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Bitcoin

IMF Urges El Salvador To Remove Bitcoin As Legal Tender (cnbc.com) 93

The International Monetary Fund is pushing El Salvador to ditch bitcoin as legal tender, according to a statement released on Tuesday. CNBC reports: IMF directors "stressed that there are large risks associated with the use of bitcoin on financial stability, financial integrity, and consumer protection, as well as the associated fiscal contingent liabilities." The report, which was published after bilateral talks with El Salvador, went on to "urge" authorities to narrow the scope of its bitcoin law by removing bitcoin's status as legal money. In Sept. 2021, the Central American nation became the world's first country to adopt the cryptocurrency as legal tender, alongside the U.S. dollar.

The IMF report went on to say that some directors had expressed concern over the risks associated with issuing bitcoin-backed bonds, referring to the president's plan to raise $1 billion via a "Bitcoin Bond" in partnership with Blockstream, a digital assets infrastructure company. Part of El Salvador's nationwide move into bitcoin also involved launching a national virtual wallet called Chivo that which offers no-fee transactions and allows for quick cross-border payments. For a country where 70% of citizens do not have access to traditional financial services, Chivo is meant to offer a convenient onramp for those who have never been a part of the banking system.

IMF directors agreed that the Chivo e-wallet could facilitate digital means of payment, thereby helping to "boost financial inclusion," though they emphasized the need for "strict regulation and oversight." Many Salvadorans have reported cases of identity theft, in which hackers use their national ID number to open a Chivo Wallet, in order to claim the free $30 worth of bitcoin offered by the government as an incentive to open a digital wallet. For months, the IMF has bemoaned Bukele's bitcoin experiment. [...] El Salvador has also been trying since early 2021 to secure a $1.3 billion loan from the IMF -- an effort which appears to have soured over this bitcoin row. The country will need to figure out some other backstop to shore up its finances. The IMF predicts that under current policies, public debt will rise to 96% of GDP by 20216, putting the country on "an unsustainable path."

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IMF Urges El Salvador To Remove Bitcoin As Legal Tender

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  • Risk (Score:5, Insightful)

    by phantomfive ( 622387 ) on Tuesday January 25, 2022 @06:43PM (#62207177) Journal

    Many Salvadorans have reported cases of identity theft, in which hackers use their national ID number to open a Chivo Wallet, in order to claim the free $30 worth of bitcoin offered

    This sort of thing is the biggest risk to El Salvador itself.

    The other risks the IMF worries about are risks to the IMF.

    • Re:Risk (Score:4, Insightful)

      by ASDFnz ( 472824 ) on Tuesday January 25, 2022 @06:47PM (#62207203)

      The other risks the IMF worries about are risks to the IMF

      I just wanted to quote this for emphasis.

      • This does NOT mean there are not also extremely high risks to the citizens of El Salvador.

        • by ASDFnz ( 472824 )

          Totally agree.

          I am just pointing out that the IMF is not doing it FOR the citizens of El Salvador, they are doing it for the IMF.

      • by AmiMoJo ( 196126 )

        The IMF is worried that the IMF will become less relevant, a less useful tool. Countries will be able to bypass it.

        It's just a shame they choose bitcoin. It's wasteful and doesn't scale.

        • Re: (Score:3, Insightful)

          by Junta ( 36770 )

          Or IMF doesn't like a nation putting their economy in a risky position and if it does burn down, going to the IMF for a bailout. IMF understandably doesn't want to piss away valuable resources on a totally avoidable crisis.

      • i'll just second and third that ... they must have migraines about something thats not in their control ... though i suspect the elders being behind the current state of Crypton mostly ... despite that, the first ones from Crypton dont seem to be too ruffled, how many times was the deskop pc gonna die by now ?
        (o .. well that too ...)
        im totally rooting for badass Bukele, IF the guy against the wind succeeds in building something there's gonna be a lot of shame and bad taste, like the BOE sounding the ala
    • Many Salvadorans have reported cases of identity theft, in which hackers use their national ID number to open a Chivo Wallet, in order to claim the free $30 worth of bitcoin offered

      This sort of thing is the biggest risk to El Salvador itself.

