Mexican billionaire Salinas says his banking business may embrace Bitcoin

https://www.reuters.com/business/finance/mexican-billionaire-salinas-says-his-banking-business-may-embrace-bitcoin-2021-06-28/

by shivbhatt • 5 years ago

176 114 5 years ago

reuters.com

onion2k• 5 years ago

Salinas last year said he had about 10% of his liquid portfolio invested in bitcoin.

Billionaire buys BTC. Billionaire pumps the price of BTC. Billionaire profits. There's at least one other billionaire who plays this game.

celticninja5• 5 years ago

As a billionaire I am not sure he really needs to pump bitcoin to make a return. If you watch the interview with him he makes his case for holding bitcoin and it is a reasonable one. He says when he started his career the Mexican peso was 20:1 to the US dollar, now it is 20,000:1.

Many in developed countries don't understand the challenges of a devaluing currency with unlimited supply or the difficulty of being unbanked.

isatty• 5 years ago

Billionaires, just like everyone else, love making money.

WJW• 5 years ago

I'm pretty sure a billionaire does not need to worry about being unbanked even in Mexico. There are many other types of assets he could hold that would bring as much inflation protection as bitcoins with a fraction of the volatility. Now obviously in his particular case he's done pretty well with his hodlings because the price went up so much, but that is not guaranteed to happen again in the future and may in fact reverse. As long as it stays so incredibly volatile, holding bitcoin should be regarded as speculation first and an inflation hedge second.

mrtksn3• 5 years ago

The norm in this type of countries is to keep USD, EUR and property. Bitcoin is the way to get rich, at least the mental model is based on that.

The inflation in these countries is not because of the way their economy is structured but because lack of structure and integrity. Things are not good in these countries, people don't seek to preserve the current wealth(and fail because of their currency) but they seek to get out of poverty and those who are not in poverty seek to explode their wealth so that the can buy a mansion and a Ferrari. The richer ones seek ways to hide their wealth out of the reach of the politics because in this type of countries the political situation is usually unstable and those who get very rich are cronies. When the crown falls the cronies need to have an exit strategy(sometimes they can adopt but sometimes the new crown comes with its own people) and that usually is buying property or companies overseas. Now they have the BTC option.

Therefore, in such countries people don't really keep local currency long term already(when they do, they will do it to get interest rates that at least match the inflation). The inflation rate is relevant only when doing business deals, financing projects or purchases and adjusting employee salaries. No one is losing their wealth to inflation.

DasIch2• 5 years ago

Many in developed countries don't understand the challenges of a devaluing currency with unlimited supply or the difficulty of being unbanked.

I have to admit, being in a developed country, that I genuinely don't understand why someone would switch away from a local currency that is failing at the task of being a currency to a cryptocurrency like bitcoin that is also failing at being a currency.

rxhernandez• 5 years ago

How is it 20,000:1? Google's conversion calculator has it around 20:1 right now.

arcticbull14• 5 years ago

As a billionaire I am not sure he really needs to pump bitcoin to make a return.

What makes you think that billionaires are somehow altruistic actors no longer looking for an ROI? Especially an easy one? [edit] Or that they're immune to speculative manias?

arkitaip• 5 years ago

Billionaires routinely conspire with politicians and law makers to prevent workers from earning a few dollars more per hour, but somehow they would would be too ethical to pump and dump Bitcoin?

economusty• 5 years ago

He can still leverage the bitcoin, he may be holding and not selling but that doesn't mean he isn't borrowing against the bitcoin and using the borrowed cash to make growth investments.

pibechorro2• 5 years ago

Dont worry, they will soon. All developed countries have been bailing out banks etc by printint trillions. It will catch up to them.

Good on him. Good on Mexico. Preserving the wealth of the middle class and giving access to the poor and unbanked is tye way forward for a more egalitarian society.

joshsyn• 5 years ago

Oh this so much. So many people are envious and think being a billionaire is a zero sum game.

throw0101a• 5 years ago

As a billionaire I am not sure he really needs to pump bitcoin to make a return.

It's not about making a return, or about having 'enough'.

It's about keeping score, and the person with the highest number "wins".

nly• 5 years ago

All that matters to Mexicans is their local purchasing power though.

Inflation in Mexico hasn't been that insane for the last 10 years. You have to look at wage growth and investment returns to really make a judgement

el_nahual• 5 years ago

10% is far too much of his net worth for a pump-and-dump. A much more reasonable use case for holding ~1B worth of BTC for a man like RSP (Ricardo Salinas Pliego) is as insurance against having assets frozen or nationalized.

A man like him is sufficiently diversified in asset holdings that he doesn't really care about the fluctuations of any one (property, businesses, fx), but he very much cares about the government deciding to freeze his accounts.

It's an enormous irony (if a predictable one) that the biggest buyers of a "control your money!" story are not your wacky libertarians living in the forest, but the ultra, ultra rich, especially those who obtained their fortunes in marginal ways.

jalcazar• 5 years ago

It should read "Salinas Pliego" as "Salinas" is understood to be "Salinas de Gortari"

xtracto• 5 years ago

Is Salinas de Gortari a billionaire? I think few millennials actually know who the previous president is.

holoduke2• 5 years ago

Seems like bitcoin is a the driver for influencers to earn a little money. Without those influencers bitcoin wouldn't be followed by the 99.9% wannabee influencers and worth nothing.

errantmind2• 5 years ago

Influencers don't really shill Bitcoin, ironically because it isn't volatile enough. They shill what are known as 'shitcoins' for PnDs

villgax• 5 years ago

I just hope BTC becomes the global alternative to the USD being set as a reference for value

arcticbull14• 5 years ago

That would make the global financial system dramatically less stable.

New_California2• 5 years ago

On the contrary, the Bitcoin based global financial system would be robust, reliable, dependable, non-inflationary, neutral, and apolitical.

Note after hyperbitcoinization the volatility would be much lower than it is today, simply because it would take so much more to affect the price.

neilwilson• 5 years ago

Banks create and take financial assets and discount them into their own liabilities, which can be in any denomination they feel capable of supporting.

Since there is paper gold, it would be amazing if paper bitcoins didn't show up at some point.

swiley• 5 years ago

I honestly wouldn't be shocked if South America embraced bitcoin while North America banned it.

Cenk• 5 years ago

Mexico is in North America

gruez3• 5 years ago

Maybe "latin america" instead? In terms of "north america" mexico is definitely the odd one out.

BrissyCoder2• 5 years ago

Sure, but no one blinked and eye until you pointed it out. Everyone knows that North America really means Anglo America.

DantesKite• 5 years ago

They certainly have a larger incentive to figure it out.

corpMaverick• 5 years ago

Not good. Salinas is one of the worst oligarchs in Mexico. A text book narcissist.

adelHBN• 5 years ago

He is smart. Unlike Musk, he is buying Bitcoin when it's down.

luffapi3• 5 years ago

Musk receives billions of dollars in government handouts. Tesla and Space X could not exist without the government pouring our tax dollars on them. I don’t think it’s too far of a leap to suggest Musk’s role in destabilizing BTC came at the request of his patrons in the government.

Or he’s just incredibly stupid. Maybe a bit if both.

SantalBlush• 5 years ago

That does seem like too far of a leap, unless you have some strong evidence to support it. Did the government ask him to tweet about Gamestop, too?

outside1234• 5 years ago

"Billionaire banker sees potential to do more money laundering"

Hyolobrika• 5 years ago

This is bad for Bitcoin.

Embrace. Extend. Extinguish.

Not your keys, not your coins.

Mexican billionaire Salinas says his banking business may embrace Bitcoin

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