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El Salvador Makes Bitcoin Its Legal Currency

Kelvin Fernandez

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El Salvador becomes the first country in the world to make Bitcoin it's legal Currency. The Bill was passed at midnight after two hours of debate.

The President of El Salvador it's encouraging all crypto entrepreneurs to move to El Salvador. He promises them legal residency, no capital gain taxes and no federal or state taxes.

He also promised to invest in Bitcoin mining operations through thermo energy from the country's many active volcanos.


You must spend 3 BTC within the country to gain residency.

El Salvador now has three legal currencies.

1. US Dollar (official use)
2. Salvadorean Colon ( official currency, not used, no longer printed)
3. Bitcoin

The president's tweets.
View: https://mobile.twitter.com/nayibbukele/status/1402508938415939593
 

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sojeer

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This is great :) it’s gonna be interesting to see how other countries will try to adopt crypto
 

socaldude

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I think it’s great.

But it will be interesting what happens considering those Latin American countries down there suffer from serious corruption and organized crime. Especially among their political elites.
 

MJ DeMarco

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Interesting, how does El Salvador compare to its neighbors like Costa Rica and Honduras?

El Salvador and Guatemala tend to have negative connoctations in America as hotbeds for crime and corruption. I realize that such a label is probably overstated and probably not reflective of its current state.
 

MTF

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Interesting, how does El Salvador compare to its neighbors like Costa Rica and Honduras?

70% of the population doesn't have a bank account and/or a credit card. It's a cash-based society, and a USD one.

I find it unlikely they'll start using something as difficult to figure out and use as crypto. They trust cold, hard cash. The only people who will use it will be maybe some businesses catering to tourists.

The president of the country is an autocrat constantly grabbing more power. Corruption is prevalent and so is violence. Not a particularly pleasant place to be unless you like it rough...
 

GPM

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@MTF but won't it lure those there who do understand it and who will bring with them entrepreneurship? It says you have to spend 3 Bitcoin to gain citizenship or whatever. That is a significant sum of money flowing into that area. Bringing in the equivant of $70-90,000 usd into the economy in a short period of time would be incredibly large for that area of the world.

The best way to combat crime and corruption is to allow and encourage locals to be successful.
 

Kak

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There is actually a lot to like about him.

One of my new strategic partners is friends with him and he wants to play a much bigger part in the global economy. Seems like a seriously capitalist guy.

Working with the very top of El Salvador is part of the reason for this new relationship.
I totally f*cked this up. It was Ecuador and their new president. I don’t know shit about El Salvador actually. :rofl:

I blame new dad brain.
 
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scottmsul

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I actually listened to the entire Twitter spaces chat last night, it was pretty ridiculous watching one big name after another show up. Then out of nowhere the El Salvador president himself joined and was answering questions from the biggest names in bitcoin.

For some context I highly recommend watching Jack Mallers' announcement from the Miami conference:
View: https://www.youtube.com/watch?v=_59hrgTiRJU


Basically there was this Bitcoin Beach project trying to get this one small town to use Bitcoin natively as a currency. Then Jack Mallers moved in and made his Strike app work natively in El Salvador. Since it uses lightning network, it allows people to transact and receive remittance payments instantly and with zero fees. This is a big deal since 70% of the country is unbanked, and remittance fees are over 50%. Regardless of your opinions on the El Salvador government, this is a huge deal for bringing financial empowerment to the local population. For the past few months leading up to this announcement, Strike had been the #1 downloaded app in the country and had been on-boarding 20,000 people a day.

Will be interesting to see how the US/IMF react, and if other LatAm countries follow suit.
 

monfii

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I don't pretend to be an expert on btc, but I am not sure they understand what btc is nor what it does.
 

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Kelvin Fernandez

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Interesting, how does El Salvador compare to its neighbors like Costa Rica and Honduras?

