El Salvador's Bitcoin investments are in the black
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But really...how much could they have earned if they invested it elsewhere instead? It seems silly for any country to invest in crypto. Nations should use their money to invest in themselves and build their economy, not to park it in crypto.
This argument works for anything. Not even any asset, any literal thing.
There is a laundry list of better reserve assets between U.S. dollars, Euros and gold, on one hand, and Bitcoin, on the other hand. Particularly for an economy as small as El Salvador’s.
Bitcoin makes paying off gangs and cronies simpler for San Salvador. That’s the benefit of this boondoggle.
Does it? Surely it's easier to hand someone bags of cash or gold bars if he doesn't want to leave a trail. Everyone in the world can see the moment he withdraws some BTC from the country's wallets.
Do you think many of those who bought in the 40-60k region are looking to cash out given the opportunity?
I see the same happening to Bitcoin (a lot of similar properties to Gold, better in some aspects and worse in some other).
1. "I have never seen an actual usecase for Bitcoin after 15 years" -> Here is a list I compiled, giving concrete real world examples - https://news.ycombinator.com/item?id=32406095
2. "Crypto is scam. Look at x and y and z". -> Crypto is a nascent field lacking clear regulations. As such, it indeed attracts scammers. Regulations should catch up and scammers should be punished. But calling entire crypto "a worthless scam" is weird. Afterall, Coinmarketcap lists 1.54T current total market cap, including legit projects like Bitcoin (816B), Ethereum (267B), USDC (24B) etc.
3. "My corner of the world is amazing and it doesn't need crypto" -> Well, congratulations and good for you! A lot of other parts of the world have shitty governance and poor monetary policies. The only options for those people were USD/EUR and Gold. Bitcoin adds a third option and has some superior qualities than USD/EUR or Gold (happy to go into details if needed).
4. "Crypto bros are insufferable" -> I couldn't agree with you more. Especially the ones who made a ton of money peddling shitcoins in the previous bullruns and think they are superior to everyone else. But they belong to the same class as "insufferable SV bros" and "insufferable wall street bros". I have learned to ignore them by now.
Crypto has use on the fringes of civilisation, which includes both horrible people and people in horrible circumstances. That undermines any argument for its use by a state, by the definition of a nation-state at the centre of its nation. The only reason for a state to use crypto is so its leaders can engage with the fringe, i.e. criminally.
A broad share of population in Venezuela, Iran, Sri Lanka, Turkey, Argentina, Zimbabwe and many other countries suffering from crazy inflation can benefit from crypto. Dismissing them as "fringes of civilisation (sic)" is simply wrong.
Turkey and Argentina have better options at the state and population levels. (And they use them.) Sri Lanka and Zimbabwe, at the state level (but not necessarily population). They, too, use them.
The only names where it might make sense for the state to use crypto are Iran and Venezuela. And it’s for the reason I described: it lets them pad pockets.
Crypto promoters whitewash their work as a humanitarian effort when it’s largely about making money from embezzlement, laundering and fraud. Like, the humanitarian stuff exists. Just as opiates have legitimate uses. But it’s predominantly not, and practically never for a state.
> crazy inflation
Bitcoin's inflation in 2021 was worse than most of the countries on your list. Its value plummeted by over two thirds.
6. The better than thou attitude is a huge turn off, as demonstrated by your leading rebuttals. If you want to further the conversation, please bring something new to the table.
7. Crypto purism cannot comply with AML/KYC and many other regulations and court decisions. It is at odds with societal expectations.
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I do think there is something to be said about blockchain tech being applied to the information trust problem. Projects like Cosign use Trillian (https://transparency.dev/) for software supplychain security to ensure provenance. Good provenance has to reach back to the source and hardware. Software only solutions will not complete the circle. An example I like to use is proving the authenticity of an image. We will have to get cryptographic signatures on the image before it reaches beyond the firmware, and we'll also need a way to trust the software and HSM in a camera. Here, I think blockchain tech might have a valid application.
Personally, I'm a fan of Proof of Authority ledgers like Trillian and Hyperledger Fabric. We don't need the crypto and it's baggage to get the majority of the benefits.
Agreed. Though I am sure it will be solved in a few years.
> 7. Crypto purism cannot comply with AML/KYC and many other regulations and court decisions. It is at odds with societal expectations.
I am not a crypto purist and yet a believer. So I see a place for Coinbase and Kraken as a legit entry point (and maybe the destination) for a vast majority of honest people who just want to invest in BTC.
> 6. The better than thou attitude is a huge turn off, as demonstrated by your leading rebuttals. If you want to further the conversation, please bring something new to the table.
Maybe you know everything I said. But for every crypto discussion on HN, you can see the same shallow arguments trotted out. So this is the unfortunate tradeoff to preempt those comments.
2. It's weird to justify that it's not a scam by listing the market cap. Is that market cap even accurate if we consider how many BTC are inaccessible or burned?
3. This is the same as your list in 1, still a single use case
4. It's more about the percentage of the overall population. Crypto bros dominated the scene and conversation during the hype. The SV bro culture is not the dominate culture and has largely been reined in by the woke movement
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Why do we only hear about crypto when prices go up? We are already seeing it come back on HN with the recent price increase. If it's so great, why does the conversation disappear when the price goes down? Surely there is something else to talk about. Why is it always about price or profits, this post is case-in-point?
"Money" or "Store of value" is a mainstream use case. I am fine with just that one, honestly.
> The SV bro culture is not the dominate culture and has largely been reined in by the woke movement
You and I have different filter bubbles it seems. I live in SV, for that matter. Agreed about the woke bubble though.
> Why do we only hear about crypto when prices go up?
Again, just seems to be your bubble? A lot of interesting things happened during the last 1.5 years - ETH merge, uptick in ZK technology, L2 rollups etc which regularly popped up in my news feed, with plenty of interesting discussions.