El Salvador was historic. The first country to adopt Bitcoin as a national currency. What bigger milestone can there be for the new currency form. Sounds great, but I'm skeptical. In Econ 101 I learned that currency must be stable. When eggs are $2 on Monday and $4 on Friday it muffs everything up. Restaurants can't plan, businesses can't invest, consumer confidence falls. Stability of a currency is the second-most important feature behind faith. {image} So how can BTC, in all its crazy volatility, possibly act as a national currency? I applaud...
. But I think this is more about the remittances than anything else. They had ~$6 Billion of remittances in 2020 and the fees on those are nuts. https://www.cnbc.com/2021/09/09/el-s...on-a-year.html Assuming BTC is used for remittances and then immediately cashed out into USD the fees should still be less than Western Union. But by having businesses accept BTC as currency they can keep at least a fraction of BTC in the hands of their citizens. If someone doesn't want to speculate on BTC/USD price moves they can immediately cash out. If they feel it's going to crash they can use it to buy things now. If they think it's going to increase in value they can hold onto it and use it as savings. Having it as a currency incentivizes people to keep that BTC within the El Salvador economy to an extent. If you are a believer that BTC is still way undervalued this could be a way to lift the country out of poverty.
Also the president was definitely front-running this and loading up on BTC at lower prices, but I would have done the same thing so no judgement here.
