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I've been hearing the Western Union usurper argument since 2010. I doubt any of the people making those arguments actually use those services.

There's an ease of use aspect to it that crypto boosters simply cannot understand, because they are used to dealing with a dizzying array of exchanges, cold wallets and nonsensical alphanumeric strings, and think that this is the UX that regular people will accept.

I absolutely agree it’s not ready for regular people to use.

> I've been hearing the Western Union usurper argument since 2010. I doubt any of the people making those arguments actually use those services.

I know you weren’t talking about me but I’ve actually used western Union, and while it wasn’t bad, it wasn’t a particularly pleasant nor pain free experience either. Wise is EXCELLENT though.

More importantly, money exchangers and check caching places extract a TREMENDOUS toll on people who are forced to use them, and the prospect that could change is actually pretty good.

Up until now the main issue was the wastefulness and lack of scale/purpose fit of blockchain. It seems like ETH is poised to solve those things where BTC was stuck due to the interests of miners.

There are problems, but it really does feel like blockchain might have just finished it’s infancy (the scam era, let’s say).

Maybe I should publish something longer form on this. I had something written then chose to self censor

I would suggest you do write something up, because there is a lot of myopia among the pro-crypto crowd about the real-world challenges of cross-border fund transfers. There is often an enormous difference in the tech-savviness of people that send the money, relative to those who collect that money. Crypto assumes similar levels of knowledge between both parties, which is how you end up with people sending ETH to a BTC address, causing it to fall out of the money circulation entirely.

I too have worked in the money services business, so I know the good and bad about these companies. They are by no means angels, but they work within the regulatory systems of the countries in which they operate and that creates costs and bureaucracy. But it also prevents problems that most of the crypto sector likely doesn't see, due to lack of real world logistical experience.

> I would suggest you do write something up, because there is a lot of myopia among the pro-crypto crowd about the real-world challenges of cross-border fund transfers.

Will do! I am confident I have the same misgivings but the base assumption here is that cross border fund transfers are hard, but crypto gives the system a chance to be rebuilt (with technology that's much more traceable, as well) -- without governments funding development and doing the political wrangling and horse trading to get on one system.

I'll try to lay this simpler thought out even simpler (for my own sake) -- If nation X and nation Y trust Coinbase, and have negotiated how to off ramp, and Coinbase satisfies KYC with both countries/participating institutions, we can theoretically do away with SWIFT + TARGET2 or VISA at the end of the day. What Coinbase as done is also not so unassailable (where as VISA very much is), so there will be many Coinbases, and this will drive prices down.

> There is often an enormous difference in the tech-savviness of people that send the money, relative to those who collect that money. Crypto assumes similar levels of knowledge between both parties, which is how you end up with people sending ETH to a BTC address, causing it to fall out of the money circulation entirely.

I agree -- I think this assumption of Crypto is optimistic and wrong. But, I also see this as opportunity -- this is a problem to be solved. Crypto needs people willing to do the hard work of building reliable, trustable, and reversible transactions, and essentially re-imagining what transactions, contract enforcement, and escrow look like without the threat of violence from one government in particular.

Maybe people shouldn't manage their own crypto wallets at all -- maybe they should be managed custodially -- that's an industry that needs to spring up. I know this is peak crypto-bull-speak but I assure you I am not a crypto bull (I literally do not hold any) -- but I can really imagine the recreation of the modern bank. An entity you trust to manage your crypto and help you make purchases/safeguard your money that takes drastically less fees than the modern bank. I could Trust and reputation becoming paramount, moreso because there is less recourse.

> An entity you trust to manage your crypto and help you make purchases/safeguard your money that takes drastically less fees than the modern bank

I am interested to read your article as I am open to changing my mind, but I know for a fact that this quoted bit will not happen to any meaningful degree.

In the scenario you posit, the market has to have consolidated around a few key players. Coinbase wins over Visa for instance. What incentive does CB then have to charge lower prices to merchants? Why shouldn't they help themselves to the same margins that Visa were enjoying?

> I am interested to read your article as I am open to changing my mind, but I know for a fact that this quoted bit will not happen to any meaningful degree.

Well I am also open to changing my mind -- would you mind explaining how you know this? Is the implication here that the regulation and operational heft of banks will be sure to apply to any new challengers?