      The other risks the IMF worries about are risks to the IMF.

      Curios though - when they pay for something with bitcoin, and it loses half of it's value overnight - who eats the loss? This has to be somewhere in the mix.

      • If it loses half of it's BTC value but none of it's USD value? It will do that whether El Salvador accepts BTC or not...
        • If it loses half of it's BTC value but none of it's USD value? It will do that whether El Salvador accepts BTC or not...

          Aren't you seeing that backwards? When suddenly the bitcoin is worth half the number of dollars it was the day before, and you just accepted 1 million dollars worth of bitcoin for a million dollar project, and suddenly that amount of coin is worth 500 K. That's a problem.

          Hopefully you understand it as a problem, because in the real world, whipsaw worth might put you out of business. If you needed the entirety of that million worth, and the coin loses half it's value, you are screwed.

          • Note that the official currency in El Salvador is the US dollar.
            • Note that the official currency in El Salvador is the US dollar.

              I'm certain that they are thinking they would like to change that.

              Certainly complying with ransomware will be easier!

      • by Junta ( 36770 )

        And conversely, when someone takes out a loan to pay and the next day they suddenly owe twice as much in real world terms it's also a crisis. Deflation and Inflation are both disasters.

        • Yes it just isn't the reality of how currency works. You take out a currency in one currency and repay it in the same currency and actual value doesn't fluctuate by 30%... what fluctuates is the price relative to some other currency on the speculative market. It isn't as if domestic vendors shift their prices each day based on shifts in relative price in currency pairs. The same would be true of the subsequent 20% gain in BTC relative to the dollar... domestic vendors won't suddenly drop the prices on the s
          • "You take out a [loan] in one currency and repay it in the same currency and actual value doesn't fluctuate by 30%."

            Mistake and correction mine.
          • by Junta ( 36770 )

            domestic vendors won't suddenly drop the prices on the shelf.

            If the amount they would have charged doesn't cover their lease, they sure as hell would modify the prices on their shelf. If your argument held, then the supposed USD hyper-inflation wouldn't be a worry either, because people won't adjust prices.

            To you it seems like BTC fluctuated by 30% in a day. To the people of El Salvador the value of the USD fluctuated by 30% in a day.

            No, the global value has implications. They have to import electronics, equipment, food, pertroleum. If you play that 'everything is relative game' I guess you can say that BTC didn't fluctuate, just *everything* else in the world from food to fuel to USD fluctuate

            • "If the amount they would have charged doesn't cover their lease, they sure as hell would modify the prices on their shelf."

              But that is unrelated to the exchange value of BTC/USD. Just like the price on the shelf, their lease price is unlikely to shift on a daily basis alongside any speculative currency market price. Imagine you live in the US or someone using EUROs... does the price of your lease change when their relative values shift on the FOREX? No. Does the price of goods on the shelf? If they are imp
              • by Junta ( 36770 )

                Imagine you live in the US or someone using EUROs... does the price of your lease change when their relative values shift on the FOREX? No. Does the price of goods on the shelf?

                Yes the prices shift, if USD falls relative to the EURO in a significant way, then all european imports get pricier. If the prices on the shelves get pricier, then the lease becomes a bigger relative burden because it may prevent me from buying food. If my employer must pay european employees or use a lot of european goods, they may have to make paycuts to afford that and my pay decreases. This is amplified for a nation like El Salvador that are far more import-dependent.

          • by Junta ( 36770 )

            Oh and on the loan, no your balance doesn't suddenly double, but your earning potential halves. So while you still owe 10,000 tulips, same as yesterday, yesterday you were making 1,000 tulips a week but they can't afford to do that and cut you back to 250 tulips a week and suddenly that 10,000 tulips is a huge problem.

