The main point of crypto these days appears to be to replace the current middlemen with different middlemen who can make more profit while offering the consumer much less legal protection.
It's a bit concerning.
It's a bit concerning.
It's the opposite of the crypto dream. But that's not Stripe's fault; it's Bitcoin's, for not creating a product which is actually capable of living up to its goals, and instead requiring all this 'glue business' to make it work. I hope someone else creates a new radically-different cryptocurrency which can be truly new, and not just a novelty stuck on top of Visa/Mastercard.
Many of the crypto businesses in the ecosystem talk about removing financial friction and control, but it seems they are only interested in introducing their own versions of them, and building their own little Wall Street while they can still get in on the ground floor.
Here's a great example: how are you going to "reach the unbanked" in the third world if you have transaction fees, paid by the user, inherent in your architecture? That's just nonsense. It's a step down from cash in every way. Cryptos which aren't feeless but talk about the "unbanked" are full of hot air. And this pattern of false promises is all over this space.
a feeless public ledger seems unlikely to ever work at scale; it would immediately be polluted by spam.
I should correct to say a decentralized public ledger “free of transaction costs” is hard if not impossible. Nano seems to remove fees by having users engage in PoW (ie: cost of energy expenditure), so it is feeless but not free.
it sounds like you have only attempted to acquire it by a combination of
1) Purchasing it
2) with a credit or debit card
All it comes down to is that its a $2 trillion market with an extremely high volume of transactions, at all and when compared to the capitalization of the market
so service providers cater to that, and fortunately for the end users, a very large portion of that $2 trillion did not require people to pay once to convert their existing cash into crypto.
A $2T market cap doesn't mean a whole lot. It's unclear how much money actually changes hands in this system. You and I could make a $2T market cap system today, right now. I'll start an excel spreadsheet and sell you a cell for ~$40. BAM! $2T market cap excel spreadsheet, even though only $40 has changed hands! Neat, eh?
I've argued with crypto enthusiasts long enough to anticipate the requisite "WHAT ABOUT STOCKS" retort. Yes. Stock market caps are also a sloppy measure, though significantly less so in magnitude. Businesses are regularly purchased outright at their market caps. There are, of course, exceptions, like Gamestop, Tesla, AMC, and many other meme stocks. But these are the exception to the rule.
Strawman arguments are interesting, because usually it involves creating an argument nobody had offered just to discredit that argument, hoping to discredit the thing people actually were talking about. But in your case, your argument isn't a problem? The crypto ecosystem doesn't need to host stablecoins, it just does because people launched them and others found utility in that. They contribute to the market capitalization, and the liquidity, bolstering my observation. Is there a term for that? Reverse strawman?
1. Market capitalization is fairly meaningless, especially when you don't know how much money is changing hands (wash trading, for example, is rampant in the crypto world). I'm confused why you're citing market caps, again, to try to suggest stable coins don't play a significant role in crypto's liquidity. That doesn't make any sense.
2. Liquidity is very much lacking in the crypto world. Bitcoin's order books are extremely thin, which is one reason volatility is so high. Stable coins were developed not in a vacuum, but precisely because liquidity was so lacking.
I agree with that. Marketcap + Volume can still be compared to other assets. Determining how much is wash trading versus something else is unfalsifiable in crypto, the nature of transactions cannot be determined with only a limited analysis available on centralized and decentralized exchanges. But not the unlit markets, or the nature of transactional demand.
Compared to currencies, crypto assets function similarly with M0 and M1 being the tiny liquid cash thats actually moving and M2 and M3 being the illiquid much larger aspect of the currency. It requires a completely new standard to criticize crypto assets based on the exact same observation.
Compared to securities and commodities, crypto's much lower marketcap and high volume (see my first paragraph for why I don't mind the volume) is a great proportion. So, in your two-fold point, there still must be some standard for relative comparison, what would your alternative be? I choose market capitalization, understanding that a significant portion of it is relevant to value transferred from other financial ecosystems directly for exchange of the crypto asset, supporting its valuation much better than a low float asset we make in a spreadsheet.
