PM  

keldaria: And about a little over a decade ago a guy spent 10,000 Bitcoin on a pizza which is now worth $500,000,000. You think that kind of "deflation" is normal or to be expected?


Of course not.  There is a limit on the deflation.  If bitcoin ever becomes commonly used, it will be well distributed and the deflation will become close to nothing.  Its already happening.  Bitcoin is 'only' up 200% since its 2017 highs. The peaks and troughs are flattening a bit and its rise is slowing down.  There are very real reasons can never exceed about 1M USD.

The 20% swing it had over the last few weeks used to be an almost daily occurrence.  Things are far less volatile than they used to be, and getting less so every year.
 
2021-12-06 11:35:06 PM  
Bolebuns:
It isn't a currency and never will be...which is one example of why you don't understand your own argument.  Even the SEC isn't treating it that way.

That is an extremely stupid argument.  Bitcoin is being used to pay for goods and services, the very definition of a currency. 

However, cryptocurrencies are more than that.  They also have properties of other financial instruments.  Thats what make them special and valuable.
 
2021-12-06 11:35:59 PM  

Bolebuns: Laszlo Hanyecz paid Jeremy Sturdivant 10,000 Bitcoins for two pizzas in 2010 transaction


Ivo Shandor: It was well publicized, although IIRC it was two pizzas for 10,000 BTC.

(googles)
https://www.coindesk.com/markets/2020/05/22/10-years-after-laszlo-hanyecz-bought-pizza-with-10k-bitcoin-he-has-no-regrets/


Ah, I had not heard of him doing that.

I thought they were referencing the sushi restaurant that was accepting Bitcoin.

He spent $40 on two large pizzas, giving the money to someone who paid for it in fiat.

Looks like he did that several more times as he was able to mine several thousand per day before that.

Looking back it seems silly, but at the time he was using the money for what it was meant for.

He's doing fine.
 
2021-12-06 11:48:43 PM  

Lord Bear: Bolebuns:
It isn't a currency and never will be...which is one example of why you don't understand your own argument.  Even the SEC isn't treating it that way.

That is an extremely stupid argument.  Bitcoin is being used to pay for goods and services, the very definition of a currency.

However, cryptocurrencies are more than that.  They also have properties of other financial instruments.  Thats what make them special and valuable.


https://www.youtube.com/watch?v=blkHhCz5_nY
 
2021-12-06 11:53:58 PM  

Lord Bear: Bolebuns:
It isn't a currency and never will be...which is one example of why you don't understand your own argument.  Even the SEC isn't treating it that way.

That is an extremely stupid argument.  Bitcoin is being used to pay for goods and services, the very definition of a currency.


I suppose it is in the sense that gold is...but you are right...it is much more than that.  I think one of the reasons people can't wrap their heads around it is that they think it should be just like some sort of fiat.  You understand if you realize all of its other qualities.
 
2021-12-06 11:56:21 PM  

AmbassadorBooze: Have all countries use the US dollar.

Problem solved.


I think over 60 of them already do...many because their currency failed.  The USD will too, eventually.  Where you wanna be when that happens (wealth wise)?
 
2021-12-07 12:22:24 AM  
Good thing if push ever came to shove, no other country or group of people could ever create a copy of the software behind Bitcoin, call it something else, and drum up excitement for people to move over to the big new thing because Bitcoin investment is already too saturated.

No sirree! The population and infrastructure of the US would just cave to El Salvador and never ever use patriotism as a way to push a crypto alternative.

Now excuse me while I go back to MySpace, the one and only social network that everyone will be forced to join.
 
2021-12-07 12:55:03 AM  

erik-k: b2theory: This guy gets it! Crypto is here to stay. Look at all the inflation dollars have had this year. This economy is going to be the blockchain in less than a decade.

Somehow, I doubt in the extreme that any non-suicidal economy is going to be switching to a currency that's deflationary by design. Deflation is death because it makes debt grow by default.

If I owed $780 to someone at the end of 2016, that debt would now be equal to owing about $675 thanks to inflation.

In contrast, bitcoin has undergone deflation by roughly 98.5% since 12/2016. If I had been stupid enough to denominate my december 2016 debt as 1 bitcoin instead, I would have gone from owing $780 to owing over $50000.


