When Tesla first bought Bitcoin in February, it was a Bitcoin maximalists dream come true. They posted dozens of threads about how institutional investors are all jumping in, and so should you!
Months later, we’re seeing how poorly that aged…
False Narrative #2: Bitcoin Adoption in Latin America
Latin America is a region that has been long affected by weak, corrupt governments that tend to impose capital controls, currency devaluation, and other hardships on their citizens.
Over these past few weeks, you may have read misleading articles or headlines about how Latin America is rapidly adopting Bitcoin.
With a total of 20 countries in Latin America, only 1 of them has voted on using Bitcoin as a legal tender. Nayib Bukele, El Salvador’s dictator, only accepted Bitcoin under the condition that every citizen used “Strike”.
So technically, they aren’t even using Bitcoin. The people of El-Salvador are using Strike Token. Too poor to ever use real Bitcoin because getting on-chain is too expensive. Hopefully, Strike or the El Salvador government doesn’t decide to confiscate these Strike Tokens from the people in the future.
I don’t know about you, but I wouldn’t feel safe putting my money in the hands of a corrupt authoritarian regime, and some relatively new, and unsecured company. It won’t end well. Trust me.
Lack of Infrastructure to support Bitcoin.
El Salvador is one of the poorest and most unstable countries on earth. With a physical cash economy, it’s said that nearly 70% of folks do not have access to banks.
The term “Legal tender” means it’s required to be accepted by every business & individual. While we will still need to wait around 3 months before it actually becomes the law, it’s safe to assume that this stunt will be very chaotic, because nobody would really be able to use or afford it.
For a country that’s drowning in poverty, and crime, their attempt to escape inflation by wanting to accept Bitcoin, a very overvalued, speculative, and risky asset, is just another reason why they are one of the worst economies in the world.
Paraguay and Mexico aren’t Adopting Bitcoin
Many accounts on Twitter have been pushing the idea that Paraguay and Mexico are also rushing to adopt Bitcoin. Both are completely false.