Second, legality is subjective around the world. It is currently illegal in the US to gamble online, for some reason, even though casinos and lotteries are a thing.
It is illegal in many countries to transfer a certain amount of money out of the country, for some reason.
Certain sexualities are illegal in quite a few countries.
Illegal != bad
I'm saying: you need the blockchain if and only if you are doing things that are illegal in your country. It's a decision criteria for when you need the blockchain.
I'm making no moral judgement. And there are very good reasons to want to do things that your government deems illegal (for example, donating to a political organization that has been blacklisted)
That's an improvement over the existing system. I don't have to trust anyone in between to get my money to him.
How would that be as possible and as "trustless" without blockchain?
Right now Coinbase is charging me $59 to buy 1 BTC, and I don't know how much more it would be to sell exchange that back to JPY.
You can send $4000 (about 1 BTC) to someone in Japan for $30.14 with TransferWise.
And guess what? Last time I had to send money to my family in Europe, that's exactly what I did.
2. Regarding trust:
> don't have to trust anyone in between to get my money to him.
Yes you do. Both your friend and you need to trust your Bitcoin exchange. Which sometimes, cannot be trusted. Remember Mt Gox?
a. If you do not currently own Bitcoin and want to own it there are many ways you can get it. They range from fast (generally more expensive) to slow (generally less expensive). Sure, if you want to buy Bitcoin on Coinbase you can do that and you will pay them a fee for that service - which I've done. You can also mine it - which I've done, be paid it in - also done, etc.
b. Secondly you are assuming that my friend can't pay for services in Bitcoin. We have both had lunch together at a restaurant in which we paid for the entire meal in BTC.
So it's an unfair statement to say my transferring of BTC to my friend costs me these fees. If you want to make the statement of "transferring USD to BTC to my friend to JPY" then sure, your statement about fees is relevant. I'm not sure suggesting that a pure BTC transfer is not an "accurate comparison" is fair.
2. See the above point. There is no trust beyond math when it come to a pure Bitcoin to Bitcoin transfer. There are plenty of things that you can buy using pure Bitcoin which I, and many of my friends, have done.
1b. Effectively nobody accepts bitcoin. It's something like 3 major merchants and around a couple thousand total, world-wide. So yes, you will be buying BTC for real money and exchanging it for real money on the other side. Pretending we live in a land of hyperbitcoinization isn't helpful.
Further, you incur huge forex risk in between the time it takes to buy, transfer and re-sell. Do it at the wrong time and you could lose tens of percentage points. The parent post understates the cost as a result.
2. Drugs.
Doesn't TransferWise rely on MasterCard? In other words, if MasterCard bans you then you wouldn't be able to send it.
I've paid for a lot of services in Bitcoin and been paid in Bitcoin. It's generally been a very smooth and enjoyable process.
You can send money to Japan using moneygram, or transferwise, or a number of other services for a lower all in cost.
At some point, miners aren't going to be paying for themselves by inflating the monetary supply, and then the cost of what they are doing is going to rise to be more than a centralised database tracking everything. Because the mining process for bitcoin is so expensive relative to updating a database controlled by trusted entities, ie, banks. And that will manifest in transaction fees.
I think that's what makes Lightning Network very exciting. I've used it a few times, and it's a very pleasant experience although definitely still early - only has a capacity of about 3 million at the moment.
In case it wasn't clear, the usecases i mentioned above (gambling, getting around capital controls) exist and are live in crypto right now.
This is, at face value, simply false.
I want to send $5 to a poor African family. I'll even relax my criteria - I'm willing to wait _up to 3 business days_ for this African family to receive my $5. I live in California.
Could you please point me towards the non-blockchain way to do this?
Please cite sources to justify your opinion because every graph I've seen has accepance going down.
1. The general excitement around Lightning Network on Twitter with Jack and tippin.me, as well as this website: https://lightningnetworkstores.com/
2. Coinbase's reported 48,000 merchants/partners reported here: https://www.coinbase.com/clients?locale=en-US
3. I frequent similar places everyday - 2 out of the 3 places that I frequent almost everyday are now accepting btc within the past 3 months - My coffee shop and bar.
4. Musing about Venezuela from crypto podcasts, and articles.
I'll admit I'm biased as I do think it's a good invention, and tend to support Bitcoin. Despite that, I am open minded and would happily check out any information that would propose things are tending in the opposite direction.
2. Coinbase merchants take out fiat like bitpay merchants because their suppliers take real money, and so does the tax man. Holding crypto exposes them to unbelievable forex risk. If they took bitcoin and held it over the last year how on earth would they pay their tax bills? Taxes are due on the face value of the crypto at acquisition.
3. That’s an anecdote.
4. Venezuela is zero sum unless you can trade bolivars for bitcoin with outsiders in which case that’d be better off with dollars by any measure. If you’re buying locally you’re moving the bags around. Real mining equipnent just gets nationalized. It’s not a solution for Venezuela or any other developing nation because you haven’t solved the initial distribution problem.
