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Comment by CalRobert | Hacker News Reader

I thought the whole point of a decentralised ledger was not needing companies like PayPal…

This point is conveniently missing. There's simply more money to be made! Now get out of here with your nonsense ideas of decentralizing money. It's bad for business.

Exactly why the crypto ideal failed.

The point of cash is that it represents transferrable value that doesn't require an intermediary between you and the person you're transacting with. And yet, banks and credit card companies exist and deal with cash. This does not mean that cash is a useless concept.

Okay and the key difference between crypto and cash/credit/whatever is supposedly that it is decentralized. Or have we abandoned that false premise now?

Cash has centralized distribution, but it's very decentralized in use. That's what makes it useful. However, sometimes people might choose to use a centralized service provider (like a bank, or a credit card company) because it's useful. They still have the option of using cash. What's important isn't that every single transaction happens in a fully-decentralized way: it's that decentralized transactions remain an option. That means that banks and credit card companies have to compete with cash, and that they can never have full control of your financial life.

The same is true of cryptocurrency. It's not a problem that centralized service providers exist. If they stop providing useful services, people can just take their cryptocurrency and go home.

Why is a centralized service provider for crypto useful? It doesn't solve any of the problems that banks and credit card companies solve for cash. Those problems are already solved in the decentralized use case.

That credit cards exist didn't mean cash stopped existing. Likewise, just because CEXes and L2s exist doesn't mean L1 cryptocurrency doesn't exist. You can still grab a non-custodial wallet and still manage your own crypto. Today Coinbase has a debit card that can sell crypto at FMV, apply their spread (1.88% I think?), and immediately use that to pay off USD denominated bills. So if your crypto is in your wallet you can just send your Coinbase wallet the funds for the purchase and then swipe your debit card to pay.

Coinbase's spread isn't the worst thing to pay for the service of having a debit card and auto-selling, but if you also buy crypto using Coinbase, they double-dip on the fee.

That is the point! You don't need companies like Paypal... Companies often offer services that are "not needed" because people like convenience, ease of use, etc.

You don't need Paypal to use Bitcoin, but there's nothing in the spec that prohibits it.

I think their point is that in the end, most people want convenience. That convenience requires centralization, which eliminates a lot of the supposed benefits that something like cryptocurrencies were promoted with. We've already seen it play out very poorly several times in crypto already.

This adds convenience because I can instantly send ETH from Robinhood to PayPal to Coinbase to my Ledger, without dealing with banking rails or creating a taxable event.

I don't think convenience requires centralization. Centralization makes some things easier and other things impossible, and things in both of those categories can be useful for convenience. BitTorrent, the WWW, and VisiCalc on the Apple ][ are three examples of distributed or decentralized systems that were much more convenient to use than their centralized predecessors.

The power of not needing companies like PayPal does not preclude them from offering services that ease its use.

The benefit comes from having the option to go elsewhere. A business that cannot lock you in is more likely to try to retain your custom by offering a good service.

I thought the point was more that you can't be required to use companies like PayPal in order to use the underlying technology.

PayPal has been slowly circling the drain for years, grasping at highly questionable Hail Mary's like crypto coins.

They earned $1.2 billion last quarter. That drain must be in a very nice part of town.

It's the same drain that Meta's been circling, the one that exists in HN commenters' minds.

The Internet is decentralized but most of us use ISPs to connect to it. Most of can't access the Internet without these companies.

In practice, the word "decentralized" just speaks to whether anyone can join in the protocol if they want. But it doesn't mean the protocol is easy to implement.

Or Coinbase, or Cash App, or Venmo, or any of the other random places you can buy cryptocurrency. If it's not on the blockchain, it's not cryptocurrency; it's just an IOU until you withdraw to a private wallet.

Which can still be useful. Just like banks used to issue "IOUs" in exchange for depositing your gold coins, so that it was easier and safer to transfer small amounts.

It's not that simple, there's a niuance there - tradeoffs are to to be made if we want to have a decentralized system; it will not scale to the whole planet, if running a node is accessible; and it must be so, otherwise it's not decentralized.

The reality is, we will have a mix of custodian - through third-party - and self-sovereign usage; depending on the context and user's skill

There is a beautiful quote about this that captures an essential process within our economic system.

> Under capitalism necessities become luxuries, while luxuries become false necessities. Umair Haque

better call up the Bitcoin CEO and Vitalik to voice your complaints that a third party you don't have to use at all is using your favorite network

It’s a grift, that’s why. Pedophile protector administration has silently dropped all of the regulatory lawsuits related to digital currency. There is minimal or no oversight right now. The pedophile in chief and family himself have also rug pulled their own tokens and not many people are caring.

I used to work at a few big banks, and because of the "friendly" nature of digital currencies. The traditional banking entities are trying to get in on the grift while they can.

Yeah, but Bitcoins ledger is shit.

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