De Guevara Is Bitcoin Country’s Interim President As Bukele Steps Down To Run

Photo Credit: Dirección de Obras Municipales (DOM)

President Nayib Bukele of El Salvador has been granted a special license allowing him to temporarily step down from his presidential role to pursue a second term in the country’s upcoming elections on February 4, 2024. This move aligns with a 2021 Supreme Court ruling and the constitutional interpretation, specifying that Bukele can only seek a second term if he vacates the presidency six months prior to the start of the subsequent presidential term, commencing on June 1, 2024.

Of notable concern to many Salvadorans was Bukele’s security, particularly given his firm approach to combating criminal gangs, making him a potential target for these illicit groups. Addressing these concerns, the legislative assembly has approved his presidential security detail.

In the interim, Claudia Juana Rodríguez de Guevara was appointed the presidential designate. She will serve as the caretaker of the presidency until June 1, 2024. Rodríguez de Guevara has a longstanding professional relationship with Bukele, having held various roles alongside him throughout his career. Her most recent positions include serving as the private secretary of the presidency and as the president of the board of directors of the Municipal Works Directorate.

Despite her extensive background working with Bukele, Rodríguez de Guevara maintains a subtle public profile with minimal presence on social media platforms. As a caretaker, major policy changes during her tenure are unlikely. Her stance on significant issues, such as the country’s policy regarding Bitcoin, remains undisclosed due to the temporary nature of her role. However, given her alignment with Bukele’s past approaches, it’s anticipated that she’ll maintain continuity with the current administration’s direction.

Milei’s Presidency: Implications For Argentina, El Salvador, And Bitcoin Adoption

On November 19, 2023, Argentine voters elected Javier Gerardo Milei, an Austrian economist known for his candid and unconventional style, as their new president. He ran on a platform promising substantial reforms: cutting spending, reducing government intervention, addressing inflation, and eliminating the central bank.

Milei’s path to victory was unexpected. In the general elections, he secured second place with 30% of the vote, trailing Sergio Massa of the Peronist establishment, who garnered 37%. Patricia Bullrich, former Minister of Security under President Macri’s administration, obtained 24%. These results forced Balotaje, or a run-off election between Massa and Milei.

On the run-off election night, it became apparent early on that Massa’s camp wouldn’t prevail, leading him to concede before official results were released, extending well-wishes to Milei.

Milei’s Victory Speech

During his victory speech, Milei conveyed several key messages:

– He emphasized the start of Argentina’s reconstruction and thanked pivotal figures, including poll watchers from his party and PRO, an establishment coalition party. He also thanked former President Macri and his election opponent, Patricia Bullrich, acknowledging their contribution to bringing about change.

– Milei declared an end to what he called the “Argentinian Decadence,” denouncing a system favoring a privileged few and vowing to revisit the principles of liberty, Alberdi’s ideas (an Argentine Libertarian), and the vision of Argentina’s founding fathers.

– He invited all Argentinians to join this new transformational project in embracing liberty, highlighting unity over differences while acknowledging resistance from those entrenched in the existing system. His message to his opponents was striking, as he warned them that under a Milei administration, “everything within the law, and nothing outside the law.”

– Asserting the need for immediate and drastic changes, he warned of an impending crisis if the country doesn’t rapidly address critical issues like inflation, poverty, security, and unemployment. He emphasized that his administration could not afford gradualism, lukewarm implementations, and half-measures and that changes must be swift.

– Milei extended a global commitment to democracy, free markets, and cooperation with other nations for a better world, culminating in his passionate rallying cry: “Viva la libertad, Carajo!“—Long live liberty, dammit!

The Allure of Post-Partisan Politics in Latin America

While Milei’s victory signifies a milestone for Latin America in advancing post-partisan politics, which Salvadoran President Bukele leads this movement, and potentially influencing Bitcoin adoption, some caution is warranted. Milei himself is not a Bitcoiner, but as an Austrian economist, he understands the need for Bitcoin to counteract central bank and Keynesian policies. In fact, one of his main policy planks is to dollarize the Argentinian economy to more closely reflect the reality of what is already happening on the ground. The dollarization of the country alone is one of the most anti-Bitcoin measures he could take; however, this is where idealism meets reality, and Milei must do what is best for Argentina.

Milei’s alliance with the conservative and center-right party, PRO and Patricia Bullrich, might require compromises for political support. His challenges echo Macri’s, including the need to move towards market-friendly policies, address corruption allegations, and avoid the perception of favoritism to the Argentinian elite.