Well that'd be pretty stupid of you, why world you even do that?

Better to just hold the bitcoin until it will buy what you want. That's how you use deflation.
 
2021-12-07 1:07:48 AM  

Bolebuns: AmbassadorBooze: Have all countries use the US dollar.

Problem solved.

I think over 60 of them already do...many because their currency failed.  The USD will too, eventually.  Where you wanna be when that happens (wealth wise)?


USD has always been and always will be the only thing with value.  Everything else, even the energy of the fabric of the universe derives itself from the dollar.  Life, comes from the dollar.  matter comes from the dollar.  Even intangible things like the concept of numbers comes from the dollar.
 
2021-12-07 2:14:41 AM  
Russia invading Ukraine could seriously spike the value of BTC. Biden has already stated that banking sanctions would be the most likely Weeners to an invasion, and since you cannot really sanction BTC it will likely cause a price spike. If profiteering is your thing then your ship may be about to come in.

/or you could lose it all
//decisions, decisions...
 
2021-12-07 6:29:09 AM  
Why would the US be preventing the mob from ripping him to pke
 
2021-12-07 6:30:45 AM  
*Ripping him to pieces? If the history of the region is any indication, the US would be secretly funding the mob with the goal of installing their puppet.
 
2021-12-07 7:13:09 AM  

Lord Bear: That is an extremely stupid argument.  Bitcoin is being used to pay for goods and services, the very definition of a currency. 

However, cryptocurrencies are more than that.  They also have properties of other financial instruments.  Thats what make them special and valuable.


Which makes them less useful as a currency, because the value of goods keeps changing. Sometimes dramatically.
 
2021-12-07 7:45:54 AM  
Isn't bitcoin finite? What happens when a hoarding situation happens? Also, trying to pay off the national debt? Do you want 1837? BECAUSE THAT IS HOW YOU GET 1837!
 
2021-12-07 7:46:59 AM  

fragMasterFlash: Russia invading Ukraine could seriously spike the value of BTC. Biden has already stated that banking sanctions would be the most likely Weeners to an invasion, and since you cannot really sanction BTC it will likely cause a price spike. If profiteering is your thing then your ship may be about to come in.

/or you could lose it all
//decisions, decisions...


Weren't they talking about taking Russia out of the swift system?
 
2021-12-07 8:35:29 AM  

hoodiowithtudio: Isn't bitcoin finite? What happens when a hoarding situation happens? Also, trying to pay off the national debt? Do you want 1837? BECAUSE THAT IS HOW YOU GET 1837!


Sir, this is a crypto thread.  Economics and history have no place here.
 
2021-12-07 9:30:12 AM  

Bolebuns: keldaria: The only reason it's had outsized returns in the past is because adoption and sheer speculation and given the extreme swings the currency has, adoption as a currency is essentially out the door until it stops swinging so wildly because nobody will use it as a currency until they know they aren't going to be paying twice as much for that cup of coffee as if they used other hard currencies.

It isn't a currency and never will be...which is one example of why you don't understand your own argument.  Even the SEC isn't treating it that way.


It is a currency in that I can be used to capacity and is what most crypto enthusiasts look at is as. Hell the initial concept billed it entirely as a currency, to ignore that is silly. Yet your reading comprehension leaves much to be desired because the paragraph you quoted from me specifically assessed that it's use as a currency is essentially nonexistent at this point and will be for the foreseeable future, it is purely functioning as a speculative asset at this point and the sec/fed are treating it as such.
 
2021-12-07 9:33:30 AM  

libranoelrose: Bolebuns: Laszlo Hanyecz paid Jeremy Sturdivant 10,000 Bitcoins for two pizzas in 2010 transaction

Ivo Shandor: It was well publicized, although IIRC it was two pizzas for 10,000 BTC.

(googles)
https://www.coindesk.com/markets/2020/05/22/10-years-after-laszlo-hanyecz-bought-pizza-with-10k-bitcoin-he-has-no-regrets/

Ah, I had not heard of him doing that.

I thought they were referencing the sushi restaurant that was accepting Bitcoin.

He spent $40 on two large pizzas, giving the money to someone who paid for it in fiat.

