The President personally frys Bitcoin and defeats a country

Recently, Bitcoin has fallen very hard.

As of the morning of the 20th,Bitcoin has passed the $20,000 mark, falling to a new low in the past 18 months, and many people have lost their pants.

Now it has risen a little ▼

The 150,000 speculators who speculated in the currency successively liquidated their positions within 24 hours, and the total loss was as high as 567 million US dollars.

Cryptocurrency platforms like BlockFi and Crypto.com laid off hundreds of employees overnight, leaving them to fend for themselves on Wall Street next door.

And to say that this wave of losses is the worst, it is not which currency circle boss, nor which private equity fund, but a national entity called El Salvador.

At this moment,Led by a man who calls himself “the coolest dictator in the world,” the tiny northern Central American nation of 6.5 million people is taking a wild bet on bitcoin.

And what they are betting on is not only their own future, but also the future of all mankind.

Everything starts from June last year.

At a bitcoin conference in Miami, USA, a 41-year-old man named Nayib Bukele announced to the world that his country, El Salvador, would circulate bitcoin as legal tender.

Who is Nayib Bukele?

He is the current president of El Salvador, who was sworn in in 2019 and has a governing style known for his “fix-ups” and “iron fists”.

Nayib Bukele ▼

On the one hand, Nayib, who was born in advertising, is proficient in new media marketing.

After becoming president, he either went to the United Nations to take selfies, or tweeted at high intensity every day to go to work, dedicated to creating his own cutting-edge Internet celebrity character.

Nayib, on the other hand, played politics extremely decisively. In February 2020, when MPs refused to pass the budget for him, he directly stormed parliament with a group of armed soldiers for physical persuasion.

The same is true for the fiatization of Bitcoin this time.

A few days after the “Miami Announcement”, Nayib held a 5-hour conference with his politicians and came up with a “Bitcoin Law” less than 3 pages,Resolutely made El Salvador officially become “the first country in the world to use digital currency as legal tender”.

Correspondingly, El Salvador will deploy more than 200 Bitcoin ATMs across the country,

Since 2001, the only legal currency in El Salvador has been the U.S. dollar, which is so good, why suddenly add a bitcoin?

In this regard, Nayib made a full explanation. To sum up, there are roughly the following points:

70% of the people in China can’t use the banking system normally, but half of the people have mobile phones, so everyone just switch to digital wallets.

A large number of Salvadorans are working overseas, and the handling fee for remittances to the country is too expensive. It is better to switch to a P2P Bitcoin transaction channel.

The country’s economy has the dollar too tied up and it’s time to decouple.

Bitcoin transactions and digital scan code payment are both convenient and fast.

The president thinks it beautifully, but when he actually implements it, it’s not like that at all.

First of all, the rise and fall of Bitcoin is too violent, and many hawkers in El Salvador are surprised to find that,I only traded with the client one minute late, and lost dozens of cents for no reason.

Second, the infrastructure supporting Bitcoin is too stretched.

People in El Salvador found that the Bitcoin ATM machine on the street corner often reported an error after swallowing money, and they had to call the staff for repair.

The transfer from the e-wallet Chivo always takes at least one day to be successful.

Moreover, everyone’s money in this wallet is often lost due to hacker attacks.

After a lot of tossing, ordinary people began to gradually realize that compared with the digital currency that has been hyped up, it is more reliable to see and touch the beautiful knife.

Therefore, after more than half a year of legalization of Bitcoin, even in places such as Walmart and Starbucks in the capital of El Salvador, people can still only pay in US dollars.

There are fewer and fewer stores that support bitcoin payments like this ▼

In 2021, only 2% of the funds sent to El Salvador from overseas will choose the Bitcoin channel. That’s a far cry from what the president had first conceived.

Yet while the shaky economic reforms looked chaotic, Nayib was optimistic.

Because in this chaos, a utopia appears on the horizon.

In El Salvador today, there is only one place that fully supports Bitcoin transactions.

Located in the southern part of the country, this place is a small coastal community called El Zonte, nicknamed “Bitcoin Beach.”

In Bitcoin Beach, everything from hotels, bars to craft stalls in the market, from hair cutting, surfing to buying an oyster snack on the street, can be bought and sold with a digital currency wallet called bitcoinbeachwallet.

For President Nayib, Bitcoin Beach is his ideal Bitcoin community, the blueprint of his dream digital utopia.

So, not long after announcing the fiatization of Bitcoin, Nayib came up with his wilder plan in November 2021 — to build a “Bitcoin City.”

In the president’s vision, this city is the ultimate form of El Zonte.

It will be built next to the Conchangua volcano in eastern El Salvador, and will rely on the volcano’s own geothermal energy to power the entire city and mining cards for mining.

The entire city is designed in the shape of a bitcoin. The entire city’s economy is built on digital currency, which has functions such as tourism and commerce, and residents living here have to pay a small amount of value-added tax. Tax free.

City Concept Map ▼

Tax free ▼

It would take about $17 billion, or about 300,000 bitcoins, to build such an Ayn Rand-esque fantasy city.

