Doesn't opago just convert bitcoin to fiat? If so this isn't the bitcoin economy. In fact its the opposite. Exchanging bitcoin for fiat isn't a bitcoin exchange for goods. Its a fiat exchange for goods.

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No, Opago is only giving a way to merchants to accept BTC through their offline POS. Funds are then forwarded to merchant self custody as they choose. If they want to "sell" those sats is their problem, Opago is not "selling" them.