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World Bank disapproves of Bitcoin and refuses to help El Salvador’s cryptocurrency plan

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World Bank disapproves of Bitcoin and refuses to help El Salvador's cryptocurrency plan

Last week El Salvador’s government passed a law accept bitcoin as legal tender next to the US dollar. The country receives $ 6 billion in deliveries per year – a quarter of its gross domestic product – and it is hoped that bitcoin’s lower transaction costs could increase that amount by a few percentage points.

As part of this initiative, El Salvador will even use volcanoes to mine Bitcoin sustainably. However, the World Bank does not approve of Bitcoin and refuses to help with the plan.

PUB

Bitcoin in El Salvador is not supported by the World Bank

If a critical moment has come for cryptocurrencies, then this is it. After an astronomical assessment, the economic situation and some positions held leave doubts and uncertainties about the future of cryptocurrencies.

Despite some countries "punished" those who bet on this currency, others like El Salvador, have even declared it legal tender next to the dollar.

The change was originally proposed by the country's President Nayyib Bukele, who expressed the hope that, in addition to helping lower remittance rates, the Bitcoin plan will attract investment and provide savings for residents, about 70% of whom have not. stored in banks - what Bukele did not say, but what Bloomberg does reported, is that he and members of his political party have owned bitcoins for years.

Adding a cryptocurrency to the list is no easy task, however, and the new law gives the country just three months to roll out the plan nationally. No country has ever used Bitcoin or any other cryptographic currency as legal tender, and there are many problems.

President Salvado Naib Bukele. Photo: Stanley Estrada / AFP

Environmental concerns and lack of transparency hurt cryptocurrencies

To respond to these concerns, El Salvador turned to the World Bank and the International Monetary Fund for help; the latter is currently reviewing the country's request for funding of US $ 1.3 billion.

The IMF has left a cautious assessment of the movement of bitcoins in El Salvador.

The adoption of Bitcoin as a legal currency raises a number of macroeconomic, financial and legal issues that require very careful consideration.

Said IMF spokesman Jerry Rice in the conference Press release.

However, the World Bank was less generous and stated that Bitcoin, like other cryptocurrencies, is not on this organization's horizon.

We are committed to helping El Salvador in a variety of ways, including monetary transparency and regulatory processes. While the government has approached us for help with Bitcoin, this is not something the World Bank can support given the environmental and transparency shortcomings.

World Bank spokesman said Reuters...

In other words, the energy requirements for mining cryptocurrencies and their ease of use. money laundering, tax evasion and other illegal schemes make cryptocurrency "taboo" in the eyes of the World Bank.

Unstable currency continues to scare regulators

There are other reasons why the World Bank and IMF may be skeptical about El Salvador's proposal to use bitcoin. Technical issues are important. In fact, the price of bitcoin against the dollar has been very volatile.

How to set the price of a dozen eggs in bitcoin if the bitcoin price fluctuates by 10% in a few hours? Maybe there is no answer. At Bitcoin Beach in El Zonta, El Salvador, where the use of bitcoins is relatively widespread, sellers still value their products in dollars and the exchange rate is set at the time of purchase.

It looks like this approach is what the El Salvadorian government is using, but it views bitcoin more as a symbol than a real currency. Also, bitcoin transactions can be very slow. Each of them must be verified by miners and miners only process blocks of transactions, not individual ones.

Thus, both parties must wait for the block to complete in order to confirm the purchase in Bitcoin. It currently takes about 10 minutes to add a block to the blockchain.

Finally, while Bitcoin transactions can be cheap or even free, there is usually a fee involved. Fees are optional, but they encourage miners to verify the transaction. Also, if Salvadorans want to exchange their bitcoins for dollars, there are fees associated with that as well. So, in the end, the system will not be free.

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Economy

Reduced provider discount in December due to falling fuel prices

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Reduced provider discount in December due to falling fuel prices

The Ministry of Finance reported that in December there is a decrease in the ISP discount by 3.9 cents per liter of diesel fuel and 2.4 cents per liter of gasoline, taking into account falling prices.

The guardianship statement states that, as announced, “the mechanism applied in the ISP is equivalent to reducing the VAT rate from 23% to 13%, and the compensation mechanism through the ISP reduces additional VAT income as a result of the changes. in fuel prices remain in effect.

Thus, taking into account the evolution of diesel and gasoline prices, “these temporary measures result in a reduction in the ISP rebate of 3.9 cents per liter of diesel fuel and 2.4 cents per liter of gasoline. a discount of 17.1 cents per liter for diesel ISP and 15.4 cents per liter for gasoline ISP,” the same note reads.

On the other hand, “the carbon tax update will be suspended until the end of the year,” and “taking into account all the measures in place, the reduction in the tax burden is 27.3 cents per liter of diesel fuel and 24.7 cents per liter of gasoline. “.

