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Comment by trixie_ | Hacker News Reader

10 minutes is nothing. A wire transfer can take hours. A bank transfer can take days. A wire transfer might cost you 20 bucks as well. Bitcoin is amazing at transferring large sums of money quickly, internationally, for a low overhead cost. It's extremely useful for a lot of people.

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Where in the world would a wire transfer cost 20 bucks? It's practically free here unless you do something that makes the bank do extra work.

International transfers?

Even those are like 9 euros if you send over 1k.

USA: https://www.wellsfargo.com/online-banking/service-fees $30 to send a wire transfer, just within the country. And $15 to receive one too.

Why the heck do people use those kinds banks over there? Seems to me it takes away all the usefulness of one. It's a money bucket where you put money in and take money out. As soon as one of those three aspects is not there, then what is the point?

https://www.nerdwallet.com/blog/banking/wire-transfers-what-... There really isn't any low cost option for wire transfers in the US. ACH is the free transfer option, and it takes 1-3 days. Wire transfers are the "pay a lot for immediate confirmation" option just for the very few transfers it's worth it on. The average person is unlikely to ever make or receive a wire transfer. There are consumer-level alternatives for personal transfers like Venmo: https://venmo.com/about/product/

But why wouldn't you want to send or receive money using your bank? Isn't that what it is for? As a non-US person this seems really strange to me (but so is the concept of cheques and tip-based income).

I'm used to using the bank, the apps they have and de debit cards they provide (and now also Apple Pay) to send and receive money instantly every day, and there are on average ~10 instant transfers daily to both other private accounts or businesses to pay for things.

Perhaps this is an exotic or luxury position, or there is some unseen cost to this, but I'm not aware of that at this point.

A lot of merchants ask for 3+ confirmations, and sometimes 1 confirmation can even take 20 minutes. Paypal and credit cards take seconds.

And $20 for a wire transfer pales in comparison to the fees people charge for converting bitcoin to cash https://localbitcoins.com/

Yes transferring large sums of money internationally is useful, but it is a niche, and bitcoin doesn't even do it that cheaply.

Bitcoin transactions are instant. You get the 0-conf transaction instantly and are able to buy stuff. The 30 minutes for 3 confirmations are basically the 'chargeback' time, which is about 2 weeks with credit cards. In day-to-day business, people usually trust 0-conf transactions, or are able to handle the chargeback.

How does a 0-conf transaction work? I mean, without confirmations the transaction is not on the blockchain. It basically doesn't exist. Is it just a promise that I will pay a bitcoin in the future?

The seller now has the buyer-signed transaction as it will (hopefully) be recorded on the blockchain. Common wallets will also already deduct the paid amount.

It means that it has been sent to the Bitcoin network to be mined in the next block.

Could the sender simply cancel it?

No. Once a valid, signed transaction is _out there_, any miner can (and is generally incentivized to) add it to a block.

The closest thing to cancelling is making a new transaction which makes the first one invalid (e.g. by emptying the source address) and hoping the new one gets added to the block first.

Because transactions can have fees attached to them, you could presumably make it more appealing to mine the second transaction than the first, but I don't know if this is something people do, and as far as I understand it most miners prefer the first transactions they see.

to expand on the "replacing"

there is a mechanism called replace by fee, so it becomes a question of incentives

The payment processors can scan the mempool for transactions that would invalidate the initial transaction, so then it would be a question of lead time. Great for digital services etc, not so great for in life purchases.

So if you absolutely 100% need confirmation, then yeah 10 minutes is what you need to wait, but that again is a question of probability comparative to credit card chargebacks/fees etc.

Even the next block inclusion isn't a guarantee... it just means that you have at current prices approximately 200k insurance. With enough resources and luck, someone could +EV roll back your transaction, but the cost scales exponentially.

The current viable solution for small inperson transactions is pretty much replicating the banking system. Current versions of abstracting the banking system into something decentralized are clunky/buggy to say the least.

Cash handling is expensive (cash pickup logistics, compliance fees, banking fees, insurance fees, you name it). But it IS from one bearer instrument (cash) to another bearer instrument (Bitcoin) - and that’s hugely valuable. Wire transfer fee at Suntrust for instance is currently at $50, for example: https://transferwise.com/us/blog/international-transfer-sunt... https://www.suntrust.com/content/dam/suntrust/us/en/personal...

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