            • False equivalence. There is no valid relation or connection between BTC and the Tulip nonsense. That mentality of insisting BTC has no innate utility and nothing underlies it is exactly what clouds your ability to see simple market realities related to it. The very markets and economy in El Salvador have actual underlying supply and demand realities. If I increase the cost of my bananas because some banks used derivatives to manipulate a 30% shift in BTC/USD price for a few hours then I will have spoiled ba
              • by Junta ( 36770 )

                If I increase the cost of my bananas because some banks used derivatives to manipulate a 30% shift in BTC/USD price for a few hours then I will have spoiled bananas and by the time I sell them the fluctuation will have passed.

                We are talking about a month long event, not some transitory blip.

                Within the market in El Salvador the USD exchange rate only impacts transactions which touch the dollar

                This line of reasoning keeps presuming that USD/BTC shifts relative to each other cannot possibly be correlated to anything else. If USD per bushel of produce is flat but BTC per bushel of produce is not, then your absolutely impacted that BTC shifted value relative to the bushel and you won't be able to acquire the same amount of produce for X amount of BTC.

                The market reality did not shift by 30% in El Salvador

                But their market reality has shifted a lot. "shortly after the Bitcoin City announcem

      • The same thing that happens with the many fiat currencies with similarly shifting values and poor exchange rates. At least not locally. Bitcoin (or any currency) isn't losing or gaining value, the only thing that is changing is the price relative to other currencies on the speculative market.

        A substantial shift relative to the dollar for instance does little within a native bitcoin economy. Especially if it is a short term fluctuation. A store doesn't go relabel gum everyday. The only thing this impacts is
        • The same thing that happens with the many fiat currencies with similarly shifting values and poor exchange rates. At least not locally. Bitcoin (or any currency) isn't losing or gaining value, the only thing that is changing is the price relative to other currencies on the speculative market.

          Let us assume that the Euro loses 80 percent of it's value one day, then recovers and adds 100 percent the next, Then drops to almost nothing the day afterward. Now tell me that it is a great vehicle for investment.

          But bitcoin is somehow different. Well, yeah, it is. And not too many of the ways it is different are positive, other than for people who are operating outside the law,

      • by KlomDark ( 6370 )

        You wait until the next day, that's the beauty of volatility!

  • Sound Money (Score:2, Interesting)

    by Anonymous Coward
    "Sound Money" - @davetroy [twitter.com]:

    There are people who are genuinely trying to talk intelligently about cryptocurrencies, but can’t because they don’t have historical background. This thread tries to correct that by suggesting required reading. First, it’s necessary to know what problem it attempts to solve.

    Bitcoin is designed to be "sound money." It can’t be controlled by government. What’s mine is mine, what’s yours is yours, and can’t be "diluted" by shadowy "central ban

    • Wow. Just wow. Just run down the list with the names of few unpopular people who happened to also believe in the concept of financial independence and pretend they ARE the concept of financial independence. Even random interjection of completely offtopic and disconnected statements regarding Eugenics to create the impression there is some kind of link between the two.

      Between the great depression, dust bowl and the mass instability caused by the world wars and unacknowledged mass German counterfeiting of the
  • by SuperKendall ( 25149 ) on Tuesday January 25, 2022 @06:53PM (#62207221)

    I'm not too sure myself on how well this shift to use BTC as the national currency will play out.

    However to me, it seems pretty clear that the thing that really concerns the IMF here is that it might actually work out - and if it does, they would have other countries moving to a currency the IMF cannot control as well.

    • Re: (Score:2, Informative)

      by smap77 ( 1022907 )

      The IMF doesn't control currencies. No matter how many countries move to or keep whatever currencies they want, the IMF doesn't control any of them.

      So, that thing that "seems pretty clear" is actually not a thing at all.

      • by Junta ( 36770 )

        Right, but the IMF's mission does drive them to bail out troubled economies and so the much more reasonable explanation is they don't want to have to bail out El Salvador if BTC trashes them.