> In the scenario you posit, the market has to have consolidated around a few key players. Coinbase wins over Visa for instance. What incentive does CB then have to charge lower prices to merchants? Why shouldn't they help themselves to the same margins that Visa were enjoying?

I think that it's natural for markets to consolidate around a few key players, almost inevitable in the capitalistic system.

I'm positing that it is much easier to challenge Coinbase than it is to challenge any existing banking infrastructure in the US, so you get a much better chance of actual competition and prices being pushed down.

The pool of people who can start a crypto exchange and the group of people who can open up a bank in the US are of wildly different size.

> it really does feel like blockchain might have just finished it’s infancy (the scam era, let’s say).

I don't buy it? Structurally, nothing has really stopped the social engineering and manipulation of cryptocurrency. The same principles that made cryptocurrency attractive for scamming still hold true, and the audience of potential legitimate users shrinks with each passing day.

I hate echoing the comment above, but I've been hearing this argument since 2012. Cryptocurrency will not graduate from it's scam phase unless it has a centralized judicial body to punish and correct wrongdoings. If that ever happens, cryptocurrency will have no tangible benefits when compared to centralized alternatives.

> I don't buy it? Structurally, nothing has really stopped the social engineering and manipulation of cryptocurrency. The same principles that made cryptocurrency attractive for scamming still hold true, and the audience of potential legitimate users shrinks with each passing day.

Two things (excuse my curtness I think they are good points that can stand alone):

- social engineering and manipulation is present in all forms of money, investments, etc -- it's human nature. Crypto essentially democratized it much like MLMs do. So I wouldn't call this a failing of crypto necessarily, but crypto did amplify the effect greatly.

- I think "the audience of potential legitimate users shrinking every day passing day" will choke out scamming narrative along with the legitimate use narrative. Once this post-fire brush is cleared, new things (useful things with actual utility) may have a chance to grow.

> I hate echoing the comment above, but I've been hearing this argument since 2012. Cryptocurrency will not graduate from it's scam phase unless it has a centralized judicial body to punish and correct wrongdoings. If that ever happens, cryptocurrency will have no tangible benefits when compared to centralized alternatives.

It's a good argument (and it's not wrong either).

As far as the judicial bodies, I do think that they can be distributed/federated though, and that small networks can grow with trust as currency, anew. Right now the established systems have found one way to encode trust via contracts and implied/actual force, etc. I think that crypto might be able to offer a new way to enforce trust for less serious/lighter use cases.

I think of it this way -- do I need the full faith and credit of the united states government to buy a coffee? Maybe not. Also in making that statement I am fully aware that being money is one of the biggest failings of crypto so far, but I think PoS ETH2 + L2 + Sharding/rollups (future) will actually make it possible (in theory at least) to surpass VISA's transaction volume as a network.

Also, I think there's a huge way crypto might be better than the traditional alternatives -- it represents a chance to redraw the boundaries.

The current system is ossified -- even if crypto is simply a re-creation of the existing system with worse efficiency maybe it's similar to trying to change the engine in a moving plane/train/automobile. You build a second, possibly shittier engine which can be less tied to the mistakes of the first, switch to that, then maybe switch BACK to the original engine after upgrading/changing it.

Optimistic, but I think the current success of PoS ETH2 (and the fact literally anyone else can take it and run their own) warrants some optimism.

I have used Bitcoin sporadically in that very niche. I'm probably an exception, and I'm in the nerd crowd already, obviously. Some of my friends and family have indeed played around a bit with cryptocurrency, enough to be comfortable receiving some Bitcoin. Bitcoin is the easiest way to send money to some of them, practically speaking.

I'm in Canada. They're in the United States. They don't have PayPal. Bitcoin is actually one of the few options available. Sending just $40 of funds internationally, when either or both parties don't have a US dollar account, or even a bank account, and definitely no PayPal account, is potentially quite difficult. Money transfer? Except Western Union is also difficult to work with sometimes. Last time I called for identity verification, they seemed not to comprehend I was not in the United States, and I couldn't get it sent. Fees are brutal, too, at easily 20% for a small amount. So, potentially difficult enough, that even the headache of cryptocurrency starts to look attractive.

Out of interest, why is PayPal not an option for a US-based person, but BTC is?