Despite Milei’s limited support in Congress, his need to garner votes may lead to political compromises, possibly deviating from his intended policies. El Salvador’s President, Bukele, was in a similar situation when he was blocked from running in his own party and then chose to run with a political rival GANA. While Bukele did not capitulate to GANA and eventually garnered enough votes in Congress, it is still uncertain how Milei’s situation will impact his policies.

Don’t Trust Milei, Verify

It’s crucial for Bitcoiners to exercise patience and manage expectations, as Milei did not run on Bitcoin as a main economic policy. While Milei aims to address deep-seated issues in Argentina, his primary focus might not align with Bitcoiners’s vision of Bitcoin adoption. Argentina, with its size and resources, has the potential to achieve greatness, but Milei recognizes this, and he will likely proceed cautiously in some areas and be swift in others, and not all will be to the satisfaction of Bitcoiners.

As My First Bitcoin’s founder, John Dennehy, put it best, “There’s been a lot of cheerleading on here because Argentina’s president-elect, Javier Milei, has said positive things about Bitcoin. If we judge politicians not based on what they have done but on what they promised during their campaign, then we have learned nothing. Don’t trust, verify.”

This is a guest post by Jaime Garcia. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

Bukele Likely To Step Down As President To Seek A Second Term

In recent weeks, the Salvadoran media has been abuzz with speculation that Bitcoin Country President Nayib Bukele will step down from his current role to pursue a second term in office. This move hinges on obtaining a special license from the Salvadoran Legislative Assembly, a process that requires three-quarters approval from the body. Previously, it was widely believed that Salvadoran presidents were limited to a single five-year term. However, a landmark Supreme Court ruling has opened the door to the possibility of a second term, provided the incumbent steps down at least six months before the next presidential term commences on June 1, 2024.

The Constitutional Framework

The Supreme Court’s ruling introduced a nuanced framework for seeking a second presidential mandate in El Salvador. It stipulated that a candidate can serve a maximum of two terms within a ten-year period, but crucially, they cannot hold the presidency and campaign simultaneously. This unique provision is designed to ensure that a candidate must “humble” themselves to the status of a citizen without a position of power within the government. This safeguards against the misuse of state resources for campaign purposes, an issue that has plagued many democracies around the world.

The Race Against Time

As of now, President Bukele has not yet registered as a candidate for the upcoming elections. The Supreme Electoral Tribunal has set a deadline of October 26, 2023, for presidential candidates to submit their registrations. However, it is increasingly likely that Bukele will need to step away from the presidency in order to meet this crucial deadline. This adds an extra layer of complexity to an already intricate political process.

In a recent press conference, Bukele indicated that he would register as a candidate on October 24 or earlier, but definitely before the deadline and according to the law. What is unclear is whether he will step down before registering or not, and there may be two options for Bukele:

  1. To step down from the presidency before the October 26 deadline and register as a candidate; or
  2. To register as a candidate while still in the presidency by the October 26 deadline and step down later to meet the constitutional requirement. This scenario is only viable assuming that the Supreme Elections Tribunal would rule that Bukele’s candidacy is provisional, provided that he does not campaign until he steps down, which must happen by November 30.

Implications for El Salvador

This development carries significant implications, particularly for the Bitcoin project in El Salvador, a flagship initiative of Bukele’s administration. Additionally, it holds paramount importance for Salvadorans who have experienced notable gains in terms of security and overall improvements in their country. The upcoming elections, scheduled for February 4, 2024, will undoubtedly shape the future trajectory of El Salvador.

Bukele’s Popularity and Controversies

President Bukele enjoys a staggering approval rating of over 90%, making him the clear frontrunner in the upcoming elections. However, not everyone agrees with his bid for a second term. Detractors and members of the political opposition argue that the Supreme Court ruling that enabled his candidacy is unconstitutional. This dissent has sparked heated debates on the legality and ethical implications of his potential second term.

The Road Ahead

As the presidential electoral campaign officially kicked off on October 3, 2023, all eyes are on Bukele and his next move. When he decides to temporarily vacate his post to seek a second term, the question of who will step in as interim president becomes vital. Both local and international observers will closely monitor this transition period.

The political landscape in El Salvador is undergoing a seismic shift as President Nayib Bukele readies himself for a bid for a second term. The Supreme Court ruling, the electoral deadlines, and the intricacies of Salvadoran politics converge in this pivotal moment. The outcome of these events will not only shape the future of El Salvador but will also have far-reaching implications for the region and beyond. As the nation stands at the precipice of this historic juncture, the eyes of the world remain fixed on Bitcoin Country.

