Ferrari to accept crypto as payment for its cars in the US | Hacker News Reader

Ferrari to accept crypto as payment for its cars in the US

reuters.com

65 pointsiancmceachern60 comments

But they don't price their cars in crypto, of course.

> "Prices will not change, no fees, no surcharges if you pay through cryptocurrencies," Galliera said.

> Bitpay will immediately turn cryptocurrency payments into traditional currency on behalf of Ferrari's dealers, so they are protected from price swings.

Isn't that the same as just turning it into a Bitcoin exchange and giving the cash to Ferrari?

I'd say a move like this would be more of a Lamborghini thing, but hey!

Lamborghini doesn't need to make any effort to lure in cryptobros so why bother?

Yes

It’s similar to how when I travel overseas, I have local currency in my account & that gets converted to local currency through an intermediary as I pay.

The intermediary usually charges a small fee. I only see local currency exit my account, and the seller only sees their local currency enter theirs.

except not at all because you wouldn't have to bring all the cash in 10 briefcases.

If the traditional banking system must be avoided, this is true.

When crypto is involved, I think of shady folks.

If you use a crypto exchange to acquire cash and then purchase a Ferrari in cash, you probably will trigger IRS regulations that require the dealer to report a large cash transaction (>$10k)[0]. I cannot find clear documentation from the IRS that states cryptocurrency transactions trigger mandatory reporting, though it is possible that it is reported somewhere.

From my very biased perspective, Ferrari accepting crypto is just advertising to various "bad folks" (drug/gun/human traffickers) that they're not gonna tell the IRS.

[0] https://www.irs.gov/newsroom/cash-payment-report-helps-gover...

In Italy they use Euros. In America we use USD.

What is the flow of fiat -> BTC? Aren't there multiple?

Isn't it like $1.00 USD can be 1.00 Tether (of which there are 7+ stablecoin alternatives https://www.makeuseof.com/stablecoin-alternatives-to-tether-...) and then 1.00 BTC to Tether basically fluctuates like crazy?

Thinking outloud here: How are you protected from a price swing? Because the car has a value in fiat I guess... and the stablecoin layer in between (because I don't think you can go straight from USD or EUR into BTC... can you?) is irrelevant. OK, makes sense.

It's a smart move since a large chunk of their target audience has all the reasons in the World to only trade either in cash or crypto.

I assume that if you pay for your car with bitcoin that has appreciated in value that you still owe capital gains tax as if you had sold it? If so what’s the advantage of paying using bitcoin?

Using Bitcoin has certain advantages such as cutting off the middle man, bypassing non-transparent AML regulations and having almost instant transaction settlement without waiting for days.

Is this satire?

it must be, the article clearly states that there is a middle man that immediately converts bitcoin in USD so Ferrari's dealers never see it, and that middle man also deals with KYC and AML stuff.

I think it cutting the user facing middleman if given a bitcpin address from the users prospective it doesn't matter whether it goes to a wallet controlled by Ferrari or a payment processor working for Ferrari. No loan officer no bank paperwork no limits on cash withdrawal and kyc bs. Just take money out of bitcoin wallet point at address. Would I do it no. Bitcoin is speculators game not a longterm store of value but if i was an early bitcoin miner I could see the value proposition and how it might look like you could avoid the irs taking a cut

cheaper, faster, secured lending that doesn't affect a credit score. a few minutes versus 7 - 90 business days on the consumer lending side

no arbitrary transaction limit thresholds to worry about for your large purchase

this infrastructure is inherited by all crypto currencies, or they can be easily converted to one that does

the article is about crypto not only bitcoin

but to your scenario, not everyone has a gain to worry about. if you acquired bitcoin right now to pay for something with it, there is also no gain to worry about. youd do that because thats where your liquidity is: already in other cryptos and you just bought bitcoin to pay. and of the people that only have big capital gains, not all of them care either if they wanted to purchase something, they might have to report a gain too. just saves one step of converting to USD first. they might have capital losses elsewhere they neutralize the gain.

but I think you’re missing that USDC is a big component here, they accept USDC, which does not have price fluctuations

so lets go to your discouraged speculator scenario: they can just deposit their bitcoin in a lending protocol and get USDC back within a few minutes. they have no capital gains tax event. and now can pay for their car without even needing an exchange relationship.

and for everyone else, they just already have liquidity in crypto. They already have USDC and aren’t avoiding any new tax event either.

there are also many shortsighted people that simply won’t consider the tax event. nobody’s problem but their own

> “no arbitrary transaction limit thresholds to worry about for your large purchase”

This is not a problem for anyone who buys a Ferrari in cash.

Banks and credit card companies love nothing more than letting you buy expensive things once you’ve shown you have the money.

