[HN Gopher] Crypto Winter, or Crypto Ice Age?
___________________________________________________________________
Crypto Winter, or Crypto Ice Age?
Author : AndrewDucker
Score : 47 points
Date : 2022-07-14 10:25 UTC (12 hours ago)
(HTM) web link (www.technollama.co.uk)
(TXT) w3m dump (www.technollama.co.uk)
| drdrek wrote:
| Saddest thing about Crypto even more than the energy cost is the
| human minds it consumed. I heard people saying that Crypto is
| what bright graduate students want to focus on and that just too
| bad.
|
| If you want to finance the un-financed or create decentralized
| finance go into fintech, crypto is just a bad implementation of
| fintech... If you want to change the world go into Biotech or
| Energy tech.. the next thing to change humanity is probably a
| better battery not a better foreign exchange market...
|
| And if you just want to get rich by taking money from fools I
| would recommend setting up an online casino, there are companies
| that sell white labeled platforms for online casinos and those
| extract money from poor people with 10th of the cost to the rest
| of humanity and takes way less effort to set up!
|
| First result in google, not an endorsement [1]
| https://www.softswiss.com/white-label-solution/
| anony23 wrote:
| Crypto IS a subset of fintech.
| skyyler wrote:
| Yes, the comment you're replying to said that it is a bad
| implementation of fintech.
| mountainriver wrote:
| Yeah it's not really solving many problems, more people should
| go into AI, that's where all the impact will be
| sshine wrote:
| "Too many smart people go into finance and law."
|
| said some electric car manufacturer.
| Tao3300 wrote:
| Heat death of the metaverse
| heckelson wrote:
| I imagine it to be extremely difficult to remain unbiased in a
| dissertation about a technology when you yourself are financially
| reliant on that technology.
| bannedbybros wrote:
| lucideer wrote:
| Bitcoin is absolute garbage and in theory any critique is good,
| but it bothers me that half of the points in this article aren't
| even internally logically consistent:
|
| > _"Blockchain is just like the early internet". No, it isn't.
| Satoshi Nakamoto's paper was published in October 2008 ...
| <proceeds to compare age of Bitcoin to the age of some modern
| tech corps>._
|
| Nothing about the original statement is predicated on the age of
| the tech. Even if it did, I don't see what modern tech corps have
| to do with anything - they didn't build the internet. Also, on
| age, the early internet dates back to the 60s and was still
| considered "early" 30+ years later.
|
| > _There are centralisation and technical problems with these
| solutions, but let's ignore those for now, and call these systems
| for what they are. Second layers act as a reminder that the
| original networks cannot scale, and need a second network on top
| of the network to operate. This is an admission of failure._
|
| If we ignore the technical problems, 2nd-layer seem like a
| practical solution to a problem. Why is that a failure?
|
| (now I know that they _DO_ have technical problems - so maybe let
| 's talk about those specifically, instead of making weird
| nonsensical statements)
|
| > _"Bitcoin is digital gold". It isn't, gold is gold, it requires
| no maintenance fee, once it's mined [...] Bitcoin [...] need to
| be maintained by miners using electricity [...] at least to keep
| the mining running._
|
| Why is mining excluded for gold and not for Bitcoin in your
| analogy?
|
| ---
|
| As for my own opinions...
|
| > _Concluding, will crypto die?_
|
| This is two questions:
|
| 1. Will the crypto market die? Hopefully, though I'm less than
| optimistic.
|
| 2. Will blockchain tech die? Of course not. It's not very useful
| but it has niche applications - there's plenty of obscure tech
| that's kept around by enthusiasts, so I think we can be sure that
| even after the last cryptobro is bankrupted, there'll still be a
| group of geeks somewhere hacking on the blockchain for fun.
| SideburnsOfDoom wrote:
| > Why is mining excluded for gold and not for Bitcoin in your
| analogy?
|
| because: "Bitcoin needs to be maintained by miners using
| electricity" like they say?
|
| Gold doesn't need continued mining to continue being gold.
| landemva wrote:
| Bitcoin miners consume electricity to provide fast and
| affordable assay. For small value Bitcoin transfers,
| lightning network is even cheaper and faster.
| nailer wrote:
| You need to rent a safety deposit box for the gold to
| continue being _your_ gold though.
| SideburnsOfDoom wrote:
| > You need to rent a safety deposit box for the gold
|
| No, I don't. Where I keep my valuables is my business, and
| it depends on how much gold I have. People kept gold long
| before safety deposit boxes at banks were a thing.
|
| And, paraphrasing above: why is secure storage included for
| gold and not for Bitcoin in your analogy?