In the most recent case, he could turn BTC into cash at a machine at his local convenience store. Surprisingly convenient, really.

He doesn't have a bank account as he's on the blacklist. Not sure why. But in the United States, if you write too many bad cheques, commit cheque fraud, or just default on your overdraft, basically anything where the bank closes your account with cause, you may find getting a bank account again, from any other bank, very difficult. (They have a reporting service they almost all report to and verify with.)

About 10 million Americans are blacklisted like this, from what I understand. And then you have people who lack ID, or who can't get an account for another reason. The unbanked add up to a fairly significant market - something like 5 - 8% of American adults.

Once the fundamental underpinnings are well-established, expect a UX renaissance. Everyone knows the current UX is dogshit.

Either way, the table-stakes for digital and financial literacy in the modern world are rapidly changing, and we should be prepared for some increased level of baseline complexity in the coming decades.

And IMO this is a problem to be solved. I am generally optimistic in the human race in that if there is a problem to be solved, and money/status/etc attached -- we'll solve it, given enough time.

Imagine how complicated computers, AI etc are -- is it that we just haven't gotten the same UI/UX visionaries to apply themselves to crypto yet?

As a UX specialist who has worked in the crypto industry, we are there. We are working on it. There's just a few dozen of us compared to thousands of facebook employees who can A/B test features till the sun comes up.

> Despite never touching crypto up until now, I feel it finally has a solid use case.

I'd reword this as "I finally feel it has a solid use case", as the use case of "put western Union out of business for international same party money transfers" has been present since day one.

You're just now understanding that it takes time for complex software systems to mature and reach their goals. Next time a novel system appears, this reframing of your mentality might help you to see the benefits earlier on and become an early adopter.

> I'd reword this as "I finally feel it has a solid use case", as the use case of "put western Union out of business for international same party money transfers" has been present since day one.

This is true, that was badly worded. Maybe something like "the few use cases that make sense to me have finally become guilt-free".

> You're just now understanding that it takes time for complex software systems to mature and reach their goals. Next time a novel system appears, this reframing of your mentality might help you to see the benefits earlier on and become an early adopter.

But I still don't necessarily want to be an early adopter in every piece of technology. I'm perfectly content to let people find the sharp edges and report back -- and either way up until now it was an absolute no for me with the environmental impact (knowing that PoS was possible) and rampant low-grade scams.

> the few use cases that make sense to me have finally become guilt-free

Again, it takes time for novel, complex systems to reach their goals. Proof of work was a rudimentary attempt at security a network, and if you read the Bitcoin whitepaper, it was never suggested as the best solution. This wording still applies undue negativity to crypto fundamentals.

It's totally fine to not jump on every new technology, but equally fine not to be a hater towards new technology which is still being developed. :)

> international same party (sending money to yourself) money transfers

But you've not sent money to yourself, you've sent Eth to yourself, and you still need a forex transaction on each end?

> Does this mean that we have a substrate for person to person hawala systems (which are normally outlawed by the government?)

I've thought of crypto as "hawala banking for geeks" for a while now, but if it's banned by the government then inserting extra steps does not fix that and if you become big enough they will come after you for money laundering.

Why do you want to trade shares via a blockchain rather than a perfectly normal broker?

> But you've not sent money to yourself, you've sent Eth to yourself, and you still need a forex transaction on each end?

True -- it cuts down on middle men though!

Also, there's the very very theoretical case of buying things in ETH/USDC/whatever else. While buying things in BTC and ETH may be a pipedream (I don't think so in the ETH case but I won't try to defend it), stable coins are quite alluring as essentially proto-FEDCoin.

There is no reason every nation won't have a coin, and they'll be traded that way. There are a lot of negative effects to more heavily digitizing the money system, but that's another discussion -- crypto is just serving as an emotionless, politics-free money transferer (of course, it is enveloped in politics still), with a different fee structure (vs. Western Union, for example).

I said this elsewhere but basically it gives us a chance to rebuild the money system. Even if what we build is bad it's not like we're being forced into it -- but if it's even a little better, the value is infinite (given infinite time).

> I've thought of crypto as "hawala banking for geeks" for a while now, but if it's banned by the government then inserting extra steps does not fix that and if you become big enough they will come after you for money laundering. > > Why do you want to trade shares via a blockchain rather than a perfectly normal broker?