And its not a problem for crypto users that now want to buy a Ferarri either

to make that point, I think you're still missing that there are already crypto users. this isn't about convincing anyone to switch to a different system anymore. its about catering to additional routes of liquidity.

nobody cares about playing devil's advocate with nocoiners anymore. the world kept going, bitpay the payment processor is like 10 years old. but if you’re interested in why someone likes their crypto ecosystem, I’ll explain some behaviors.

I don’t mean this in a rude way, but do you have Ferrari money? Traditional financial institutions work VERY differently for the kind of people who do compared to the average person.

Look into a crypto lending/ yield pool. You'll understand what he's saying because it's nothing like "Traditional Finance". Traditional Securities-based lending does not have a "base oracle" like crypto does, and the lenders get to determine the spread. The margin limits, the rates, the transparency, all much better in a crypto yield pool.

But you obviously run the base risk of a defi exchange getting hacked, which you are not covered for like you are in traditional finance. (There is some interesting crypto insurance products tho)

liquidity is liquidity, Ferrari decided to recognize a lot of people don't care what traditional financial institutions do

not sure the point of wanting to play devil's advocate to the points made here, there are already people actively using the parallel payment systems and Ferrari is catering to that, its no longer about convincing someone comfortable in the traditional finance system to learn about crypto

the crypto ecosystem has its own ways of doing everything... at all tiers. there are no tiers of wealth or needing to revisit relationships with banks now that you have money. so they're already familiar with the quick lending if they want to use that.

some people are well integrated in a system where you don’t have to start a question with “I don't mean this in a rude way, but do you have enough money for this to be convenient”

A lot of people with Ferrari money have their net worth tied up in investments like stocks, bonds, real estate and maybe even Bitcoin. Bitcoin is a very liquid asset, buying a Ferrari with it would be nearly instant.

Because if you're sanctioned to hell you can use Bitcoin to get around them. BitPay has been the go-to for sanctions busting for years. Even with regulators making BitPay ID mandatory for transactions over $3,000 you can still easily use a straw buyer. Want a Ferrari in Russia? Export it to China via container ship, then have it travel overland via train to Moscow.

Come on. Painting crypto like some way to bypass sanctions is just laughtable when neither EU nor US have a balls to sanction enough people and enforce any of sanctions. No one of substance is on sanction lists yet and those who are don't need to bust anything. They'll just fly to Dubai and buy their Ferrari here. Or just ask one of their countless relatives living in EU or US to do it for them.

The only people with Russian passport who actually use crypto is refugees who have no access to banking system in EU or someone who want to pay for their Netflix or buy some games on Steam.

PS: Only around 1,000 people are under personal sanctions by US when have to be 7000+:

https://acf.international/list-of-war-enablers

And this list not include all their countless families living in US or EU using the money they stolen in Russia and laundered in west.

Wait but I was told the reason cryptocurrency would change the world is that it’s censorship-proof?

Cryptocurrency is too expensive and too much hassle to use when you can just come to Turkey or Dubai with $1,000,000 in a bag and put it on your bank account with no questions asked.

No need for cryptocurrency when there is HSBC.

You just coined HSBC's new marketing slogan!

> the reason cryptocurrency would change the world is that it’s censorship-proof

It is… right up to the moment that you want to convert it to fiat.

At that point, all bets are off.

(Not sure what “censorship-proof” means exactly, but I will assume that it’s something similar to sanction-proof.)

What? Crypto is an excellent vehicle to subvert sanctions. The point isn’t to protect the buyer, it’s to give the seller plausible deniability.

Is crypto is excellent for that? Might be.

Is it actually used at the moment? I doubt it.

How many people been charged for bypassing sanctions? How many companies been sued for or fined for this? 100? 200?

EU companies still helping Russia to increase their military production and keep selling parts for heavy machinery. Husband of president of Estonia owned a business transporting whatever in and out of Russia during the war and no one gave a damn.

No one care. Nothing is enforced. Sure banning some crypto will help.

If you're just going to use a straw buyer then it doesn't matter which currency is used.

>If so what’s the advantage of paying using bitcoin?

People who ask this also ask that same question "what’s the advantage of owning bitcoin".

One example that i would like to give is that you can wrap bitcoin, and put it in a lending pool. I can then borrow up to 30-40% of the bitcoin at a very reasonable APR rate. (2-3%) Now this only works if you consider bitcoin an asset. This allows you to use this bitcoin as collateral for buying a car.

People can do the same thing with stocks, real estate, etc. But with bitcoin, i have no middle man and i do not have to be "approved" or take a "Credit hit" if i make to many inquiries.

How to say Ferrari customers are sketchy without saying Ferrari customers are sketchy.

Going after that drug dealing / money laundering segment

That's really the only angle that makes sense to me here. For cars that start at $200k, who else has the available cash and cannot be bothered to use traditional payment mechanisms?

The Venn Diagrams of "Want to buy a new Ferrari" and " have a bunch of bitcoin" seem that they would only intersect in a few places.

