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Comment by djbusby | Hacker News Reader

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djbusby

It's crypto/web-wallets, not traditional wallet.

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The article only briefly mentions crypto and is instead about products like Paypal, Cashapp, Venmo, and the like.

That's my mistake; edited.

If it were, what's wrong with that?

Crypto is a Ponzi scheme.

Nope

Ethereum is a VM for example. Quite hard to see how it can be construed as a pyramid scheme tbh.

On Aug 15, 1971 this statement becomes true for US dollar - Executive Order 11615

All currencies, including crypto, fiat, and chickens, have been Ponzi schemes since the beginning of time and will continue to be until the end of time. It's fundamental to their nature.

When the state does it, it's not ponzi until the state implodes and then it is.

Currencies lack the suggestion that holding them will bring you a profit. That isn't true of chickens, which are significantly better in investment terms than currency - holding chickens definitely will bring you a profit, unless you screw it up.

You can use Ethereum without ever speculating in crypto-native assets like ETH. Transacting in USD-backed stablecoins is a major use-case of Ethereum.

Do we have any evidence? Why would anyone use a USD derivative instead of just USD?

Lower transaction fees, available to people without USD bank accounts (most of the World), and you can use smart contracts for more complex transactions than sender -> receiver.

I’m very bearish on crypto generally, but DeFi has started to catch my attention a little bit, as it does have potential to shake up finance more broadly.

I asked if we have evidence because the author made an interesting point in a recent interview on the "Bankless" podcast:

"When we hear people like Tether saying we're successfully banking the unbanked, you can look at the median transaction over the Tron network, and it's between $100 and $300. If you looked at comparable numbers in the US for credit card transactions, the median transactions is between $40 and $80. And so, do you buy that they're banking the unbanked third world who are moving a lot more money around than people in the US do?"

Actually cryptocurrency perhaps more resemble a pyramid scheme because early investors profit disproportionately from latecomers, who buy at inflated prices. Transaction fees play a key role, as miners or validators earn significant fees, often benefiting early adopters with large holdings who promote network usage. Thus, high fees primarily enrich those already invested, leaving newcomers to bear the cost.

Well, I thought it was going to be about cash-wallets. Like, cool leather ones, or a nifty money-clip option or something. Was disappointed it's about web-wallet things.

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