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Reading it would’ve saved you the embarrassment of making a comment that effectively retreads the actual article in its entirety while also painting yourself in a negatively arrogant light.
This ain’t Reddit. RTA is advised before commenting.
It's probably cheaper and easier to get your own country and then make your own regulations to avoid that stuff. That's how terrible it is.
My anecdotal experience from EU is that no-one even knows chargebacks exists or how it works and if this was turned into a transparent honest insurance, prompted via a question on the payment terminal/online checkout such as "Do you want to pay 1-3% to insure this purchase?" the vast majority of people would click no on the vast majority of purchases because there is already inherent trust involved between the merchant and the shopper.
Now add the chargeback pains that merchants go through for credit card frauds and you have what appears to be a sickly system where both shoppers and merchants lose, with the only winners being visa/mastercard & the acquiring and issuing banks they cooperate with.
If I buy a burger from a restaurant and its bad, i tell all my friends and i don't go back. I don't need insurance.
If I buy a service on steam, i already trust valve fully for those smaller amount sizes, I don't need insurance.
My gut feeling is that >99,9% of purchases made via payment cards are not relevant to insure meaning following the simpler risk model of cash for those would work just fine.
The point is it’s punititive to the merchant. You’re incentivised to avoid them pretty much at all cost
and for large transactions, most wont use a credit card (like buying a house)
On the other hand, credit cards are something else. Those are essentially short-term loans that are insured. As there are many parties involved that profit from you use of these, there indeed is a lot of protection in this case. But credit cards are very niche part of online card payments and mostly it is a USA thing.
Nailed it. Anyone can move money.
As a consumer, I always opt to pay for credit card where available. The safeties provided to me facilitated by everyone in the network – from issuer to acquirer and everyone in between – is exactly why. I don't want to consider waiting 12 months in line at small claims to get back $200 sent over Interac for services that were never provided by a shoddy business owner.
The cost of those consumer safeties and convenience is incurred by the merchant. This is the cost of business.
That cost is a minimum of 100% passed on to the consumer.
This "insurance" could be offloaded to a neutral third party that isn't controlled by the credit cards. Often, you purchase additional protection insurance on your big ticket items. This could easily be extended to cover whatever credit cards would have been relied upon in the past.
I had not considered this. My first thought is how technically and operationally complex it would be for an insurer to underwrite these transactions "on-the-fly" from merchants they don't know, but it is probably a great idea.
That's because they compete with credit card companies today. Make them more popular and I bet their costs would come down.
Even a PSP requires some "minium/fixed setup" on different layers in the org, so building this with two people over your spring break will not be possible.
Bitcoin is not the only currency. There are quite a lot of decent networks who offer quick transactions with almost no fees and is not a speculative currency
In Dubai and Singapore, maybe it works well because capital gains aren't taxed.
People need and like to use credit, but they are doing it wrong by contributing to the "rotten" system. Crypto is a great store of value because you can use it as collateral to borrow against. Supply eth, borrow usdc, withdraw as usd. This is tax free since the conversion is 1:1 and there are no gains to report.
Instead of buying things with a credit card and paying it back every month, provide crypto as collateral, borrow against it and then pay it back. The difference is that this takes an upfront investment in order to get yourself started. Not too much different than the way credit works in SE Asia, since they time lock a deposit, to enable a debt card.
Maintaining your collateralization ratio (this answers the price volatility question) is no harder to do than paying the exorbitant fees to credit card companies for your balance. This could easily be wrapped into a nice UX. It would work globally and enable all sorts of great commerce. No more giving up all your information to the credit card companies. No more credit scores to get hacked either.
Your scheme is just debit cards with more work, less privacy and a lot more risk.
Consumers use credit cards because of chargebacks and fraud protection. If I get my card stolen or I accidentally pay a fraudster, I get that money back.
Crypto's irreversibility is one of the worst things about it from a consumer perspective. It's also horrible for privacy since all your transactions are literally public.
> Consumers use credit cards because of chargebacks and fraud protection.
True! However it isn't your credit card that protects you with purchases from Amazon, it is Amazon.
I use my credit card for all sorts of things, because it is just convenient. Do you expect to do a chargeback at a grocery store or gas station? No. But, what you're giving up for that privilege, is all of your data.
> Crypto's irreversibility
In what I'm talking about, this part is irrelevant since you're just paying with cash.
> all your transactions are literally public.
You actually believe that credit card transactions are private? LOL. They are sold to the highest bidder.
And no, credit cards protect you from the merchant. I can call up Capitol One and get them to do a chargeback if I order something online and the merchant never sends it.
It highly incentivizes the merchant to help you, otherwise the only recourse would be to take Amazon to small claims court.
> You actually believe that credit card transactions are private? LOL. They are sold to the highest bidder.
You misread it. Your crypto purchases are public. Literally. Yes, your card purchases are compiled and sold in aggregate, but the entire blockchain is available to anyone.
It's an utter myth that crypto is private or can't be tracked lol
This is really no different except that instead of borrowing from a third party, you're borrowing from yourself. In the same way that you don't pay taxes when you borrow from a bank or when you borrow from your friend. Cut out the middleman and be your own bank.
My prediction is that one day, people will think of crypto as the traditional finance system. We're already seeing the transition happening today.