I'm not sure the government will ever actually ban it at this point. Especially with the relatively "blessed" nature of USDC and size Coinbase has grown to (and it's market leader position). I think at this point bitcoin exists as a political tool and prepping mechanism for the complete digitization of currency. FedNOW is the first step in that direction, maybe we'll get FEDCoin later.

Brokers charge fees, and are protected by capital requirements and regulation (which also protects consumers of course!). I think a rebuild of the system gives us a chance to meaningfully improve on the system of legislation and regulation we have so far -- the second build of finance, let's say.

For example, it's unnecessarily hard to set up an ETF -- I think the middlemen, gatekeepers, and fees there could be reduced to near zero there.

> True -- it cuts down on middle men though!

It adds two middle-manned transactions instead of one?

This seems to be the same wishful thinking that's come out of the crypto space for about 10 years now. There's no reason to think now is any different.

Depends on the token used.

ETH - middleman is all stakers and nodes securing the network, in which you can also participate.

USDC - same, but with a centralized company who will blacklist your funds if you are on a US sanction list. Already very different degree of permissioned entrance to finances than a bank or money exchanger.

DAI - same as ETH but also depends on a permissionless and much wider pool of users across the world governing the protocol, which you can also opt into.

> ETH - middleman is all stakers and nodes securing the network, in which you can also participate.

That's three sets of middlemen then, because you need to both get into and out of ethereum as well.

Technically more if you count ISP, computer provider, and the bank handling your fiat to actually get in and out of the exchange.

But the idea is, once in the system, there are less intermediaries*. So if you send ETH or USDC, the receiver can spend that token for certain services or investments instead of converting back to fiat.

* specifically, intermediaries that control your funds or could censor your transactions.

That's not the idea I was responding to, which was the usual "it's great for international transfers" stuff, which as always completely ignores the two extra transactions introduced.

Also, was there not a report just a few days ago about the new PoS eth validators that are complying with US sanctions, making up a majority of the new blocks? This seems to go against the whole "reducing intermediaries who could censor transactions thing".

Either way, none of these arguments are new, and AFAICT, cryptocurrency hasn't made a huge dent in the transfers market in the last ten years of people saying it will.

But it does work for international transfers, if you also assume that the sender and receiver are spending the token for services, or if either party is not in a rush to exchange from or to fiat. An example would be a US citizen pulling crypto profits and sending remittances in tokens to their Latin American relatives, who wish to have some alternative liquid value not controlled by their banks or government in the case of financial collapse.

Crypto is probably not going to replace interbank USD-to-USD transfers but this is not something it needs to replace.

Usage is definitely increasing[1], but it won’t replace the extractive remittance industry overnight. The technology and UX still has a long way to go to be useful to non-nerds and the general public. Only this month did Ethereum even become a carbon neutral value transfer mechanism, which paves the way for future improvements.

And yes, if the majority of stakers commit to OFAC censorship, they can block your transaction to a sanctioned address. This is not great, and something the core devs will probably seek to circumvent in future, but it is not the same as a bank, payment processor or credit card company blocking your account on a whim.

[1] https://blog.chainalysis.com/reports/2021-global-crypto-adop...

> But it does work for international transfers, if you also assume that the sender and receiver are spending the token for services

We're explicitly not assuming that. We are explicitly not assuming that, how many times must it be said?

From up-thread "you've sent Eth to yourself, and you still need a forex transaction on each end", to which someone replies "True -- it cuts down on middle men though!".

In that situation, you have not, in fact, cut down on the middle men.

And now three posts from you saying "But it does if you want if you want eth at both ends"

That wasn't the question. FFS.

Look again. The original statement did not explicitly assume forex. And the original comment to that statement was a question as to whether forex is needed; the answer is “no, if you don’t require fiat” - and obviously it also depends on calling Eth and stablecoins “money” which many crypto users do.

> international same party (sending money to yourself) money transfers

>> But you've not sent money to yourself, you've sent Eth to yourself, and you still need a forex transaction on each end?

Somewhere along the way the discussion changed from one party transferring to them self, to two parties.

There's also several projects attacking web3 social and identity:

1. https://ens.domains/

2. https://nftychat.xyz/ [0]

3. https://www.farcaster.xyz/

4. https://tryshowtime.xyz/

[0] I'm the co-founder