        • by N1AK ( 864906 )
          El Salvador doesn't use its own currency. It runs on usd, so they have no control over a bunch of monetary policy because a foreign government does. The US can print huge amounts of usd, and at least it benefits from the new capital while El Salvador just has to suck up the inflation this causes. And guess what... El Salvador was already a troubled economy. They've spent $70m on BTC (about $10 per citizen) which even for a small country like El Salvador is hardly a vast investment. Being entirely honest I'm
          • by Junta ( 36770 )

            The US can print huge amounts of usd

            This keeps being repeated over and over and over again. It's a potentially valid point, but when people bring up this as a hypothetical and point to 2021 6-7% inflation as proof, it rings hollow when in the last month BTC would have shown 40% inflation by the same metric. We weren't able to create a stable economy on the gold standard with 20th century living and the USD-as-fiat has had a generally stable track record over 80 years now, and BTC hasn't managed a single month of stability nor predictability y

            • point to 2021 6-7% inflation as proof

              The official inflation was over 7%

              Lots of items that anyone actually needs, like food and housing and gas, are up 15%-50% [visualcapitalist.com]

              BTC is just kind of right in the middle even with recent drawbacks to the vanishing purchase power of the USD, which will accelerate from here on.

              • by Junta ( 36770 )

                Sure, there are specific items that spiked in isolation in the midst of a global pandemic with restrictive lockdowns. Also specific items that had cratered in 2020 and by comparison look really extreme in the increase (gasoline is higher, but it is being compared to when it had 'crashed' during 2020. The 7% figure is worrisome and representative of what my paycheck does as a whole (actually I'm in somewhat better shape because my fuel consumption has pretty much zeroed out and thus the proportion of my ex

                • They didn't spike because of a global lockdown. They spiked because the supply of money has been drastically increased, and inflation always follows a large expansion of the money supply...

                  As you will see.

                  Also something lasting longer than a year and getting worse is not a "spike".

                  • by Junta ( 36770 )

                    On the front of why it happened, I would suggest most disruptive pandemic in 100 years *might* actually have some economic impact, I don't know why your are convinced that our entire productive machine is just peachy if not for some monetary policy.

                    However, even assume that 'oops, we overprinted to drive 7% inflation', that's still tame compared to the more untethered bitcoin value fluctuation. Also, it comes with counter, with the central management driving up rates to counter inflation. After 2008, we ne

                    • most disruptive pandemic in 100 years *might* actually have some economic impact,

                      It merely accelerated the inevitable, things like oil prices spiking are because of stupid policy choices and a very long lack of replacement exploration.

                      All of the fundamental things were going to cost more and more, this just jump-started the rise as bit, what is going no now has not been due to the pandemic for well over a year.

                      that's still tame compared to the more untethered bitcoin value fluctuation.

                      Haven't seen Bitcoin

      • The IMF doesn't control currencies. No matter how many countries move to or keep whatever currencies they want, the IMF doesn't control any of them.

        Oh really, perhaps you should take another look [imf.org].

    • by phantomfive ( 622387 ) on Tuesday January 25, 2022 @07:23PM (#62207361) Journal

      I'm not too sure myself on how well this shift to use BTC as the national currency will play out.

      It's a co-currency, so not the "sole national currency."

      Any time there are two currencies used in a system, one of them will be used primarily, and the other will be removed from the system (that is, unused because people keep it instead of spending it). This is Gresham's law. https://en.wikipedia.org/wiki/... [wikipedia.org]

      • Gresham's law applies to competing currencies. Despite what people claim about bitcoin, I don't think it constitutes a currency. It is something which can be traded for real money, and stored to be traded later, in the same sense that one can trade in oil, fine art, or stocks and shares. Using bitcoin as a medium of exchange is then a kind of barter, which is what people resort to when "real" money is too unreliable.

        It is worth noting that in countries where the official currency is unreliable, due to uncon

    • Bitcoin in an inherently deflationary currency: It gets harder to mine the more people are mining it.