| nailer wrote:
| > Where I keep my valuables is my business, and it
| depends on how much gold I have. People kept gold long
| before safety deposit boxes at banks were a thing.
|
| Sure but the other options often increase risk or have a
| different cost. Some Vietnamese friends used to keep
| money in their house and then had their homes invaded. I
| imagine that's not entirely uncommon.
|
| > And, paraphrasing above: why is secure storage included
| for gold and not for Bitcoin in your analogy?
|
| Oh that's my point - we should definitely take in storage
| costs for both.
| xnorswap wrote:
| The internet didn't really take off until the web, but once the
| web was there it completely exploded from there on out.
| Comparing to the web makes bitcoin look pathetic scratching
| around for a problem for its solution over a decade later.
|
| If you're all about Second layer scaling, why not just use
| existing second layers like VISA? If you're transacting via a
| trusted second layer to provide scaling, you might as well have
| that as a layer over the dollar, or gold, or other stable
| asset.
| SkyMarshal wrote:
| The web is the wrong analogy/comparison for Bitcoin. Bitcoin
| was never designed or intended to be anything like the web.
| It was designed to be a money and payments system, no more no
| less. If you must compare it to anything, compare it to
| dollars, euro, yen, gold coins, etc.
|
| You may be thinking of Ethereum and any other "crypto"
| claiming to be "Web 3", where they want to store and run
| entire websites on their distributed database. But that's not
| Bitcoin.
| xnorswap wrote:
| I'm not the one making the comparison, it's people going
| around touting that you should invest because "it's like
| the early internet, it'll be everywhere soon and worth
| trillions".
| masswerk wrote:
| Regarding (1), the real statement here is, "many of us were
| there at the start of the Web, it was evident that it was going
| to change the world, and it was usable from the start." And
| it's mostly about the the Web (but you may include things like
| The Well, which were promising from the start.) The point is
| really about immediately apparent use. And, if you're going to
| date the Web back to the humble beginnings of ARPANET in the
| early 1970s, you've to include hashes published in the NYT
| classifieds in the 1970s/1980s for crypto, as well.
|
| Regarding (2), why not have a functional implementation right
| from the beginning? (Analogously, why have a really bad OS
| fixed by the application layer?)
|
| The point in (3) is really about availability and value in
| times of crisis. Gold is already mined, as you hold it.
| game-of-throws wrote:
| > it was evident that it was going to change the world
|
| That's easy to say in hindsight, but the utility of the
| internet was debated as hotly back then as the utility of
| cryptocurrency is today.
|
| > By 2005 or so, it will become clear that the Internet's
| impact on the economy has been no greater than the fax
| machine's.
|
| https://www.snopes.com/fact-check/paul-krugman-internets-
| eff...
| masswerk wrote:
| It isn't so that the Web wouldn't have gone from boom to
| bust rather immediately (it really began to surface and
| become known to a broader public in around 1996 and about 4
| years later, there was already the burst of the dot-com
| bubble), but it was immediately apparent that the Web still
| had use and that there were plenty of undeveloped use-
| cases. Not sure, if this applies to the crypto market, as
| well.
| matthewdgreen wrote:
| This is all pretty arbitrary. In the context of _pure
| engineering_ timelines, you don't get to just pick arbitrary
| starting points.
|
| The Internet took decades to reach "I can buy cat food from
| my home PC" because that's how long it took the underlying
| computing and networking technologies to go from the first
| recognizable proto-technologies to the point where they
| enabled mass-market usage. If you start your clock in 1994
| (or 2007) you can make that time look shorter, but it doesn't
| change anything.
|
| Similarly Uber was able to launch a GPS-based smartphone app
| only a few years after the first smartphone, because the
| technologies of 3G cellular, OS, portable computing, GUI,
| GPS, distributed systems etc. were all extremely mature by
| the time the smartphone launched. But if you measure from
| earlier points in the "portable computing" timeline you can
| make Uber look like a multi-decade pipe dream.
|
| There's no reason to believe that the technical barriers
| facing cryptocurrency (scaling, UI, key management) will
| follow dramatically slower or faster tech development curves
| than those previous technologies. There are still plenty of
| reasons to question whether there's a "killer app" once the
| tech issues are sorted out, but they clearly aren't yet.
| lucideer wrote:
| To be clear, I'm not disagreeing with the intent behind the
| article, I just think the execution is exceptionally poor. If
| you're going to argue against something, make your arguments
| compelling (your comment's first point is, the author's
| wasn't).
