Post
Topic
Board Bitcoin Discussion
Re: What if India or China declares bitcoin as legal tender in the country ?
by
d5000
on 21/10/2024, 18:14:40 UTC
It is technically impossible to make Bitcoin the main means of payment in a country with a population of over 1 billion people. As far as I remember, the Bitcoin architecture allows for no more than 400,000 transactions per day.
Even in El Salvador with their humble 6 million people they recurred to Lightning for mass adoption via the Chivo wallet when they introduced Bitcoin as legal tender. I'm sure if a bigger country even thinks about designating Bitcoin a legal tender, they would either first investigate the layer-2 landscape, or develop an own layer-2. And they could also offer a completely centralized Bitcoin sidechain, copying Blockstream's Liquid model but with institutions of the state as members of the sidechain federation.

Of course even Lightning needs some time for "onboarding". But sidechains don't have that problem. And the current sidechain landscape evolves quite well, and even if most have still centralized elements, projects like tBTC (Threshold Network), Nomic and (upcoming) Stacks are already "as decentralized as most altcoins". And there's also BitVM which can make sidechain creation even more decentralized in the future (but it needs some time).

So I don't consider the scenario impossible for technical reasons. Of course, politically it is very, very unlikely from today's point of view. However: If there's a "Bitcoin adoption race" e.g. if more countries adopt explicitly Bitcoin-friendly policies and their citizens begin to benefit from price increases, then it may not be completely impossible, above all for India.