And President Nayib’s fundraising method is to issue a bitcoin bond called “Volcano”. Half of the money raised is used for the construction of the new city, and the other half is used for bitcoin investment.

Moreover, the president also declared that anyone who invests more than $100,000 (or more than 3 bitcoins) in El Salvador can immediately obtain residency in the country.

However, this is not enough.

In order to make money for the motherland more quickly, Nayib, who is in control of the power, decided to go out to speculate on coins himself-a rare scene in human history appeared.

The president of a country began to publicly announce to people all over the world on Twitter: “Today we took the money from the treasury and bought xx bitcoins with our mobile phone!”

Live Trading ▼

Judging from the tweet, Nayib’s investment idea is straightforward – it is pure buy low and sell high.

By June 3 of this year, the president had bought at least 2,301 bitcoins for his country.

Purchase Timeline ▼

Of course, this figure was calculated by journalists and experts solely from Nayib’s Twitter timeline — we have no way of knowing what part of the country is responsible for bitcoin transactions, or whether the transactions the president is talking about are real Fake.

According to Nayib, his state-level bitcoin investment has been quite successful, and the profits have already built an affordable pet hospital.

25 cents to see a doctor ▼

But in fact, since Bitcoin began to circulate in El Salvador, its price has begun to fall all the way.

As of today, Nayib’s bitcoin investment has lost more than half, and more than 50 million US dollars have evaporated under the president’s one-stop operation.

Faced with doubts, El Salvador’s Finance Minister came forward to appease, saying that “tens of millions of dollars only account for a few tenths of our total budget”, which is trivial.

However, what is more serious than losing money is that due to the high uncertainty of Bitcoin, El Salvador has been downgraded by many international rating agencies. Some experts worry that this will lead to the bankruptcy of this country whose debt ratio accounts for 90% of GDP.

But although he lost a lot of money and pushed the whole country to the brink of collapse, for President Nayib, his real purpose has already been achieved.

You may have noticed a subtle detail:

The fact that El Salvador designated Bitcoin as legal tender was actually announced by President Nayib in English (instead of Spanish, the official language of El Salvador) at the Bitcoin Conference in Miami, USA.

Because for Nayib, Bitcoin is not so much a tool he uses for financial reforms as it is a tool he uses to attract attention.

Laser eye, the standard currency circle meme ▼

Bitcoin did not bring much substantial change to the lives of ordinary people in El Salvador, but it did make speculators and curiosity hunters start to pay attention to this country on the fringes of the world.

In the year of fiatization, countless Bitcoin believers and vlogers have flown to El Salvador, creating 30% more tourists to the country last year.

Various VLOG ▼

Together, there are investments and summits.

Immediately after President Nayib said he would build a Bitcoin city, European real estate companies came to buy land near the volcano in bulk at 3 to 5 times more than usual.

In June, central bank governors and heads of financial regulators from 44 emerging countries gathered in El Salvador to discuss “financial inclusion”.

Similar high-end summits,

El Salvador has hosted several games this year ▼

Some media said that this conference will be the beginning of a new “Bretton Woods system”.

Under the leadership of El Salvador, Honduras, Zimbabwe and many other small countries have joined the camp of embracing Bitcoin one after another, hoping to use digital currency to achieve overtaking in corners.

Bitcoin ATMs in Honduras ▼

However, what is very cyberpunk is that El Salvador, a pioneer in digital finance, is also a country with extremely backward infrastructure.

In this country of 6.5 million, 500,000 people have no access to clean drinking water, and only 1 in 10 people in rural areas have access to the Internet.

Serious water pollution ▼

In this country that has always been shrouded in chaos, large and small towns are all controlled by gangs, and ordinary people’s work, school, and even worship are all precisely controlled by gangs.

And gang-to-gang conflict will lead to 936 homicides in El Salvador in 2021, killing 62 people within 24 hours.

When President Nayeb announced last November that he would use the profits from bitcoin speculation to build 20 schools, El Salvador saw 20 homicides in a single day in the same month.

So the president began to strike hard indiscriminately.

In just one and a half months, 35,000 “gang members” were arrested, including 12-year-olds and 18-year-olds with mental disabilities who couldn’t take care of themselves.

In the end, 2 percent of El Salvador’s adults ended up in jail, and videos of them being beaten and fasted circulated online.

However, for those ordinary people, the president’s iron fist has greatly reduced the crime rate and brought them a long-lost sense of security.

Therefore, although the fiatization of Bitcoin has led many people to take to the streets to protest Nayeb’s decision, the Internet celebrity president, who jokingly calls himself a “dictator”, still has an approval rate of 86.8%.

And his citizens still lit candles due to a power outage, while taking out their mobile phones to check the rise and fall of bitcoin in their wallets.

The gamble continues, and the fate of El Salvador’s 6.5 million people is still tied to the trend of Bitcoin price by Nayeb, like a speeding roller coaster, oscillating up and down, or slipping into hell, or flying to heaven.

“It’s already at the bottom, no matter how you go, it’s all up.” ▼

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