This is a guest post by Jaime Garcia. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

Dare to Dream: A Film Unveiling the Genesis of Bitcoin Beach

In the heart of El Zonte, El Salvador, a profound transformation is underway, captivating the global Bitcoin community. Bitcoin Beach, an innovative initiative, has not only changed lives but also paved the way for El Salvador’s historic Bitcoin legal tender law. The documentary “Dare to Dream: A Story From El Salvador,” directed by Joe Delahunty, along with producer and funder Graham Rittener, unravels the true narrative behind this groundbreaking movement, dispelling myths and showcasing the transformative power of Bitcoin.

On a visit to El Zonte, Rittener was inspired by the work Bitcoin Beach and Hope House were doing to improve their community. He noticed that although there is a lot of technical and macroeconomic content, there was a gap in covering the human stories behind Bitcoin, especially regarding the rise of Bitcoin Beach. Rittener, especially saw the positive aspect that Bitcoin was having in changing people’s lives. He also wanted to make the content relevant not just to Bitcoiners but to the general public as a whole through qualitative stories that they could connect with.

To that end, it was important that the film took the audience through answering the question of “what is money?” Here, Bitcoin philosopher and podcaster Robert Breedlove, in a friendly and accessible manner, guides the audience through this complex question.

The Genesis of Bitcoin Beach

“Dare to Dream” illuminates the origins of Bitcoin Beach, dispelling the mystery that surrounded its inception. With meticulous precision, Delahunty traces the roots of this groundbreaking movement, unearthing untold stories that led to an unprecedented financial revolution in El Zonte.

The film vividly portrays Bitcoin’s potential, surpassing mere speculation. Through intimate vignettes, we witness the profound impact of Bitcoin as a tool, liberating El Zonte from violence and despair, offering a beacon of hope, and a chance for young individuals to remain rooted in their community.

As the legal tender law gained momentum, what began as a grassroots movement got entangled in political debate. The media frenzy threatened to misrepresent Bitcoin Beach, yet at its core, the project remained steadfast, apolitical, and a testament to the enduring power of community-driven initiatives.

Personal Journeys: Hopes, Dreams, and Love for Community

“Dare to Dream” introduces us to the individuals who birthed Bitcoin Beach, giving voice to their aspirations and love for family, community, and country. Roman Martinez (Chimbera) and Jorge Valenzuela, lifelong friends turned trailblazers, candidly share why Bitcoin became a lifeline. The film also unravels the enigmatic story of the anonymous Bitcoin funder, shedding light on how Mike Peterson, in collaboration with Chimbera and Valenzuela, turned this vision into reality.

Documentary still shot provided by Joe Delahunty.

The educational efforts by Chimbera and Valenzuela went beyond Bitcoin, equipping the community with technical knowledge to navigate Lightning Bitcoin wallets and bridging the gap for an unbanked non-technical audience, tailoring the education and wallet solutions to suit unique community needs.

The educational facet became a catalyst for holistic empowerment, extending to English language classes and diverse skill-building initiatives. Surfing, soccer, art, and drama classes emerged as strategic investments in the personal development of the community’s future leaders.

Documentary still shot provided by Joe Delahunty.

Multifaceted Realities: El Salvador’s Bitcoin Adoption

“Dare to Dream” features the testaments of renowned figures in the Bitcoin space, providing a unique perspective on the ongoing evolution of Bitcoin adoption. Max Keiser, who relocated to El Salvador and committed significant resources, shares some of his insights on Bitcoin adoption, while Nicolas Burtey, CEO of Galoy, emphasizes the role of Lightning as a means to empower communities. The documentary also shows podcaster John Vallis conducting interviews with locals and industry players.

Additionally, the film delves into a comprehensive exploration of how Bitcoin is integrating into the fabric of Salvadoran society. It reveals a tapestry of benefits beyond digital currency, from innovative remittance methods to a burgeoning tourism boom and merchant empowerment through reduced fees.

Documentary still shot provided by Joe Delahunty.

A Beacon of Possibility

While audiences are required to pay to view the film, it was created as a non-profit project, and if the film makes any profit, 90% of the proceeds will go directly to help the educational outreach efforts of Bitcoin Beach and Hope House.

