Bitcoin advocate floats BTC as solution to US student loan woes

Following US President Joe Biden’s announcement of a student loan forgiveness plan that aims to cancel up to $20,000 in debt for millions of Americans, a Bitcoin (BTC) supporter suggested an alternative method to pay off the loans.

Dennis Porter, CEO of the non-profit organization called Satoshi Action Fund, tweeted that there is another way for the US government to solve the student loan problem. According to Porter, Biden can give each debtor some BTC worth $10,000 and lock it inside a smart contract for 10 years. The non-profit director explained that the contract should be sufficient to pay off the remaining balance when released.

Community members criticized Porter’s mention of a smart contract as some believe the Bitcoin network cannot support this. A Twitter user black ports and encouraged him to not just “lump random things together”, while another said that BTC is not the solution to everything.

… I know you think this is smart … but what do families do with the debt they can’t pay for the 10 years. Bitcoin is great, but it is not the solution for everything. Read the room, my guy.

— Degen (@PennDusko) 24 August 2022

In a response to the Twitter thread, fintech CEO John Wingate said told Porter that this cannot be done with just Bitcoin. Wingate also asked Porter if this is his admission that BTC needs to expand its use cases.

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Despite the criticism of smart contract compatibility for Bitcoin, Porter stood by his proposal and defended his stance. The manager also shared a link to a guide that describes a method of how smart contracts can be used to timelock Bitcoin:

“Got you Dennis! You said smart contract! Bitcoin cannot do smart contracts!”

Error. You can unlock bitcoin with a bitcoin smart contract. It is literally the center of the existence of the lightning network. https://t.co/NcjbpX6vur

— Dennis Porter (@Dennis_Porter_) 24 August 2022

Porter’s proposal may be based on the assumption that Bitcoin will act as a hedge against inflation and that its value will increase over time, enough to pay off student loan debt. But for BTC to become an effective inflation hedge, Skybridge Capital CEO Anthony Scaramucci believes that Bitcoin needs to be in the “billion-plus zone” in terms of number of users.