El Salvador and Guatemala tend to have negative connoctations in America as hotbeds for crime and corruption. I realize that such a label is probably overstated and probably not reflective of its current state.
El Salvador has been very dangerous in the last decade. Right before the new president took office it was one of the most dangerous country in the world. At one point it became the number one murder capital of the world. But the new president started a massive sweep of organized crime. I went there at the start of the year and you can feel a sense of relief from the people that live there. Last time I went was in 2015 and people didn't go anywhere because of fear. When I went this year people were moving around freely and were traveling to the beaches, something they didn't do before. The US also improved the Travel Advisory from Level 4: Do Not Go to Level 2: Exercise Increased Caution which is the average Level for most European countries just yesterday. So it seems that it's moving in a positive direction.
 
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Successful Steve

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El Salvador has been very dangerous in the last decade. Right before the new president took office it was one of the most dangerous country in the world. At one point it became the number one murder capital of the world. But the new president started a massive sweep of organized crime. I went there at the start of the year and you can feel a sense of relief from the people that live there. Last time I went was in 2015 and people didn't go anywhere because of fear. When I went this year people were moving around freely and were traveling to the beaches, something they didn't do before. The US also improved the Travel Advisory from Level 4: Do Not Go to Level 2: Exercise Increased Caution which is the average Level for most European countries just yesterday. So it seems that its moving in a positive direction.
I was there in 2014 living with friends. We were told not to travel to Honduras while we were there. Love the country. Gotta love a president who is tough on crime. America is actually more dangerous now that we have a weak president.
 

Successful Steve

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70% of the population doesn't have a bank account and/or a credit card. It's a cash-based society, and a USD one.

I find it unlikely they'll start using something as difficult to figure out and use as crypto. They trust cold, hard cash. The only people who will use it will be maybe some businesses catering to tourists.

The president of the country is an autocrat constantly grabbing more power. Corruption is prevalent and so is violence. Not a particularly pleasant place to be unless you like it rough...
Baltimore is more dangerous and violent then El Salvador. I felt safer there then I ever have walking around San Francisco, Memphis, Baltimore and other US cities.
 

Kelvin Fernandez

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I was there in 2014 living with friends. We were told not to travel to Honduras while we were there. Love the country. Gotta love a president who is tough on crime. America is actually more dangerous now that we have a weak president.
Nice what were you doing there and where?

Baltimore is more dangerous and violent then El Salvador. I felt safer there then I ever have walking around San Francisco, Memphis, Baltimore and other US cities.

I think the difference between Latin American countries and US cities is the type of crime committed. Most Latin American countries have some type of criminal organization behind the crimes. The homicides are mostly between rival parties. Meanwhile the crime in cities like Baltimore and San Francisco is random unplanned crime of opportunity. Anyone can be a target.
 

Successful Steve

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Nice what were you doing there and where?



I think the difference between Latin American countries and US cities is the type of crime committed. Most Latin American countries have some type of criminal organization behind the crimes. The homicides are mostly between rival parties. Meanwhile the crime in cities like Baltimore and San Francisco is random unplanned crime of opportunity. Anyone can be a target.
I have a lot of friends from there in the community where I live so I learned a lot about the culture and ex gang members trying to escape that lifestyle for a safer life and I did security for a client who was from there and he invited me to his cousins home in La Libertad. They took me all over the place in El Salvador and into Guatemala.
 

Onakosa

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Nice what were you doing there and where?



I think the difference between Latin American countries and US cities is the type of crime committed. Most Latin American countries have some type of criminal organization behind the crimes. The homicides are mostly between rival parties. Meanwhile the crime in cities like Baltimore and San Francisco is random unplanned crime of opportunity. Anyone can be a target.
I think there's a lot of truth in that. I've been in 'lively' places and never really had a problem. Part of it is just being sensible, but also because unless you're unlucky enough to get caught in crossfire, you can usually plan to avoid areas/places where you know it's likely to kick off. The most violent place I've ever been was a particular football match in London where the police turned up in full riot gear and kettled us all in to the ground. Standing in the middle of this, the other side were pissed and lobbing coins and bits of brick at us, while the cavalry stood watching behind their riot shields. I never saw anything like that in Colombia or Mexico!
 

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