“Dare to Dream: A Story From El Salvador” is a powerful testament to Bitcoin’s potential to bring tangible change. It transcends borders, representing a beacon of possibility for a more inclusive and prosperous world. Every Bitcoiner and anyone intrigued by the potential of Bitcoin should witness this story, for it is not just about Bitcoin but about the people, their dreams, and the hope for a better future. The film is a reminder that just as Jorge and Chimbera are changing their world, we are also encouraged to dare to dream and change ours.

Note: “Dare to Dream: A Story From El Salvador” can be streamed on Apple TV, Prime Video, YouTube Movies, Google Play, Vudu, and others in the United States; Apple TV, YouTube Movies, and Google Play in Canada; Apple TV in the Caribbean; Amazon UK in the United Kingdom; and Vimeo in all other countries. If you’re outside the US, Canada, and the Caribbean, you can purchase the documentary using Bitcoin. Inquiries on the film can be directed to Graham Ritter here.

This is a guest post by Jaime Garcia. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

El Salvador’s Bitcoin Revolution: Two Years as Legal Tender

Two years have passed since El Salvador made history by becoming the first country to adopt Bitcoin as legal tender. In that short span, the nation has undergone remarkable changes and improvements. While some might consider it a mere coincidence, the most plausible explanation lies in the profound transformations initiated by the country, with Bitcoin at the heart of its rebranding and a notable shift in attitude among its citizens. This article explores the impact of Bitcoin’s legal tender status on El Salvador’s development, the challenges it has faced, and the broader implications of this groundbreaking decision.

The Challenges and Public Perception

El Salvador’s history has been marred by centuries of adversity and struggle, but its current generation of citizens is determined to break free from that dark past. New leaders have emerged with a resolute commitment to improve their country. This newfound resolve has been instrumental in the progress witnessed in El Salvador, triggered by the decision to embrace Bitcoin as a legal tender.

Despite the improvements brought about by Bitcoin, a recent poll revealed that Salvadorans rank the Bitcoin law as the lowest achievement of the Bukele government. This does not necessarily indicate disapproval but underscores the fact that other pressing issues have a more direct impact on their daily lives. This realization aligns with a fundamental lesson from Bitcoin – that achieving meaningful change requires hard work, dedication, and a focus on the long-term rather than shortcuts.

Many have wondered aloud if the Bitcoin project would fail if Bukele were not able to achieve a second term or after he decides to leave the presidency. Critics believe Bitcoin would fail if his leadership were not driving the economic agenda. However, what many fail to realize is that the country did not change because of Bukele alone but because he had the support of the people who gave him a mandate to transform the country and because he assembled a team of competent leaders who are happy to take the relay baton once their time comes.

Tangible Improvements

Choosing to adopt Bitcoin was not easy for El Salvador, especially in the face of pressure from the IMF, the U.S. government, and various financial entities threatening to halt foreign aid and loans. Immediately after the adoption, the country’s bonds were downgraded to junk status, with no demand. However, El Salvador has since fulfilled its bond obligations and seen its bonds become one of the most promising investments. While these financial maneuvers may not directly impact the average Salvadoran, other developments certainly do.

Image Credit Source: El Salvador Travel

The country has experienced a boom in tourism, increased real estate activity, and significant infrastructure upgrades, including new roads, airport enhancements, and the establishment of a new ferry route to Costa Rica. These tangible improvements have not only enhanced the country’s attractiveness but also provided opportunities for its citizens.

El Salvador’s introduction of its digital assets law, favorable tax incentives for tech companies, and a landmark agreement with Google have motivated the company to base some of its Cloud services in the country. This move signifies growing confidence in El Salvador’s business environment and its potential as a Latin American tech hub.

Another exciting development on the Bitcoin front is the entry of Volcano Energy into the mining arena. This forward-thinking company has invested a staggering $1 billion USD to set up a mining operation that taps into wind and solar power. Furthermore, they plan to harness the volcanic energy of the country for Bitcoin mining, utilizing its geothermal potential. This initiative not only showcases El Salvador’s commitment to sustainable Bitcoin mining but also attracts significant foreign capital to the country.

In a move that underlines El Salvador’s growing importance in the global financial ecosystem, both Bitfinex and Binance have sought out regulatory stability to set up their exchanges and operate within the country. This signifies a recognition of El Salvador’s dedication to fostering a supportive business environment.

Security Transformation

Perhaps the most fundamental achievement has been the government’s success in addressing the country’s security issues. El Salvador, once the worst country in terms of murders per capita, has now become the safest in the Americas. This transformation, although met with criticism and accusations of dictatorship, has significantly improved the daily lives and human rights of Salvadorans.

