Hacker News Reader

Hacker News

Comment by scarface74 | Hacker News Reader

Full thread

scarface74

I’m the last person to jump on the bitcoin bandwagon, but this is one case where I think it’s warranted.

View on HN

Nothing better than receiving your salary in a token with huge minute-to-minute volatility.

Great for those of us who don't already have enough stress in our lives yet.

Sure beats not receiving a salary at all.

Crypto replaces a major painpoint (chargeback, getting 0% of your money) with a minor painpoint (volatility, losing or gaining <10% of your money).

There are other cryptocurrencies (eg Tether) that follow USD (eg 1 Tether is almost always equal to $1.00 USD), to avoid issues with volatility.

I guess another issue is that you'd have to pay taxes on any gains/losses between receiving your crypto and cashing it in for USD, and that would be pretty annoying to calculate manually.

I'm not the biggest fan of crypto but I think it actually solves this problem pretty well. There are probably other solutions too though (like only accept debit cards / payment methods that can't be charged back).

> There are other cryptocurrencies (eg Tether) that follow USD (eg 1 Tether is almost always equal to $1.00 USD), to avoid issues with volatility.

One of us is behind the times on Tether; last I heard they were in pretty significant legal/financial trouble re: money laundering, not actually having most of the backing dollars they claimed to, and possibly market manipulation.

There have been various stories floating about litigation, solvency, and market manipulation in tether. So far, the market [1] remains unconvinced: tether trades pretty close to parity (sometimes even at a premium; liquidity preferences being what they are), and prices between tether-based exchange and USD-based exchanges are also pretty tight. So for the moment accepting payment in tether USD is entirely feasible.

[1] https://trade.kraken.com/markets/kraken/usdt/usd

"All Tether tokens are fully backed by reserves."

https://www.coindesk.com/tether-says-its-stablecoin-is-fully...

Tether (USDT) $1.00 USD

https://coinmarketcap.com/currencies/tether/

What's the turn around time between receiving crypto currency and getting that into e.g. USD in a bank for you? As long as that is short, volatility is minimized.

I think the volatility issue is a major pain-point to people though. As long as you keep your money liquid in cryptocurrency, isn't it essentially holding stock (albeit driven by BTC mining and transactions) in terms of capital gains and losses? But if you use stock, I believe you are required to hold it for periods by the SEC (don't quote me, but, blah blah Holding Period?), so maybe crypto wins in this regard anyway...

Would there be a way to peg valuation to clock periods? Or a certain number of transaction counts? (Ie., between the next 1000 transactions the value must be exactly 'X'.)

It would also be interesting for the protocol to gain the ability for arbitrage. Or even negotiate whom the arbitrating party would be.

If you want less liquidity, more extreme volatility, and less buyin, sure. But what you just described (absent a central bank; like Tether) is much how dictators have tried to stabilize devaluing currencies.

Derivatives/forex and black markets would develop quickly in any major currency that did this.

AKA, nobody would logically accept your transaction until the time period or count ends, otherwise, there is a significant likelihood of them being wrong.

I lived through hyperinflation. Sometimes products were updated mid day. Comics used codes that referred to a table because it was not possible to change the price on the cover.

Giving btc a more regular market, one outside of gray- to black-market activities and speculation), would almost certainly help stabilize the value.

Bitcoin isn't good for transactions. It's too slow, too cumbersome for he average consumer and its value fluctuates so much that you'd have to have dynamic pricing.

I love the idea of crypto currency and I really do think, one day, some form of it will be out future. But Bitcoin today just doesn't fit that bill at all.

Shouldn’t there be a futures market for bitcoin like there is for commodities? Where a middleman could lock in the price and do the transactions for both sides? The middleman is taking the risk and charging a fee.

> It's too slow

In my recent experience, payments confirm ~5 times within an hour or so.

> too cumbersome for he average consumer

The BitPay wallet is very easy to use. And many sites now use payment URLs, so it's basically just click the link, and hit OK.

> and its value fluctuates so much that you'd have to have dynamic pricing.

I haven't seen anything in recent memory that doesn't use dynamic pricing. Many sellers say something like "this Bitcoin quote is good for X minutes". And the payment URL doesn't work if it's expired.

>> It's too slow

>In my recent experience, payments confirm ~5 times within an hour or so.

Really not fast enought for the camgirl/camboy use case

Why would they need 5 confirmations?

Right.

Many VPN providers issue connection credentials with zero confirmations. Because reversal is nontrivial enough that it's worth the risk.

So I guess that it'd be the same for camboys/camgirls.

> nontrivial enough

not sure I understand... did you mean trivial enough?

I did mean "nontrivial enough". That is, hard enough.

I mean, I've used Bitcoin since the start, and I don't know how to reverse transactions. I don't believe that it's easy, even in full clients.

I assumed 5 times in an hour meant once every 12 minutes.

But I admit I dont know enough about the network to understand if that even makes sense

Agreed. I'm very optimistic about cryptocurrency as tech in the longer term, but there are still a bunch of problems to be solved. The specific boosterism of Bitcoin is odd and probably counterproductive.

Their second layer network (lightning) is still very early, but it really does solve a lot of the slowness issues. I use it for purchases a few times a week, and rarely run into issues.

If you have a few minutes and a few dollars in bitcoin, install Breez wallet, and try it with a few sites like yalls.org.

Note: This obviously doesn't solve the value fluctuation problem.

> this is one case where I think it’s warranted

How will you deal with fraudulent / sketchy site operators scamming people into sending them money via irreversible payment channels?

You’re on a porn site. You expect a certain amount of sketchiness. Right now, the customers are the sketchy ones. They pay for a product and or statistically more likely to do chargebacks.

How do you avoid any fraud? Reputation. Don't send money to sketchy people.

It should be noted that Europe runs on SEPA payment system that has irreversible transactions. It's not that much of a problem.

Reputation scores only help established players. And they can be gamed. Get a bad reputation? Just dump the and spin up a new one.

Fairly simple

1. Don't pay more in one go, than you can accept losing with a shrug.

2. Check the reputation.

Reply on news.ycombinator.com