> Liquidity is very much lacking in the crypto world
Its pretty decent. The unlit markets are bigger than the lit ones. Any OTC desk can corroborate that. Someone trying to swap in and out can use both the lit markets and the darkpools. For the size of the market, crypto's liquidity again relatively great. Of course, I see how paradoxical it is to mention "size" of the market, again, but you're not leaving me with much in the English language to work with for relative comparison. Although its totally fine for me. The market works for me.
> Stable coins were developed not in a vacuum, but precisely because liquidity was so lacking.
Although I disagree with the liquidity issue, I don't ... care about this distinction? I consider stablecoins to fulfill a market need and are crypto assets, the market noticed and used them, some of the biggest ones are currently surrogates of fiat assets. Liquidity begets liquidity, so anything that attracts liquidity is a net good to me. I don't consider the crypto space to "need" them, I consider the market to have chosen the thing that fulfilled a need, and that grows/grew the market.
It's becoming a predictable story - something with potential arises, with a community of mostly true believers. The true believers make money, but they're not optimizing for profit, they're optimizing for making the ecosystem better. The grifters, optimizing only for profit, not only start to take the lion's share of the profit, but also attract more grifters. The grifters eventually outnumber the true believers, because:
1. true believers are hard to make; grifters already exist
2. grifting as a skill can be applied anywhere; true believers need relevant skills
3. lower profits and higher burnout leads to attrition among the true believers; some of them even convert to grifters
So the grifters completely dominate the market. They then siphon the market dry, offering essentially nothing in return, and then move onto the next grift, flush with the proceeds from the last one.
So we simply ~~kill the batman~~ -- er... trade resources for resources, and determine a balance between what I am asking for vs your offer?
Its amazing we need digital fn currency to algorithm this bullshit for us to maintain trust in such NOTES
Further, I know a few small businesses that have had large sums of money locked up by services like paypal without any communication. Crypto also provides far more protection from issues like that.
> Stripe currently does not support users located in Russia, Ukraine and Belarus. While users with direct or indirect activities involving Russia, Belarus, and Ukraine are not broadly considered prohibited by Stripe at this time, all major credit card networks have announced that they are ceasing services to Russian financial institutions. Additionally, Stripe will not process transactions involving sanctioned Russian financial institutions and does not support Mir. This means transactions involving Russian-issued cards are likely to be unsuccessful. We encourage you to ensure compliance with relevant sanctions regulations in your jurisdiction.
https://support.stripe.com/questions/impact-of-sanctions-on-...
[1] https://bam.kalzumeus.com/archive/moving-money-international...
This is pretty common (simply by the size of the investments), and Yuri Milner's DST Global was in some funding rounds so they probably have a big stake.
Yuri Milner is exhibit A of how the offshore feeders fund a bunch of US tech startups, mostly for the alpha, but that also comes with influence
https://www.theatlantic.com/international/archive/2017/11/yu...
So, sanctions result in cutting off Russia, investors result in cutting off Ukraine ha.
Nothing else has this capability to the same extent.
Today we store most of our wealth in assets (market index funds, stocks, real estate, etc.) and some (typically very little, and rarely outside of a bank account) in cash.
Most of this is not actually controlled by you.
With BTC (and cryptocurrency more generally) you have the capability of having your private key in a hardware wallet under your control and retain the capability to transact independently of other institutions.
If you keep some percentage of your wealth here you retain certain advantages that you can't get elsewhere. The closest alternative would be having cash (in cash form), but it's hard to have that much, hard to travel with it (you can memorize your wallet seed words and recreate your wallet on the other side of a border), and cash is vulnerable to government stupidity (see: Russia).
I'm not sympathetic to the Canadian truck protests, but whether or not you care about what they're protesting - it's the capability wielded by the Canadian government over their private finances that's alarming.