These accomplishments have resulted in widespread public approval of President Bukele and his government, who now hold the highest approval ratings in the world. This support may translate into a second presidential term and a strengthened legislative assembly majority, crucial for passing laws, including those related to Bitcoin.

Graph Credit Source: TResearch

The U.S. has also shifted its stance, appointing a new ambassador who has given a favorable review of El Salvador, marking a notable change in its relationship with the country after years of criticism. While this move may be far from American acceptance of El Salvador’s Bitcoin Law, it signals some sense of tolerance. As the U.S. re-embraces El Salvador as a trusted partner, it significantly reinforces the government’s security and economic development efforts as local opportunities contain illegal immigration.

Educational Initiatives: My First Bitcoin and CUBO+ Program

The Educational NGO My First Bitcoin has made significant strides in fostering Bitcoin education within the country. After training hundreds of teachers and educating over 25,000 young Salvadoran students, they continue to experience astounding success. Their curriculum has not only impacted the lives of Salvadoran students, but My First Bitcoin has also exported the program internationally. Furthermore, they have entered into an agreement with the Ministry of Education to incorporate their Bitcoin curriculum into the national education system, ensuring that future generations are well-versed in sound money.

In terms of more advanced education, a program known as CUBO+ aims to train developers in Bitcoin programming. This initiative is essential for adopting Bitcoin, as Salvadoran developers should understand and have a say in developing core Bitcoin code. Students in the CUBO+ program have been selected through a competitive meritocratic process and taught by industry experts like Jimmy Song, Pierre Rochard, and Saifedean Ammous. Notably, Saifedean Ammous has also been newly appointed as an economic advisor to the Salvadoran government, underlining the government’s commitment to fostering expertise in the Bitcoin space.


While the average Salvadoran may still need to start using Bitcoin in daily transactions, the ethos and work ethic intrinsic to Bitcoin – proof-of-work – have reshaped the country’s trajectory. El Salvador remains the only nation where Bitcoin is legal tender, making it an attractive destination for companies seeking to develop their Bitcoin-based businesses. As El Salvador continues its journey as a developing economy, the hard choices made in the past two years have laid a solid foundation for a brighter future. The world watches with keen interest, and one fact remains undeniable: El Salvador is Bitcoin Country, and its Bitcoin revolution is here to stay.

Liquid Bitcoin Versus Wrapped Bitcoin: A Comparative Analysis

Given the increasing transaction fees caused by Ordinals activity in the Bitcoin timechain, many Bitcoiners have sought alternative solutions to keep their transaction fees low during these periods. While Bitcoin Layer 2 options like the Lightning Network offer low transaction fees, it may not be practical for Bitcoin hodlers to migrate their entire holdings to Lightning, as many Lightning wallets are custodial, meaning users must rely on a trusted third party to hold their funds. While this custodial approach may be suitable for small amounts that users are likely to spend, many Bitcoiners will feel uneasy about not having self-custody of their bitcoin. Additionally, achieving self-custody of a substantial stack on Lightning would require significant technical knowledge and still necessitate dealing with the Bitcoin timechain. However, the appeal of low transaction fees has driven some Bitcoiners to explore alternative solutions.

A particular challenge faced by Bitcoiners who follow a dollar-cost averaging (DCA) stacking strategy is withdrawing small amounts, ranging from $5 to $100 worth of bitcoin, from exchanges to the timechain. This practice often leads to a buildup of numerous and small unspent transaction outputs (UTXOs), complicating coin control management and potentially leading to higher fees when combining UTXO inputs for larger transactions. Consequently, alternative low-fee options have emerged to address this issue.

Liquid-Bitcoin (L-BTC) on Blockstream’s Liquid sidechain and wrapped bitcoin (WBTC), an ERC-20 token on the Ethereum network, are two prominent alternatives that aim to enhance liquidity and functionality while, in theory, minimizing transaction fees. Let’s delve into the differences between L-BTC and WBTC, as well as the pros and cons of each:

Liquid-Bitcoin (L-BTC) On Blockstream’s Liquid Sidechain:

Wrapped Bitcoin (WBTC) On Ethereum:

  • Originally jointly initiated by Kyber, BitGo, and the now defunct Republic Protocol (REN), WBTC is an ERC-20 token on the Ethereum blockchain, utilizing Ethereum’s smart contract functionality to lock up bitcoin and issue WBTC tokens.
  • WBTC’s governance involves multiple entities that form part of a decentralized autonomous organization (DAO), merchants who provide liquidity, a single custodian, BitGo, who holds the bitcoin reserves, and token holders who participate in voting.
  • WBTC benefits from the extensive Ethereum ecosystem (if that’s what you’re into), enabling seamless interoperability with Ethereum-based decentralized applications (dApps) and smart contracts.
  • Faster transaction transfers and cheaper fees compared to Bitcoin’s main chain.
  • Pros of WBTC: Integration with the Ethereum ecosystem, wider availability of so-called “decentralized” applications, decentralized governance involving multiple stakeholders, and the ability to leverage Bitcoin’s liquidity within the Ethereum network.
  • Cons of WBTC: Slower transaction confirmations and higher fees during network congestion on the Ethereum network, reliance on a single custodial entity for holding bitcoin reserves, and the need to trust the custodian. In contrast to L-BTC, WBTC carries less certain counterparty risk, as its governance is not as well defined. You cannot run your own node, and peg ins and peg outs are solely dependent on the WBTC merchants. Finally, WBTC merchants are required to perform KYC / AML procedures to verify the user’s identity.
  • Note: WBTC has some limited use for those using the Tron protocol.

Regarding possible failures or potential risks, it’s important to note that both L-BTC and WBTC rely on trusted intermediaries and custodians for their operations. Failures in custody, governance, or regulatory compliance could pose risks to users’ funds or the stability of these systems. While there have been no major reported failures, risks exist and users should exercise caution and perform due diligence when engaging with L-BTC or WBTC.

It bears noting that 11 of the 15 Liquid Federation functionaries would need to collude in bad faith to rug-pull users from their pegged-in bitcoin, thereby, reducing the possibility of acting in bad faith. The way by which a rug-pull would take place in WBTC is less certain, but with only a single custodian of their locked-in BTC, a central point of failure is one of WBTC’s major weaknesses. What is evident is that for both L-BTC and WBTC, there are increased risk trade-offs from self-custody.

From a Bitcoin-only perspective, using L-BTC or WBTC may raise ethical implications, as it could be seen as deviating from the original vision of Bitcoin as a standalone, decentralized network. Bitcoiners could argue that tokenizing Bitcoin undermines the core principles of the network and introduces additional risks and complexities. They emphasize the importance of Bitcoin’s sovereignty, security, and censorship resistance.

However, proponents of L-BTC and WBTC may contend that tokenized versions of bitcoin can enhance liquidity, scaling, and functionality, thus benefiting the overall ecosystem. Both tokens could be alternatives that allow bitcoin hodlers to access the advantages of other blockchain networks — such as faster transaction confirmations, interoperability with dApps, and additional financial instruments.

WBTC has an advantage over L-BTC when accessing other crypto ecosystems and activity. However, Blockstream’s Liquid Network provides a platform where L-BTC can be exchanged for various digital assets, including stablecoins like USDT (tether) and L-CAD (Canadian dollar-denominated gift certificates issued by Bull Bitcoin). This feature enables users to access different digital assets and expands their options for trading, remittances, and other financial activities within the Liquid ecosystem.

Additionally, as per previous announcements, the Liquid Network will be utilized for the issuance of the El Salvador Bitcoin Bond (recently amended to a Volcano Mining Equity). This demonstrates the network’s capability to facilitate the issuance and management of tokenized financial instruments, further expanding the use cases beyond simple asset exchange.

Everything considered, L-BTC is a superior option compared to WBTC due to its distinct advantages over transaction fees and the speed of transfer times. While WBTC relies on the Ethereum (and Tron) network, which are prone to frequent congestion issues and high fees, L-BTC provides faster and more cost-effective transactions. By leveraging the Liquid Network, L-BTC offers low fees, quicker confirmations, and improved scalability, making it a more efficient and practical solution for willing bitcoin holders. With L-BTC, users can enjoy the benefits of Bitcoin’s main chain while bypassing the limitations and challenges associated with WBTC on the Ethereum network.

To make the most of L-BTC for the purpose of low fees, it is well-suited for short-term and medium-term holding strategies.

Three-Step Process To Leverage The Benefits Of L-BTC

  1. Withdrawal from exchange to L-BTC: There are a number of exchanges which support L-BTC and allow you to withdraw directly to a wallet that supports L-BTC (Green Wallet or Aqua). This allows you to bypass additional conversions or transfers, ensuring that you retain the advantages of L-BTC throughout the process. An additional advantage is an option to store L-BTC in cold storage with a hardware device such as Blockstream Jade.
  2. Wait for ideal UTXO denomination: Keep adding to your L-BTC stack until you accumulate a sufficient amount of satoshis to create a desirable unspent transaction output (UTXO) denomination. This step helps optimize coin control and simplifies future transactions.
  3. Peg out using SideSwap or a similar service: When transaction fees are low you should peg out to reappropriate the funds back to the Bitcoin main chain. You can utilize a service like SideSwap, which facilitates the conversion of L-BTC to BTC, taking into account the conversion fee of around 0.1%. It’s important to consider this fee when planning your transactions to ensure accurate cost calculations.