"Crypto nouveau rich" sounds like one of the Ferrari-est target markets going tbh. There aren't very many of them, but not very many people buy Ferraris anyway.

I have 90+% of my net worth in bitcoin, it would be far easier to buy a ferrari with bitcoin for me. I don't need a car though.

I imagine there are about 4 other people like you though. Weird nieche to be targeting.

Ferrari sells around 10k cars per year, they already are in a weird niche. Maybe they understand their business better than you do.

Maybe, or maybe they’re going to sell 10,004 cars a year. Seems more like a marketing stunt than anything.

Well, clearly, that doesn't make it any less weird.

I think you would be surprised.

Can we stop the cryptocurrency hate and start trying to see something positive in it? We are not all criminals and thugs. This is becoming so tiresome.

I am the other one in that 4 group of people it seems

Nah, especially in tech, people are too invested in hating bitcoin. They'd have to admit to being wrong to change their tune, which will likely never happen.

Probably has something to do with finally coming out of the conjoined coin scams and NFT blockchain brain rot that crypto bros spent countless hours trying to manipulate financially illiterate people into being left to hold the bag on their rug pulls that were exposed on a bi-weekly basis, or something. Cute little speculative toy though :)

Yeah, when people confuse bitcoin with NFTs or believe that keeping bitcoin on centralized exchanges is normal, or that "smart contracts" are the future, I can understand that they see no value. Too bad you listened to "crypto" people, not bitcoiners, but that was your choice.

Because we are the people that can best see behind the lies about Bitcoin. It's really not useful to pay with it. It's really not going to hold value if a big country (or EU) forbids it.

Away from Bitcoin, towards web3 and crypto. What useful things have we seen? Since nearly a decade we have been told and shown claims about unique features, changing the world and so on. Nothing came out of this.

What is crypto useful for right now? Buying/selling drugs, huge speculation & sending rather big amounts of money across the world (and then converting it to fiat lol).

> It's really not going to hold value if a big country (or EU) foribids it.

Haha, how did China banning bitcoin affect anything? Is it just ignorance or racism that you ignore what China did?

> Away from Bitcoin, towards web3 and crypto

Haha, yeah, fuck off, this is not about "crypto". Away from humanity and towards genocide, what have you done to prevent it? I guess it's only fair that I connect you with any random thing I want.

> What is crypto useful for right now? Buying/selling drugs, huge speculation & sending rather big amounts of money across the world (and then converting it to fiat lol).

You don't realize how privileged you are? You have no worries about runaway inflation, you have access to a functioning banking system, your are not concerned about having your wealth stolen, you have no problems sending money anywhere you want to. You're the typical "bitcoin is not useful for me, so it's not useful for anybody because only I matter" crowd.

Always good to accuse someone of racism in the first interaction you ever have with them.

I'm sure the other 2 people of that 4 are also on HN, given enough time we can find them.

And it's not about crypto hate, more like......you have 90% of your net worth in what is basically an unsecured investment vehicle? I'm not sure whether I should be impressed or terrified.

I saw why bitcoin has value in 2013 and have been acquiring more ever since. Bitcoin is one of the reasons I sleep well at night, but you do you.

Cool, the feeling of being impressed/terrified is growing stronger.

You likely have 90% of your wealth directly tied to the success of the US. Politically unpredictable and divided, larger deficits than ever, persistent inflation, trillion dollar DOD budget while most under the age of 35 are burdened with huge education debt, unaffordable housing & healthcare, and failing infrastructure and systems.

US assets aren't becoming more valuable, the dollar is losing purchasing power. Bitcoin is a hedge that the US won't maintain it's dominance and growth trajectory of the last 30 years.

Sorry, I defended crypto vehemently for years, but against a growing mountain of evidence and no serious use-cases after exhausting countless engineering hours and VC… it kinda seems like a scam at this point.

After so many years you still don't realize how privileged you are? You have no worries about runaways inflation, you have access to a functioning banking system, your are not concerned about having your wealth stolen, you have no problems sending money anywhere you want to. Makes one wonder what you defended all those years, perhaps scammy ICOs and NFTs? Oh well, that you spoke of "crypto" and not bitcoin already made that likely.

>4 other people like you though

You'd be surprised. You obviously haven't been to a crypto conference.

Don't forget sanctioned individuals. This payment method must be looking appealing for Russian oligarchs right now.

Any company doing business with known sanctioned individuals directly would be in super hot legal shit, no matter how they choose to pay. If you say that they can just use an intermediary then they can also do the same with cash - really not seeing the point here.

It doesn’t. It’s being converted to fiat money during transaction, so all the sanctions will still apply to the payment processor.

And even if it didn’t, they’d apply to Ferrari.

As always, crypto is not actually solving problem other than adding extra complexity and making headlines.

Nah, they accept traditional money to get all of that, which is widely more popular with all criminals.

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