Understand the implications of Bitcoin's downfall in El Salvador. Learn about the failed economic bet and its impact on the country's financial stability.
The reason El Salvador stopped using Bitcoin as a legal tender is not because it’s some sort of failed experiment (it had issues, but still), but due to continuous pressure of IMF interested in maintaining a US dollar-centric economy.
El Salvador is reliant on US dollars in its economy, which puts it under heavy US influence. Knowing Salvadoran currency wouldn’t be strong, Nayib Bukele suggested an alternative option - risky, volatile, but free from pressure of other countries and strongly appreciating in the long run. IMF didn’t like it, and that’s where we are.
So, when you cheer Bitcoin not being legal tender anymore, you also cheer US and IMF projecting power over the country.
Its even funnier. They just straight up promised them a billion dollar loan on the condition that they abandon bitcoin.
In December, the government struck a $1.4 billion loan deal with the International Monetary Fund (IMF) that scaled back its bitcoin embrace after the lender urged officials to limit its exposure. The lender specifically advocated making acceptance of bitcoin voluntary for the private sector, which is spelled out in the hastily-approved law.
They were forced to stop using Bitcoin as legal tender by external parties. The question people should be asking is why? And the answer is not that it was a failed experiment.
Let’s not get astray here.
The reason El Salvador stopped using Bitcoin as a legal tender is not because it’s some sort of failed experiment (it had issues, but still), but due to continuous pressure of IMF interested in maintaining a US dollar-centric economy.
El Salvador is reliant on US dollars in its economy, which puts it under heavy US influence. Knowing Salvadoran currency wouldn’t be strong, Nayib Bukele suggested an alternative option - risky, volatile, but free from pressure of other countries and strongly appreciating in the long run. IMF didn’t like it, and that’s where we are.
So, when you cheer Bitcoin not being legal tender anymore, you also cheer US and IMF projecting power over the country.
Its even funnier. They just straight up promised them a billion dollar loan on the condition that they abandon bitcoin.
https://www.reuters.com/world/americas/lawmakers-el-salvador-rush-new-bitcoin-reform-after-imf-deal-2025-01-30/
Hot damn why is this not the headline we are seeing
Thats what im wondering, because thats the blog post headline i first saw.
Exactly. The title is misleading af
They were forced to stop using Bitcoin as legal tender by external parties. The question people should be asking is why? And the answer is not that it was a failed experiment.
The experiment was to move beyond external parties. They were not able to do so and returned to using external parties. Ergo “the experiment failed”.
They were forced to do it by the IMF and US
Why do you think that they’d care about it if it was failing?