I am unsure if they are connected - so parking this here while we think.
There is also something going on with the Argentinian playbook - which I am planning to publish in a newsletter.
I am no expert - but my spidey senses are up … Bitcoin, Argentina, El Salvador .. OR, it’s all summarized thus ….
Bitcoin
El Salvador introduced bitcoin as legal tender in 2021 and then - as now - one Tim Draper has oft’ spoken breathlessly of how cool it is that a sovereign nation has adopted it.
Tim Draper Expects Bitcoin to Transform El Salvador Into One of the Richest Countries in the World.
The flag waving by Tim has never stopped.
That Said
- El Salvador’s experiment with Bitcoin as legal tender since 2021 has had mixed results.
- Only 8.1% of the population have used Bitcoin for payments by 2024.
- Seperately, the initiative faced criticism for its volatility, lack of transparency, and limited impact on remittances, which make up a significant part of the economy.
- Even so, El Salvador’s Bitcoin investments turned profitable by late 2024 - BUT the government has not recouped the costs of promoting the cryptocurrency.
- So, in December 2024, El Salvador agreed to scale back Bitcoin policies to secure a $1.4 billion IMF loan (Dollars speak) which included making Bitcoin acceptance voluntary and reducing public sector involvement in Bitcoin-related activities.
- Despite all of this by the end of 2024, its holdings surpassed 6,000 BTC which seems to have grown to 6,055 BTC as of February 1, 202. Value? Over $612 million.
Perspective
In a recent Bloomberg interview, Michael Saylor, executive chairman and co-founder of MicroStrategy, revealed that beyond his company’s holdings, he personally owns at least 17,732 Bitcoin, currently valued at approximately $1 billion.
Yup - Saylor personally owns 150% more Bitcoin than The country of El Salvador - and let’s not forget that his company MicroStrategy owns another 471,107 bitcoins.
Question
Why do we still trumpet the El Salvador story?
Prisons
El Salvador’s Terrorism Confinement Center (CECOT) is the largest prison in Latin America, with a capacity to hold 40,000 inmates. The facility spans 410 acres of land, with the prison complex itself covering 57 acres (approximately the size of seven football stadiums). It features eight cell blocks and extensive security measures, including electrified fences, reinforced walls, and 19 guard tower. It was built in late 2022 during a large-scale gang crackdown and officially opened in January 2023. Population of El Salvador - 6.5 million The USA has a total prison capacity across federal, state, and local facilities that can house 1.9 million people in federal prisons, correctional facilities, state prisons, local jails, and other detention centers.
Today’s News
# Could US criminals be sent to El Salvador’s mega-jail?
President Nayib Bukele confirmed that he had offered the United States of America the opportunity to outsource part of its prison system". Putting aside the legal questions of exporting US citizens to another country’s prison system - I am wondering what’s going on.
Back Of The Napkin - Capacity
- El Salvador : 6,500,000/40,000=162.5 - in just a single prison
- USA : 350,000,000/1,900,000=184.2 - total capacity
Back Of The Napkin - Prisoner Count
- El Salvador : 1,086 prisoners per 100,000 people in the population
- USA : 531 prisoners per 100,000 people in the population