The government’s rebate mechanism assumes that a decrease in the price of fuel results in an increase in the Tax on Petroleum Products (NPT) due to a drop in VAT revenues.

“Measures to mitigate the increase in fuel prices remain in place in the month of December, while the government continues to support all consumers by reducing fuel taxes,” the ministry reminded.

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The ISP’s rebate, equivalent to a 13 percent VAT rate cut, was due to run until September 4 but was later extended through the end of the year as part of the government’s family relief package due to price hikes.

Average fuel prices have returned this week to below pre-war levels in Ukraine on Feb. 24, with a 5.1% drop for petrol and 4.1% for diesel calculated by ERSE.

According to the “Weekly Report on the Surveillance of Selling Prices for the Public” published on Monday evening by the Entidade Regladora dos Serviços Energéticos (ERSE), “For the week of 28 to 4 December, the effective pre-tax price is 0.860 euro/l. [euros por litro] for straight petrol 95 and 1067 euro/l for direct diesel”, which after tax is 1660 euro/l and 1685 euro/l for straight petrol 95 and straight diesel, respectively.

These figures are comparable to average prices of 1,816 euros/l for 95 straight-through gasoline and 1,660 euros/l for direct diesel filled on February 24 when the Russians invaded Ukraine, according to the Directorate General of Energy and Geology (DGEG). ).

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Economy

The unthinkable happens and the Lufthansa Airbus A380 takes off again two years later.

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The unthinkable happens and the Lufthansa Airbus A380 takes off again two years later.
Image: Lufthansa


This Friday, December 2, 2022, a moment occurred where few expected it to happen again. After repeated claims that the giant Airbus A380 is being retired for good, German airline Lufthansa has come back and decided to put it back into service two years later. As a result, one of the aircraft, registration D-AIMK, parked in Teruel (Spain), flew to Frankfurt.

According to the German company, the aircraft has been at the Spanish airport since May 2020, and since May of this year, more than 3,000 hours of work have been spent on its re-flight preparation. The same service is being performed on three other A380s that the company intends to restore to its network.


However, more work is needed before the aircraft is ready to fly with passengers again. Although additional landing gear maintenance was still required, today’s flight was to be flown at a much lower speed than usual and was performed with the landing gear down.

At the Lufthansa base in Frankfurt, the aircraft will be put on supports so that the landing gear retraction system can be tested. The aircraft will then fly to Manila in the Philippines, where Lufthansa Technik maintains a maintenance base, to undergo final repairs before release.

The Airbus A380 is scheduled to enter service in the summer of 2023 on high-demand flights from Munich. Videos were taken of the departure of the world’s largest passenger aircraft from Teruel (above and below, awaiting loading). Tracking Radarboxin turn, captured the entire flight.

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Economy

Prices for the next week (from 5 to 11 December)

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Crédito Habitação Activo Bank

Fuel price information is based on calculations that take into account quotations on international markets and other factors taken into account when pricing fuel in Portugal. This is the data that I collect weekly from my sources in the fuel market.

I remind you that despite this price indication, each filling station can set the price it considers appropriate🇧🇷 Only private label gas stations should follow brand guidelines. Dealers and each brand may or may not follow the market leaders. But in my experience they go one after the other. This is the price trend for the coming week.

PORTUGAL continental

🇧🇷 Previous weeks*: (-5)(-10)(-7)(4)(-1)(-0.5)(9.5)(11)(+2)(-7)(+1 )(-7)( 11)(5)(-2)(-9)(-1)(-6)(-7)(-9)(-3)(6)(13)(12)(2 .5 )(-2.5 )(-7)(3)(-10 ISP drop)(6)(1)(-5)(-12.5)(16)(-18)(18)(14 , 5)(2.5)(1)( 0.5)(2))(0.5)(3)(2)(2.5)(3)2022

* Order of changes from newest to oldest.

🇧🇷 Previous weeks*: (-5)(-9)(-4)(2)(-1)(-6)(6)(8)(2)(-0.5)(-0.5) (-7)(0.5 )(-1)(-1)(-9)(0.5)(-5)(-5)(-8)(-1.5)(-1)(- 5) (-3)(14)(1.5) (7)(2)(4.5)(-10 ISP drop)(2)(0.5)(-4)(7)(-13, 5 )(14)(7.5)(2)(1)(2)(2) (1.5)(2)(1.5)(0.5)(4.5)2022

* Order of changes from newest to oldest.

| Previous weeks*: (=)(-1)(=)(=)(-1)(=)(1)(-2)(=)(-1)(+2)(=)(=)(= )(-1)(=)(-1)(=)(=)(=)(1)(=)(-2)(1)(=)(-2)(=)(-4)(= )(=)(=)(-1)(=)(-2)(-6)(-10)(21)(=)(12)(=)(=)(1)(=)(-1 )(=)(=)(2)2022

* Order of changes from newest to oldest.

MADEIRA

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