Interesting. George Selgin, Senior Fellow and Director of the Cato Institute’s Center for Monetary and Financial Alternatives, dives into the El Salvador’s new BTC legal tender legislation: the good and the bad.
I was wondering/worrying about this very thing. Always beware the small-print!
It would be quite disenfranchising to force bitcoin—not to mention the practical and privacy implications.
From my reading around legal tender law in the past, it is primarily for settling debts in a court of law. That is, they will demand payment in it and compensate with it. If something doesn’t go to court, then you can choose what to trade in.
Maybe there is more nuance, but that was my take home before.
Not with the El Salvador legislation. Businesses are going to be required to accept BTC alongside USD - whichever the customer chooses. However they have a loophole for those who don’t have the prerequisites for accepting BTC.
The government will also create a service which immediately converts any bitcoin received into USA for merchants that want this.
I was watching a doco some years back about one of the large geothermal plants in the US and they mentioned the tiny earthquakes they get because they are releasing pressure in the ground as they get the steam from the ground. They had to pump the treated waste water from the local town back into the ground creating stream to maintain the pressure and increase the volume of stream they can extract.
To me it showed they have to be careful how they extract the heat.
Great opportunity for BTC’ers to ‘Loan’ instead of “Hodl”, just to send a message to the MILF.
Depends on the MILF. One mans MILF is another ones bunny-boiler
The MILF is IMF, they’ll take that L soon once they go down the
Going ever so slightly off topic here…
Was wondering how soon SNT would become legal tender… but then I thought…
…you know what else is “Legal Tender” globally?
People trade DATA all the time. They are going to need SNTs to do this.
I think it would be funny if the president of El Salvador pushed for the IMF meeting to be televised and then ask them what the real “risk” they keep mentioning is. I’m guessing they mean risk to their influence.
Let governments, sovereign nations, state and local gov react they way they deem fit as far as regulation or adoption. Sounds like a one world government already I guess Personally don’t care for how vague they are and how they make sweeping accusations about crime and money laundering like they uphold a utopia and then try strong arming innovators.
I wouldn’t give el presidente too much credit for being a ‘good guy’ here. For all we know he may have planned for the IMF ‘visit’ in the hopes that they will sit down and offer him and his cronies a big fat personal payoff to hit the undo button. Time will tell.
How long before the first government crowdsale, and what would they be offering?
- interest bearing crypto bonds
Legal tender law is most useful for settling debts in court. El Salvador seem to have gone further, but it isn’t necessary to use other tokens of exchange. Consider gift vouchers, for example.
DBCs may unlock many distributed asset tokens for general trade. Arguably, it is what private banks do already - your balance is made up of their credit tokens to exchange for central bank money. When they go bust, their tokens become worthless and you are reliant on insurance and goodwill to make you whole.
The difference is, with traditional banking, they have special regulations and relationships with the central bank and the government. They have a private transfer network (e.g. BACS, swift, etc) which only permitted banks can use.
With DBCs, tokens become very accessible. Anyone from banks, through companies, to individuals can mint them. They can represent anything or nothing. Anyone can participate, as the network is available for anyone to use.
Ofc, if a deal goes south and you need to use the courts, then legal tender laws will dictate what is used to make you whole, but day to day it doesn’t really matter.
Works for Cuba.