      The only possible use for an inherently deflationary currency is to completely destroy everyone who isn't already in the ownership class under crushing debt.
      • They can transfer a remittance and cash it out instantly. They now have more dollars than they would otherwise have with Western Union's fees. Holding on to it is another story, but this seems like a legit use to me.
    • Small countries that do away with their own currencies and piggyback on someone elses, tend to use $US due to the perceived stability.
      Bitcoin is like the opposite of that...
      Good luck !

      How do people think loans and financing in this currency will work?
      You can have +/- 10% inflation per month or +/- 100% over a year or so.
      Who is going to borrow? And who is going to lend money under those circumstances?

      Who will El Salvador ask to bail them out when it all goes pear shaped?
      Oh the IMF...

    • by gl4ss ( 559668 )

      but they were using a currency IMF could not control. that's why they started using USD because it didn't go so well just with their own money machine going brrr which IMF totally would have controlled if they could have controlled it. they were as you would say out of control.

      bitcoin is also actually pretty risky because the reason why you would be using euros or dollars as currency in some random country is quite simple: so that it wouldn't lose half of it's value in a week. that's entirely why some count

  • by OrangeTide ( 124937 ) on Tuesday January 25, 2022 @06:54PM (#62207223) Homepage Journal

    The magstrip on a 1980's era credit card are formatted with ABA Track 2 encoding. Which is ... a digital format (4-bits per digit and structures in a fairly flexible way using start/end sentinels).

    I'm sure we can agree that electronically readable binary digits on a magnetic strip or embedded silicon wafer is digital. But technically hand-written numbers on a ledger is literally digital. And I suspect a bank teller 75 years ago sending a telegraph to another bank in order to do a wire transaction might a tiny bit faster than how it takes for confirmation of a Bitcoin transfer today.

    Analog equivalent would be to use physical coins and paper. Or I suppose weigh gold dust on a scale. That would be kind of a hassle though.

    • Re: (Score:1, Flamebait)

      by Train0987 ( 1059246 )

      I think the concerns have more to do with the whole Bitcoin scam being propped up with billions of counterfeit USD thing than being "digital".

  • by Anonymous Coward

    The IMF predicts that under current policies, public debt will rise to 96% of GDP by 20216, putting the country on "an unsustainable path."

    18194 years ought to be enough for anybody - Bukele

  • by Whateverthisis ( 7004192 ) on Tuesday January 25, 2022 @06:57PM (#62207235)
    From the summary: The IMF predicts that under current policies, public debt will rise to 96% of GDP by 20216.

    If El Salvador survives until 20,216 on Bitcoin as their legal tender without raising their debt above 96% of GDP, that would both validate Bitcoin as the greatest basis for any economy in history as well as make El Salvador the longest, most stable nation in human history.

    But it's more likely they'll be in trouble by 2026.

  • Serving as a warning to future generations when the Bitcoin value hits zero and turns their economy into a smoking crater is a good option too.

    • Their economy was already a smoking crater, that's why the IMF has been involved there in the first place. Now the crypto bros have just found a way to steal what's left.

    • The problem is, this then puts further pressure on the IMF and international community to offer financial aid and highly risky loans, and potentially destabilise the country (again) and region (as people become economic refugees).

      This is a gamble which will be paid for by the general populace of El Salvador and its neighbours, and the international community at large, and not by the people who put this gamble in place.

    • by Junta ( 36770 )

      Or on the other hand their economy could also be a crater because Bitcoin has insane deflation and anyone with a hint of debt is crushed by their liabilities.

      Either direction is catastrophic and BTC seems to love to go hard in either direction in very short periods of time.

  • ... because desperate people do desperate things.