By following this flow, you can effectively utilize L-BTC for short-term and medium-term hodling, and take advantage of its low fees and faster transaction confirmations. This approach can be particularly useful in a permanent high-fees environment, where L-BTC offers a cost-effective solution compared to on-chain Bitcoin transactions.

Currently, popular Bitcoin exchanges like Swan, Strike, CoinCorner, Relai, Amber, River and Bitonic do not currently have support for L-BTC withdrawals. However, just like many have integrated Lightning withdrawals, they will likely respond to a demand for L-BTC.

For Bitcoin hodlers seeking an alternative to the main chain, L-BTC offers a compelling option compared to WBTC on Ethereum. L-BTC’s advantage lies in its utilization of bitcoin itself, ensuring a closer alignment with the principles and vision of the Bitcoin network. By leveraging L-BTC, users can benefit from faster confirmations, enhanced privacy features, and compatibility with other assets on the Liquid sidechain. From the perspective of preserving the integrity of Bitcoin’s core principles, L-BTC stands as a preferable choice for Bitcoin hodlers seeking alternative low-fee options while maintaining a direct connection to the Bitcoin network. 

Ordinals Are An Attack On El Salvador’s Bitcoin Mission

Support for a government-supported Ordinal collection from El Salvador demonstrates misunderstanding of what Bitcoin is really for.

This is an opinion editorial by Jaime García, a Salvadoran-Canadian Bitcoiner and co-host of Global Bitcoin Fest.

The hype around Bitcoin NFTs, made possible through inscriptions that use the Ordinal protocol, is undeniable. Trader and art dealer Steven Hay has even suggested that the government of El Salvador release an official Ordinal art collection to potentially raise money to fund its proposed Bitcoin City or otherwise accelerate Bitcoin adoption.

Unfortunately, this suggestion seems to lack an on-the-ground Salvadoran perspective and, in my view, is a blatant attack on El Salvador’s Bitcoin objectives.

El Salvador turned to Bitcoin because of the qualities that make it sovereign money, one that is not beholden to foreign powers or organizations. While a couple of the leading value propositions for using Bitcoin in El Salvador are to attract private, foreign investment and to spur tourism, the promise of hard money that is unconfiscatable, uncensorable and resistant to manipulation is why El Salvador made bitcoin legal tender.

However, Ordinals do not provide any of the hard money benefits of Bitcoin.

NFTs On Bitcoin Are As Bad As NFTs Elsewhere

The Bitcoin community has seen recent, vivid examples demonstrating that NFTs are bad investments.

For example, a Malaysian investor who bought Jack Dorsey’s first tweet NFT for $2.5 million struggled to find bids when he later tried to sell it. Even El Salvador President Nayib Bukele appeared to recognize the lack of real value in NFTs as he auctioned his tweet announcing the country’s Bitcoin Law approval in its legislative assembly — the NFT was never sold and Bukele did not pursue the endeavor any further.

Numerous maximalists and Salvadorans have been discouraging Bitcoin NFTs because they believe that folks who get rug-pulled could suffer significant financial harm. For many of these critics, defending Bitcoin’s social layer and calling out potential scams is essential to keeping the Bitcoin network secure.

There are several key elements that critics consistently bring up, which could demonstrate that Bitcoin NFTs on the Ordinal protocol are grifts and no different than NFTs on other protocols. These are as follow:

  1. The hype around NFTs is arbitrarily assigning exaggerated values to things that are not inherently scarce.
  2. The Ordinal protocol cannot actually track individual satoshis as claimed by the creators and promoters of the protocol.
  3. The Bitcoin protocol is unaware of the inscriptions or Ordinals, so none of it is verifiable by the network.
  4. There are debatable concerns on the impact of inscription activity on storage resources of node runners.
  5. The NFTs scams are a significant distraction from the integrity of Bitcoin’s primary purpose.
  6. Finally, the intellectual dishonesty that markets Ordinals as “art investment” that will increase in value over time.