2. Whoa look at that -> You can pay your taxes in Ohio in Bitcoin. So apparently "how on earth would they pay their tax bills" means send them BTC if they live in Ohio :). Suggesting that because you can't pay taxes or pay suppliers right now with Bitcoin, and therefore it will never be useful or capable of those things is such a silly argument. I certainly don't believe we live in a world where you can buy anything with BTC right now, but like I said my statement was about us trending in that way (Still waiting on all those graphs showing the opposite by the way).
3. Damn, I forgot I can't use anecdotes to influence my opinion. Thanks for reminding me.
4. Don't ask me -> ask the data. https://coin.dance/volume/localbitcoins/VES/BTC "35,000 Bitcoin (worth around $127 million at today's prices) was traded for bolívar on the LocalBitcoins crypto exchange over the entire course of last year." Maybe they would be better off with dollars, but Bitcoin is much easier to transfer across borders, and much easier to hold on your person without signaling that you are carrying thousands of dollars.
I'm happy to talk more about crypto with you, although I'm not sure you are open to actually talk honestly about it - seeing as how you took the time to negatively respond to every post I made on this subject. If there is something that has made you so angry about Bitcoin, I'd be happy to learn it to see if I'm supporting something that I shouldn't.
I'm certainly not arguing that Bitcoin is the perfect solution, nor that it's super helpful or accessible today. But, I don't think absolutely denying any use is a smart strategy, and I'd rather have you make legitimate counter arguments where you've actually spent the time to learn things rather than the lax effort you've put in so far.
1. I spend a lot of time learning and reading about Bitcoin and the blockchain -- that's why I don't like it. The technology is fine, it's just a database with hashes. Proof of work dates back to 1997 (22 years ago) with HashCash. Bitcoin is over a decade old. In all that time, nobody has found a good use for blockchain -- at least one that isn't better solved otherwise. Think of what else has happened in 10 years to technology that adds actual value. Remember the iPhone 1 (2007)?
I didn't have to get half way through the abstract to find the problem, and it's the same exact one I pointed out. You still need an on-chain transaction to open a channel ("Instead of one blockchain transaction per channel, each user only needs one transaction to enter a group of nodes") or in this case join a group. Each person needs to do this. There are 7,000,000,000 of us and if we dedicated the entire blockchain (7tx/sec) to opening channels that would take 34 years just to open a channel (or here, join a group) for everyone on earth. The paper you linked references a paper explaining it for you, as #9 in the references [1].
The paper cites being able to reduce on-chain transactions 96% for a group of 20 people with 100 channels between them -- I'm saying we can't even get to 1 person with 1 channel to 1 other person.
2. Big difference between paying your taxes with bitcoin and paying taxes denominated in bitcoin. If you received 1BTC ($19,000) renumeration for your services January 2018 then went to pay your taxes "with Bitcoin" in Ohio April 2019, expect to pay approximately 2BTC ($7600 / 40%) in taxes. That's a 200% tax rate. If you could pay your taxes denominated in Bitcoin you'd be paying 0.4BTC ($1300) -- or 40% of unit of account, 6.8% of value. Make no mistake you're paying in US dollars, they're just providing a convenient forum for exchange. I'd image they'd do the same with a goat exchange if people decided to be equally backwards and everyone wanted to start using goats as payment.
3. Anecdotes aren't really worth much. It's just as irrelevant as my telling you 100% of the places I frequent don't take bitcoin. I don't hold that up though, I look for studies.
4. Re: LocalBitcoins and the bolivars, if they were traded with foreigners, they'd be unequivocally better off with a USD denominated account and a debit card. They'd have saved (up to) 80% of their net worth relative to what they did. But who on earth would take their bolivars? Zero sum.
If they traded it with each other the same amount of net worth was lost because the total number of BTC in Venezuela and the total number of bolivars remained unchanged, all that changed was who had them. No problems were solved by Bitcoin here.
[1] http://diyhpl.us/wiki/transcripts/scalingbitcoin/hong-kong/o...
https://www.westernunion.com/us/en/send-money/app/start?SrcC...
If not WU, there's probably some other remittance company operating in their area. The fees might be pretty exorbitant though, especially for small amounts.
(1) Since the African nation in question doesn't accept either dollars or bitcoin, you're going to have to convert the currency one way or another. Buying BTC is not cheap, you pay ~1%+ to Coinbase, so that's 5 cents right there. Transaction fees on Bitcoin are $0.36 right now. Then you're going to have to convert it to something they can spend in their local country, and good luck to you. That second transaction is going to cost them another $0.36, and so is any other transaction they may be wanting to spend the BTC in. If they're making purchases of just $1, thats a THIRTY SIX PERCENT transaction fee.
(2) Does this poor African family have a phone, laptop or computer, and access to get to their nearest BTC exchange/ATM? Are there any in your country in question?
(3) WU is $1. Other services exist and are priced competitively. Have you looked into M-PESA?
This is not only not a mystery, but common, and individual remittances from emigrant relatives are a major consideration in the economies of some underdeveloped countries.