  • The IMF only sees the system it is a part of.
    The idea that a nation state could exist without the IMF is not parsable inside the head of any IMF employee or participant.
    Nothing, nothing, threatens the IMF more than crypto. Not even war. War is just part of the IMF's background assumptions.
    A currency that is not influenceable by political control gives denies sleep to the IMF heads.
    The IMF will do nothing but discourage, lie, and rationalize, when it comes to crypto defamation and criminalization.
    Ye
  • So stuff cost double to those citizens compared to 2022? Sucks. Do they have virtual wheel barrels in the meta-verse?
  • If you cannot read, poke other people eyes out. This is how you keep them from showing you up or doing things you say are impossible.

    Reasons to stop this...

    1. Proves its possible.
    2. Removes country from financial controls such as sanctions.
    3. Removes banksters from control by bypassing their ability to set currency prices through decree.

    If you can't do this and want to make sure you aren't shown up, tell them to stop and start sabotaging things if they don't.

  • At least that's a long way off.

  • by saccade.com ( 771661 ) on Tuesday January 25, 2022 @08:23PM (#62207511) Homepage Journal
    Not basing your currency on a Ponzi scheme is a reasonable ask, since the IMF will be the ones stuck bailing them out.

    What even is "Bitcoin"? It's already forked into three separate coins.

    If you still think crypto/NFTs are anything other than a scam, watch this:

    https://www.youtube.com/watch?... [youtube.com]

    Yes, it's 2+ hours long. Worth it. The guy did his homework.

    • Currently, the IMF is one of the largest holders of gold. Gold is a Ponzi scheme. Outside of some obscure applications (320 tons a year) in technology, there are no real practical applications for gold that would give it an intrinsic value. The value of gold only exists because people believe it is valuable.
      • by chill ( 34294 )

        A Ponzi scheme is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. That has nothing to do with gold not having any intrinsic value. Intrinsic value of an asset has nothing to do with the scheme made famous by Charles Ponzi in the 1920s.

        Yes, gold has value because everyone agrees it has value, but that no more makes it a Ponzi scheme than it makes it a flying fish. Your comment is nonsensical.

    • by chill ( 34294 )

      Thanks for this link.

  • public debt will rise to 96% of GDP by 20216, putting the country on "an unsustainable path."

    The United States has public debt equal to 122.5% of GDP [stlouisfed.org], and as we've been told, debt doesn't matter [marketwatch.com], just like deficts don't matter. Until they do.

    • Debt does not matter while there is reason to believe that the debt repayment terms can be met. Banks are only too happy to lend you money, while you are obviously able to make the monthly payments. The "unsustainable path" occurs when the real wealth of a country is insufficient to act as collateral for its borrowing. I presume the real wealth of the USA is adequate to support a large sovereign debt relative to GDP, whereas the real wealth of El Salvador is not so dependable.

      Having said that, I wonder what

    • public debt will rise to 96% of GDP by 20216, putting the country on "an unsustainable path."

      The United States has public debt equal to 122.5% of GDP [stlouisfed.org], and as we've been told, debt doesn't matter [marketwatch.com], just like deficts don't matter. Until they do.

      Debt doesn't matter so much if you have the ability to print the money that debt is denominated in.
      YMMV You may cause some inflation and instability.

      El Salvador can't print $US or bitcoins. So debt will be a much bigger problem for them

  • It's the scenario where another country sees that this is a good idea, but poorly thought out and goes with Cardano or Algorand which are very energy efficient, highly scalable, have very high liquidity and really low transaction fees that are so low they scare Visa and MasterCard.

    You know how much it cost to move $4B of assets on Cardano recently? $66,000 in ADA coins [coinmarketcap.com]. That's it.