Taking the above elements into account, an El Salvador Ordinals buyer risks purchasing an expensive, low-quality, reproducible image that’s likely to decrease in value. While there is a valid argument that the marketplace will decide whether it wants such a digital product, critics point out that people should be aware of the inherent grift of the NFT space and the similarities to promotions of Ordinals.

To paraphrase the creator of Timechain Calendar, TC, who has spoken on this topic in several Twitter Spaces conversations that I’ve heard, “A blockchain makes a very poor database. It only works in Bitcoin because it is only verifying the truth about Bitcoin transactions.”

Another Bitcoiner, Magoo, has opined in similar Twitter Spaces that adding engineering complexity to the Bitcoin timechain or any software is congruent with increasing possible attack vectors. These attack vectors can appear not only in the network itself but also in the social layer. As such, Ordinals have the potential to manifest attack vectors in each of these layers. It has encouraged people to focus their energy on an activity that Bitcoin was not designed or optimized for.

Ordinals Contradict Proof Of Work

While the CEO of BTC Inc (which operates Bitcoin Magazine), David Bailey, has argued that Bitcoin NFTs on the Ordinals protocol are compatible with Nakamoto consensus, they are antithetical to Bitcoin because their marketing suggests that they will increase in value, and that violates the concept of proof of work.

In the same line of thought, Hay proposed that a government Ordinal collection would be all benefit and no risk, implying that it’s easy money — but the principles behind proof of work demand that money should not be easy to generate through natural law.

Saifedean Ammous wrote about this topic in several sections of his book “The Bitcoin Standard,” emphasizing that creating hard money requires an effort to provide value and benefit to the market and society. Ordinals are a high-time-preference activity based on easy money and speculation; therefore, encouraging El Salvador’s Bitcoin adoption acceleration by releasing an Ordinals collection is peak fiat mentality.

Salvadorans Don’t Need Ordinals

El Salvador has a rich pool of artistic talent, including musicians, actors, filmmakers, dancers, folklorists, writers, architects and visual artists. Those Bitcoiners eager to help the country with its adoption will do well to support the existing artist community by promoting them and paying for their crafts by using bitcoin.

As a starting point, Bitcoiners can go to the National Artisan Market, where people can find paintings, indigo-dyed apparel, hammocks and sculptures. Bitcoiners can also provide opportunities to digital artists, such as graphic designers, through contracts for working on web projects, apps and in print, and they can support digital content creators by giving value-for-value tips for their published works.

Ultimately, Salvadorans are more concerned about improving their day-to-day situations than collecting JPEGs on mobile phones. The everyday Salvadoran demands that their government focus on security, infrastructure, public transit, traffic, health and education. Therefore, issuing an NFT collection is far from what Salvadorans value.

Given that El Salvador has had relatively positive success with its Bitcoin adoption, it’s easy to forget that its current government had a rough start and faced much criticism with its formal Bitcoin adoption launch.

Many criticized the government’s release of the Chivo wallet over insufficient accompanying education and the technical challenges experienced by some users. The primary recipient for much of this negative feedback was not the government itself, but Bitcoin as a whole, thereby hindering Bitcoin adoption.

Heading into Bitcoin’s second anniversary as legal tender in El Salvador, some of the negative perceptions created around Bitcoin are finally beginning to fade. But if the government were to release a Bitcoin NFT collection, that would only rewind the progress made.

The government must not promote Ordinals or NFTs, as many perceive them as scams. El Salvador needs to generate confidence and trust, and when Ordinals, like NFT projects of the past, inevitably crash, El Salvador cannot be associated with them. Unfortunately, any negative perception about Ordinals would lead to reputational damage for the country, which is precisely where the attacks on Bitcoin adoption continue.

The Bitcoin Mission is Clear

The Ordinals lobby has mounted an all-out psyops front, particularly as specific groups of altcoiners are claiming that they are making Bitcoin “fun again.” Additionally, some are trying to gain favor and buy influence by donating proceeds to non-governmental organizations (NGOs) NGOs like the Human Rights Foundation, which has been critical of El Salvador.

Despite being inundated with all of the Ordinal noise, it is refreshing to see folks like South Africa’s Bitcoin Ekasi work toward the Bitcoin mission with absolute clarity. In a recent tweet, the Bitcoin Ekasi team said it is “not here to have fun” but to change the world. There is a real chance of failure for groups like Bitcoin Ekasi due to these distractions from the primary mission of adopting the hardest money in the world. With that same level of clarity, El Salvador must remain undeterred from these attacks.

This is a guest post by Jaime García. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.