El Salvador’s president, Nayib Bukele, describes Bitcoin as the antithesis of FTX and compares FTX to a Ponzi scheme after the collapse of the exchange on November 14.
El Salvador’s president, Nayib Bukele, rushed to Twitter to declare the Bitcoin protocol to be the polar opposite of FTX and to compare FTX to a Ponzi scheme after the collapse of the exchange on November 14.
Bukele, an ardent supporter and believer in Bitcoin, said that the flagship cryptocurrency was created to eliminate Ponzi schemes, bank runs, and fraud perpetrated by financial organizations.
The President noted Enron’s misuse of accounting procedures to exaggerate sales and hide debt in its subsidiaries in 2021, Bernie Madoff’s $64.8 billion Ponzi scheme in 2019 and, most recently, Sam Bankman-(SBF) Fried’s hidden transfer of client cash to Alameda Research.
The Bitcoin blockchain is an open-source platform upon which each transaction can be independently verified by the public, in contrast to a Ponzi scheme in which investment money is kept secret.
Last week, rumours that Bukele stashed the country’s crypto assets on the defunct FTX were circulating, but Binance CEO Changpeng ‘CZ’ Zhao promptly dispelled them through a tweet on November 11.
However, the amount Bukele and his administration spent on Bitcoin shopping sprees using public funds after Bitcoin became legal cash in the nation was never reported.
The Development bank of El Salvador, BANDESAL, denied a second request from the country’s Anti-Corruption Legal Advisory Center (ALAC) to publish the government’s Bitcoin purchase and sale data on October 31, 2022.
Currently, the nation possesses 2,381 Bitcoin, or around $39.8 million, according to statistics from Bloomberg Economics.
Bloomberg Economics also ranks the government as one of the most susceptible developing market nations to default on its debt. So far, Bitcoin acceptance in the nation has been modest.
According to a poll conducted by the Chamber of Commerce and Industry of El Salvador in March 2022, 86% of companies have never performed a Bitcoin sale, while just 20% of firms accept Bitcoin and only 14% of respondents have used Bitcoin transactions since it became legal money in El Salvador.
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