    The US and IMF are terrified that some of these broke ass poor countries will realize that it costs peanuts for them to set up th

  • The sole fact that the IMF thinks it's a bad idea should be grounds enough to actually believe it's not a bad idea. As someone else said, the IMF is essentially just the policy arm of the US (money elite), which is to say: of incredibly rich people protecting their own. /rant

    On a more serious note: it's only a risk in the sense of the IMF (i.e. a stability issue) if you think of Bitcoin in terms of exchange value, i.e. to the USD. If OTOH everything is Bitcoin, then... a Bitcoin is a Bitcoin is a Bitcoin. I

    • On a more serious note: it's only a risk in the sense of the IMF (i.e. a stability issue) if you think of Bitcoin in terms of exchange value, i.e. to the USD. If OTOH everything is Bitcoin, then... a Bitcoin is a Bitcoin is a Bitcoin. If a pizza costs one BTC, and you earn enough BTC on your daily job to buy enough pizzas, who cares how that actually translates to dolllars?... Yes, you'd have a slight deflation because the number of Bitcoins isn't ever increasing, but nit sure that's a bad idea per se.

      Assuming your economy is cut off from the rest of the world.

      Back in the real world, imports and exports will depend on the relative value of bitcoins.

      Bitcoins go down
      Everything imported will have to increase in price, or the country will have to do without.
      Anything you can make internally and export will become more competitive.
      You will tend to be exporting more. You economy will tend to gain more bitcoins.

      The opposite will happen if bitcoin goes up.
      Flip flopping between the two won't be good for you

      • It's a mixed package.

        I agree with everything you say, but I'm trying to see the situation from the perspective of a desperate country under the economic meddling (and suppression?) of other powerful players.

        I'm not an economist, and neither an expert on this country in particular. But Wikipedia says they've had about a dozen currencies in the past 2 centuries, so I'm guessing: introducing a new one in a few decades if things go south is not viewed as such a big problem. Right now, the mindset seems to be: "

        • I was mostly answering the general 'lets use bitcoin as our countries currency' what could go wrong!
          Not specifically El Salvador. Countries went off the gold standard for a reason.

          I'm not an economist, and neither an expert on this country in particular. But Wikipedia says they've had about a dozen currencies in the past 2 centuries, so I'm guessing: introducing a new one in a few decades if things go south is not viewed as such a big problem.

          Then it seems like El Salvador will keep trying currencies until it works something out.

          But my main argument wasn't supposed to be that this is necessarily the best idea; only that IMF's argument is not very honest, and is from a very subjective perspective designed to defend particular interests, not the overall wellbeing of everyone.

          Agreed that the IMF is concerned about the International system, and not much for El Salvador specifically.

          Right now, the mindset seems to be: "We're tied to a currency outside of our control, and in control of a superpower not looking out for out best interests." Going from this to "a currency outside of our control, but without another nation's control, either" at least seems like a bit of an upgrade. Solving one problem at a time, so to speak, and this one seems the most urgent.

          Don't know all that much about El Salvador, but are they really important enough that when America adjusts its monetary policy. It even

          • At least $US are going to be more stable

            That's actually a problem. We're trained to think stability = good in any context, but there's a reason the EU only accepts economies above a specific stability threshold into the (relatively stable) Euro monetary union.

            A stable coin in an otherwise volatile economy tanks the economy even more. Again, I'm not an economist to explain it well, but there are many things that can actually improve the inside day-to-day economy (the one most immediately significant for the people living in it) by controlled infla

            • Perhaps I should have used predictable rather than stable. It won't be constantly the same.
              People can attempt to predict the value of $US by looking at what's happening in America and the world. Is the economy doing well, are interest rates and inflation high or low etc. They can use that knowledge to plan their future purchases and investments. I'm not sure bitcoin is like that. The increased uncertainty will cause problems.

              Your idea about a bitcoin being worth a bitcoin in an isolated economy is an int

  • ... use of bitcoin on financial stability, financial integrity, and consumer protection ...

    So, the IMF thinks only they should have this power over a economically mis-managed country? Currency is meant to represent a nation's buying power but crypto-currency measures speculation for the sake of speculation. This disconnect makes a country vulnerable to capitalist take-overs. Or maybe, El Salvador already has that problem.

    What the IMF promises to do isn't its true purpose. The IMF has been accused of forcing poorer countries into a 'fire sale'. It doesn't offer much of that much-promised na

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