Hacker News Reader

Comment by TedDoesntTalk | Hacker News Reader

What does this mean for exchanges like coinbase? Will they lose out new customers to visa?

Exchanges like Coinbase could function like your bank and checking account you use to pay the Visa bill today. Your bill for last month is $2500 or 2500 euros, you'd like to pay with a bitcoin from your account at Coinbase. Visa calculates the exchange rate at that moment and sends a debit request to Coinbase for xxx fractions of a Bitcoin to be transferred from your wallet/account to Visa's wallet. It's a way for Visa to accumulate Bitcoin for one thing.

The other way it might work is if the merchants price things in BTC. Like any other foreign currency, they take the USD from your account and pay the merchant in BTC at the current exchange rate.

so i used to go to a bank, show my ID, open an account, wait for a bunch of random restrictions on Zelle limits to pass, ACH payments to go through for many days, and other crap to settle.

Now it's the same exact routine through Coinbase. Upload my ID, wait for them to allow me to actually move amounts more than a kid's lunch money, wait for days on end to withdraw, etc etc.

And in the end some of these payments in both flows are handled by Visa. I'm missing the "wow" part of this deal.

Absolutely. Unsure how far Visa execution is but it could derail Coinbase IPO. Coinbase charges enormous amount to buy or sale (convert) my cash to digital coins. Its all digital anyways. If I could eliminate middle man and use cards I already have - including debit cards that Visa oversees, Coinbase would literally lose 99% of wallet holders. I mean only idiot would want to pay more to buy or sell digital currency. Besides Visa has much better and more sophisticated fraud and abuse detection network than Coinbase could ever imagine because only in USA they sit on everyones social security number that is already verified thru reporting burreaus.

It will be game changer - one button in my bank online profile to hold bitcoins/other wallets all branded and protected by Visa. Coinbase needs to IPO yesterday to offload stock to the last person to turn the lights off.

Disclaimer: I am long V holder since $48/share.

How does tax work? BTC is an asset not a currency. It’s like paying for your credit card with gme stocks

This is an interesting question. You'd need to keep track of cost basis and gain, and specify whether you want to work on a FIFO or LIFO (more likely) basis.

There are online services that will do these calculations for you at tax time, like bitcoin.tax or cryptotrader.tax

https://www.irs.gov/irb/2014-16_IRB#NOT-2014-21

"If the fair market value of property received in exchange for virtual currency exceeds the taxpayer’s adjusted basis of the virtual currency, the taxpayer has taxable gain. The taxpayer has a loss if the fair market value of the property received is less than the adjusted basis of the virtual currency."

Yeah but how many people are going to understand that. And then do that for every transaction. Also it’s interesting to see what happens if you don’t actually own the crypto. Now you have a taxable gain on your visa balance... and what happens on a loss say the next month is it offset? Like if Bitcoin moons in dec and crashes in Jan there is gonna be one hell of a tax Bill

Great you get convenience for buying bitcoin but I thought one of the selling points of bitcoin was to keep payments and transactions anonymous. I don't want to have to provide ID just to buy/sell bitcoin, I certainly don't want the government to know about my transactions. I appreciate the privacy bitcoin transaction provide, why do people want to jeopardize anonymity for convenience?

Bitcoin is not anonymous. it's pseudonymous at best. It's a public ledger.

Is there an alternative that is fully anonymous?

Monero[0] seems to be aimed at that, but I have no idea if it maintains the promise.

[0] https://www.getmonero.org/

There are various "privacy coins" which aim to be used anonymously. Monero and Zcash (using shielded transactions) are the two most popular.

Doesn't Coinbase already require users to identify themselves for KYC regulations?

Absolutely yes

Yes

Reply on news.ycombinator.com