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El Salvador Loses Half Of Its Crypto Investment In Value, As Bitcoin Crashes

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Recall that last September, El Salvador became the first country in the world to officially adopt Bitcoin as a legal tender, making the cryptocurrency an accepted means of exchange for goods and services.

The government rolled out a digital wallet called Chivo that its citizens had to download for holding Bitcoin and converting it into US dollars, which has been the country’s official currency since 2001.

Due to the volatility of the crypto market, the decision by the government of El Salvador to adopt bitcoin as a legal tender, triggered a lot of negative reactions from analysts including the World Bank and IMF. The citizens of El Salvador never liked the idea, which led to a protest, but it however fell on deaf ears, as the government was making Bitcoin its legal tender.

President of El Salvador Nayib Bukele disclosed his reason, stating that the commitment to adopt bitcoin will help the country’s struggling economy. However, many citizens claimed that the innate volatility of cryptocurrency has already negatively impacted the nation’s financial standing.

No doubt bitcoin has been the cryptocurrency with the best performance in the decade, however, the recent market has been disappointing to many investors across the world, as there is a massive decline.

Since El Salvador approved Bitcoin as a legal tender, according to calculations by Bloomberg, it disclosed that the nation has lost almost $56 million by gambling on digital assets. The country’s loss since the adoption of Bitcoin as a legal tender now represents more than half of what the government spent on purchasing it.

Despite cryptocurrency tumbling continuously, on a pace which is said to be its longest losing streak since 2014, President Bukele Nayib doesn’t seem perturbed by the bear market, as he recently hinted via a tweet that the decline may represent a buying opportunity.

From the look of things, El Salvador’s investment is rapidly losing value. Last September, the government of El Salvador purchased 2,301 bitcoin that were worth $103 million, now with the recent decline in the crypto market, they are currently worth around $51 million.

The government has kept buying the dip, which saw them purchase 500 Bitcoins last month, for more than $30,700 each. Now with the current price of Bitcoin around $23,000 which is still declining, this further shows that every dip bought by the country accrued more loss as they never made any profit.

El Salvador’s adoption of Bitcoin as the country’s legal tender attracted the attention of the International Monetary Fund (IMF) who demanded that El Salvador liquidate its bitcoin holdings and abandon the cryptocurrency as a legal tender.

This statement infuriated the government of El Salvador who issued a rebuttal statement, stating that no International organization is going to make them do anything against their will.

The World Bank on the other hand also rejected a request to help El Salvador implement Bitcoin as a legal tender, citing the environmental and transparency shortcomings.

Looking at how volatile the crypto market is, which is often controlled by individuals, it is an unwise move for the government of El Salvador to adopt Bitcoin as its legal tender. This is more like gambling away taxpayers’ money on highly volatile investments, which is not a good way to run a country.

Bitcoin was designed to be an alternative payment system, which is mostly unregulated and volatile, and is often used for speculation of prices. If Bitcoin continues to decline, the country runs the risk of losing its treasury reserve.

Apple Strikes Many Startups With Simple OS Evolution

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I wrote a piece in Harvard Business Review titled “Can African Tech Startups Succeed in a World Dominated by Facebook and Google?” and provided some insights on how startups can play in a world where ICT utilities are dominating all domains of the digital technology sector. But what Apple did this month (as noted in Apple WWDC event) has taken that ICT utility conversation to another level. In just a few minutes, Apple struck many startups; many will not recover. Here are how (Jano, Medium):

Apple Pay Later: That is the latest thing for Buy Now Pay Later with No interest. Apple’s treasury is massive. It has cash reserves many countries will dream of. With that war chest, it has unlocked another fintechnolization where all platforms attain a stable state as a fintech. Companies like Afterpay, Klarna, Affirm are victims.

Freeform: With this new feature, Apple has elevated the minimalist collaboration whiteboard buzz, taking out companies like Mural and Miro.

Passkey: A new domain of handling passwords. Companies like 1Password and Keeper have new problems now.

Tap to Pay: Apple products now support the ability to tap a wireless card or iPhone-iPhone to pay. Square, Toast and others in this space have new challenges ahead.

Apple’s iOS is a digital operating system and iPhone is a modern commerce platform. When you have such pillars under one company, many bad things could happen to small entities which depend on them. Yes, over time, Apple will abstract these services and fold them into the native system.

The problem of enforcing court judgments in Nigeria

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A man was complaining the other day about how the Nigerian Armed Forces forcefully and illegally took his landed property in the Maitama area of Abuja. For those that are not conversant with Abuja, Maitama is a high-brow area of Abuja, it is the “Ikoyi” of Abuja so any property in that area must be worth hundreds of millions of Naira if not billions. 

Some people were advising the man to go to court and sue the military to reclaim his property and the man who is quite enlightened asked his advisers; “going to court and suing the armed forces is to what end”? After spending a huge sum of money dragging a court case for years and the court finally grants him judgment how do they enforce the judgment against the military, which court bailiff or policemen can boldly go to the land which the military guards every day to kick out the military men from the property. 

