The President of El Salvador, Nayib Bukele, called Bitcoin an asset that could counteract Ponzi schemes and the FTX incident.
As previously known, FTX was one of the most prominent players in the crypto world until its collapse on November 8, 2022.
The cause of FTX’s bankruptcy was due to its unexpected and unprecedented liquidity crunch, destroying many retail investors.
Nayib Bukele Calls Bitcoin Not Ponzi
Bukele is known as an ardent adherent of Bitcoin in El Salvador. Hence, he said that Bitcoin, as his flagship cryptocurrency, was designed to prevent Ponzi schemes and bank runs.
Bitcoin is known to be open source, where the public can verify every transaction.
Therefore it is different from a Ponzi scheme, where investment funds can still be hidden. Thus, the Bitcoin protocol was created precisely to prevent Ponzi schemes.
Additionally, his message in favor of Bitcoin reiterated that Bitcoin has a limited market cap of 21 million, making it a scarce global asset to own.
He also believes investors still have time to use Bitcoin to prevent cases like FTX.
The President of El Salvador Does Not Own Bitcoins in FTX
While investors and investors have fallen victim to FTX, Binance CEO Changpeng Zhao (CZ) responded that Bukele does not store Bitcoins in FTX accounts.
At a glance, the State of El Salvador is known as the first country to use Bitcoin as a legal tender by owning 2,381 Bitcoins, based on Bloomberg.
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