Looks like he did that several more times as he was able to mine several thousand per day before that.

Looking back it seems silly, but at the time he was using the money for what it was meant for.

He's doing fine.


The example wasn't about how fine he is doing or if he used the "currency" appropriately, the example was about show just how stupid the valuation has gotten in just a decade.

Fark user imageView Full Size
 
2021-12-07 10:50:48 AM  

Felgraf: Lord Bear: That is an extremely stupid argument.  Bitcoin is being used to pay for goods and services, the very definition of a currency. 

However, cryptocurrencies are more than that.  They also have properties of other financial instruments.  Thats what make them special and valuable.

Which makes them less useful as a currency, because the value of goods keeps changing. Sometimes dramatically.


The volatility of crypto, and bitcoin in particular is down a lot over the last few years.  Rome wasn't built in a day.  There are 'real' world currencies that change as much or more (Turkey, Venezuela), usually due to hyperinflation.  The difference here is that as a store of value for bitcoin trends up, and fiat trends down.  Even the US dollar loses a ton of value every year.

Saying that something is worthless because it changes is failing to see the bigger picture.
 
2021-12-07 12:03:59 PM  

Hawk the Hawk: [Fark user image image 330x450]

When you're right, you're right!


Rumor has it that's him mansplaining to January 6th terrorists how to make a proper noose on a budget, and how he saved the Olympics by charging $1 per slice of pizza at meetings.
Rumor also has it that he was just a hologram so the bullets, nail boards, noose, and knives just went right through him as he laughed sensibly.
 
2021-12-07 12:25:52 PM  

b2theory: This guy gets it! Crypto is here to stay. Look at all the inflation dollars have had this year. This economy is going to be the blockchain in less than a decade.


and then when we can't produce enough electricity any more for all that...

I mean crypt is here as you say, and apparently money is going t go away So yo do get that thigns are not permanent.
What do you imagine goes on if say, something like electricity production is not able to be permanently meeting demand for all that crypto?

What happens ot the value of crypto if we see that it can be denied existence, becasue we need that electricity for stuff that is intrinsically more important? like you know food production or water treatment?
Whole to of states west of the Colorado get no water if we can't run the pumps to get it there.
Did you imagine those people are ahppy to go without water, became crypto?
 
2021-12-07 12:28:44 PM  

Lord Bear: They bought the dip at 30k and 40k too.  Since its currently over 50k, it seems an effective strategy.


And now they own a total of 250.

So it doesn't really matter.
 
2021-12-07 2:02:41 PM  

Ketchuponsteak: Lord Bear: They bought the dip at 30k and 40k too.  Since its currently over 50k, it seems an effective strategy.

And now they own a total of 250.

So it doesn't really matter.


They are insane.  The electricity plant from the geothermal energy could provide cheap, reliable energy for everyone in El Salvador, maybe even subsidize businesses they need to grow their economy.  He might as well enter high stakes private poker games in Vegas.
But then again, global leadership hasn't been this weak since around 1914.
 
2021-12-07 3:38:50 PM  
Northern:

They are insane.  The electricity plant from the geothermal energy could provide cheap, reliable energy for everyone in El Salvador, maybe even subsidize businesses they need to grow their economy.  He might as well enter high stakes private poker games in Vegas.
But then again, global leadership hasn't been this weak since around 1914.


Look at it this way.  El Salvador is a fairly poor country.  They don't have the money to build a geothermal plant that will provide energy for the country and pay itself off in 50 years.  They do have the money to build a geothermal plant that will provide power for a portion of the country and pay itself off in 5 years with an attached bitcoin plant.
 
2021-12-07 9:49:42 PM  

Northern: Ketchuponsteak: Lord Bear: They bought the dip at 30k and 40k too.  Since its currently over 50k, it seems an effective strategy.

And now they own a total of 250.

So it doesn't really matter.

They are insane.  The electricity plant from the geothermal energy could provide cheap, reliable energy for everyone in El Salvador, maybe even subsidize businesses they need to grow their economy.  He might as well enter high stakes private poker games in Vegas.
But then again, global leadership hasn't been this weak since around 1914.


What are you on about. Don't they only own 250?
 
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