All this is to say the focus on middleman and paying with crypto in the general case is kind of missing the forest for the trees.
The capability of a global self-custody capable store of value that can be trivially moved anywhere is a big deal and puts power back in the hands of individuals.
... How is nabbing a gold ingot and different than nabbing a storage device? If anything, the threat surface of a digital wallet is much greater (you could steal it remotely if the user doesn't have good cybersecurity practices, unlike a gold ingot).
You can trivially prove your gold ingot exists because you can just find it. It's also way harder to move your gold ingot out of your war-torn country, harder to transact with it, etc. The storage device does not hold the actual coins, just a private key that lets you update the public ledger that determines ownership (thinking the storage device holds the coins is a common misunderstanding).
I'm an open-minded skeptic, but there are real technology advantages to blockchain and cryptocurrency, there are a lot of scams too for sure - but that's not the interesting part. The HN median opinion on this is wrong as it often is (it was wrong about EVs and Tesla too).
The device itself doesn't really matter if you know these 12 words.
The key is what lets you update ownership information on the public block chain. The wallet doesn't hold any coins on the device, just a key that let's you update the chain of public ownership.
For example:
- You live in Russia and see the writing on the wall for invasion and currency collapse
- Prior to the invasion you move 90% of your wealth into a BTC wallet.
- The invasion happens and the currency collapses.
- You want to escape the country, but the border exits are guarded by corrupt guards that will steal any money/valuables you try to cross with.
- You memorize the 12 seed words of your wallet and cross the border with nothing.
- On the other side you recreate your wallet and restore access to your wealth in a safe country.
This isn't just a hypothetical, this kind of thing has already happened: https://news.ycombinator.com/item?id=29518181
That's why I said before the invasion, if the market already crashed probably too late to matter, but you'd still want to get whatever you have out.
> "And finally, movements of capital across borders are highly regulated. You can't simply cross the border and "recreate" your wealth on the other side, because all you will have re-created is a pile of dirty money that now will have to be laundered at a great expense. All this is illegal, by the way."
We're talking about escaping an autocratic authoritarian government. With BTC you can simply cross the border and recreate your wealth in a way that protects you from that government accessing it - that's my point.
I don't think you're arguing in good faith so this is the last reply from me.
Would it be very different if that asset was Euros? Or ownership of gold that's stored in Chile?
If you need any documents you can store them in a secret passworded account.
Crypto is the only option where you have the (practical) capability of true custodial ownership (as opposed to trusting a third party to hold it for you). Practical meaning you can actually take it with you in a low risk way (you're probably not escaping your hostile government with gold bars if you're even able to buy them in the first place).
For cash, the advantage is that crypto is independent of government action and global. The crash of the Russian currency is an example of why this is important. Crypto is obviously more volatile than USD, so there's a tradeoff depending on the government backed currency's stability.
It's also harder to move similar amounts of wealth in cash or commodities (you could have self custody of a wallet with a billion dollars in it, can't really move a billion dollars in cash or gold).
These advantages are real and people are relying on them: https://news.ycombinator.com/item?id=29518181
Some of this will be improved by tooling, some of it is just what's required for self-custody.
Still, the capability it provides is new and gives individuals more power even with these tradeoffs. That capability is valuable and shouldn't be dismissed imo. It's a lever against authoritarian control and increasing centralization of power.
Maybe you can ask people who get their funds randomly blocked and restricted by PayPal and seized for months/years while an "investigation" takes place if there's any use-case for crypto.
Maybe you can ask ordinary Russian citizens what their legal protections are worth once they've been un-personed by the world.
Or perhaps you can ask Canadian mandate protesters what their legal protections in their currency are worth at their bank middlemen.
Or the people who will inevitably be fleeced when the main settlement token is an outright fraud which implodes?
Their own government will "un-person" them for converting Rubles into crypto too.