As a lawyer, I saw reasons in his argument for his reluctance to go to court and why he does not want to waste his time and resources going to court. Rather, he has been applying diplomacy and calling forth anyone who can intercede on the matter to intercede on his behalf. 

This is The major problem bedeviling the Nigerian Judicial system. The problem of the enforcement of court judgments.

This issue has made a lot of persons lose faith in the Nigerian judiciary which ought to be the last hope of the common man. Aggrieved persons who know that they have a good case and should approach the judiciary to grant them the justice they deserve are always reluctant in doing that because they feel even when they have been granted justice by the court, the enforcement of that justice becomes another issue. Enforcement becomes a difficulty especially when the defendant is a government agency, top government official(s) or law enforcement agency, or other government owned institutions or parastatals.

For instance, how do you enforce a judgment against the military in a country like Nigeria where the military think they are more powerful than everybody put together in the society. Which court bailiff or police can enter the military barracks or military settlement or even the home of a military man to serve in court process or to enforce court judgment without the fear of being intimidated or being assaulted by the military.

How can you also enforce a judgment against government parastatals or agencies? 

Most times when citizens sue law enforcement agencies for fundamental human rights enforcement and judgment is granted in their Favour, the issue becomes the enforcement of that judgment. 

When the court mandates a law enforcement agency or its agent to pay a citizen a particular sum as damages for the breach of their fundamental human rights the problem becomes getting their law enforcement agency or its agent to pay.

The police, the FRSC, the VIO, the customs/immigration, the EFCC, the DSS, the armed forces, and all other paramilitary/ law enforcement agency are all guilty of flaunting court orders and refusing to obey court judgments or refusing court judgment to be enforced against them.

If we must get it right, if we must restore the faith of the citizens in the judicial system and process, the government agencies and government officials must learn to obey court judgments and let there be full enforcement of court orders to the latter against any person no matter your status or standing in the society.

We have all witnessed how law enforcement agencies and government officials flaunt court orders with so much impunity. Law enforcement agencies are fond of disobeying court orders to grant a suspect in their custody bail or release the suspect even when the court has ordered bail or ordered them to release the suspect. The DSS is always handy in cases like this, especially when the case is politically motivated.

How can an aggrieved person whose fundamental human rights have been trampled upon enforce the judgment he got against an agency like the DSS, an agency that feels they are bigger than courts or not bound by regular rules of the land? 

Top government officials must be ready to subject themselves to the judicial system and also advise their subordinates to do the same too so that citizens won’t have any reason to engage in self-help and jungle justice or to be taking laws into their own hands to fight for themselves if the judiciary can’t fight for them. 

Enforcing judgments against individuals or private institutions is not always the problem but the problem comes with enforcing judgments against government agencies or top government officials or law enforcement agencies. Which law enforcement agency can you use to enforce a judgment against a government agency which is also owned by the government. 

The principle that No one is above the law should be the watchword. Every person, every institution, and every agency should subject themselves to the dictates of the judiciary that has been charged with explaining the law and serving justice to every one according to whichever anyone deserves. 

Register for Tekedia Startup Masterclass and Understand Business with Ndubuisi Ekekwe

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Join me at Tekedia Startup Masterclass: from Start-Up to Unicorn and master the mechanics of business. CEOs, founders, innovators, project champions, workers, etc, this 8-week program will accelerate your business leadership ascension. Besides the courseware, you will have one-on-one Zoom sessions with me. It runs for 8 weeks – and it is impactful.

Come to the temple; we preach business here, and we make disciples of innovators in markets. The reward is business growth and the acceleration of wealth and the advancement of human societies.

Go here and register. You will get a link to schedule the Zoom session. I want to work with you, on your project.

We’re Tekedia Institute; we understand business – and we teach it. Hope to meet you in class.

Tekedia Startup Masterclass: from Start-Up to Unicorn is designed to help founders, entrepreneurs, and those generally working in the startup ecosystems, to master the mechanics of building category-king startups. The program runs for 8 weeks. Besides some pre-recorded courses for the 8 weeks, the program includes an hour-long one-on-one live Zoom session every week, per participant, with Tekedia Institute’s Lead Faculty, Prof Ndubuisi Ekekwe.

Business Strategy and Execution – Tekedia Mini-MBA Live

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Tekedia Institute will continue our conversation on the mechanics of market systems. Tomorrow, Microsoft Senior Manager, Eromosele Omomhenle F.IMS, will be live to educate us on Business Strategy and Execution. What is your business strategy? How is that evolving as a result of changing market dynamics? How do you execute? And what can you do to make it better?

At Tekedia Institute, we help innovators and project champions advance their missions. Come to our school and master the physics of modern entrepreneurial capitalism.

Tekedia Institute >> Learn from the best.