|
| On your second & third points:
|
| 2: Improving tech over time is good. Creating perfect tech on
| day 1 isn't realistic. The early internet was built on a lot
| of tech we no longer use (or are a attempting to move away
| from)
|
| 3: The "I already have gold but no bitcoin in a time of
| crisis" qualifier seems odd and contrived. Gold is a resource
| valued for its scarcity, Bitcoin is an attempt to move away
| from artificial scarcity of fiat to mathematically guaranteed
| scarcity. Ultimately they share problems: mining of physical
| goods is environmentally destructive and tying economic
| prosperity to inflating resource value based on scarcity
| instead of utility is also ultimately problematic for society
| in the long term. So the analogy does work -they're
| fundamentally very comparable. The primary differentiators
| are (a) the scale of cryptomining is greater per-unit than
| for physical resources (+ transactional impact), and (b)
| Bitcoin's got a whole load of extra bad problems that gold
| doesn't: e.g. instability.
| landemva wrote:
| > tying economic prosperity to inflating resource value
| based on scarcity instead of utility
|
| Why would the store of value or the unit of account or the
| medium of exchange (the money) determine prosperity? The
| public accounting ledger provides transparency and
| auditability as a service which can reduce friction to
| economic prosperity. Neither gold nor Bitcoin creates a fun
| day at the beach - or whatever your measure of prosperity
| may be.
| acdha wrote:
| > Even if it did, I don't see what modern tech corps have to do
| with anything - they didn't build the internet. Also, on age,
| the early internet dates back to the 60s and was still
| considered "early" 30+ years later.
|
| I think the tech companies are relevant because they pivoted to
| find useful applications on top of that basic infrastructure,
| which the hundreds of blockchain companies have failed to do.
| AOL made millions even even people were held up by dialup and
| other limitations, for example, because things like chat were
| popular and low bandwidth.
|
| The early internet comparisons are complicated by the history
| of computing - adoption was slow when computers filled a large
| room and cost millions, for example - but I think that has a
| similar story. Even when a PC cost as much as a car and you
| were looking at 300 bps modems on phone lines billed by the
| hour, people found things worth paying for and there were
| profitable companies with fairly large subscriber bases by the
| late 1970s. There were people who met online and were
| grandparents before smartphones became common!
|
| In contrast, blockchains were globally available on day one
| with no constraints other than their design limitations.
| There's no problem which you could point to like a telecom
| monopoly, the severe hardware limitations prior to the mid-90s,
| etc. which would keep popular usage low.
| nightski wrote:
| The limit on Bitcoin that I saw early on was market cap,
| liquidity, and stability. As the first two rise, so should
| the third. It's been a long grind to the market cap today and
| it still has a ways to go.
|
| But to build up that momentum and trust takes a lot of time.
|
| I'm not necessarily saying Bitcoin should do this or that I
| desire it. Just stating one reason why it takes time.
| acdha wrote:
| I don't think it's that simple: Bitcoin is the purest form
| of fiat currency backed by neither sovereign authority or
| hard assets, and the deflationary model encourages hoarding
| unless you're convinced it's permanently going down. That
| combination seems likely to produce volatility even with
| fairly large amounts of capital flowing in.
| snarfy wrote:
| Crypto is basically gambling, and gambling is alive and well.
| This is why I don't see crypto dying anytime soon. It will die
| when a better gamble comes along.
| stephc_int13 wrote:
| Crypto is inherently very different than gambling.
|
| People have been doing highly speculative investment in many
| different areas and this is clearly not something that will
| die.
|
| Crypto has been a fantastic vehicle for that because of the
| hype and the lack of regulation, but this won't last, people
| can't be fooled forever.
|
| Of course there will be other vehicles, hopefully less
| destructive than this one...
| asdajksah2123 wrote:
| Crypto in its current form is worse than gambling.
|
| With gambling, unless it's illegally rigged, you know your
| expected value will be say $0.90 for every $1 you put in.
|
| However, in return, there is a possibility that you may have
| a one in million chance of getting back $100 for the $1 you
| put in.
|
| Crypto, on the other hand, is a Ponzi scheme. It has no
| internal value and the current owners of crypto are paid
| entirely through the money brought in by the future owners of
| crypto.
|
| Now, to be completely fair, I don't think the majority of
| crypto backers perceive it as a Ponzi scheme. There were many
| people working in the space (maybe even the overwhelming
| majority, although that's unlikely to be true anymore), who
| actually believed that Bitcoin had real value because it
| could become a real currency. Similarly, there are people who
| actually believe that Smart Contracts, and NFTs are actual
| useful technologies.
|
| The problem, however, is that
|
| (a) none of those technologies have panned out, possibly
| because blockchain simply does not solve the problems people
| actually face...it solves the problem of "What if the entity
| who owns the database we are recording our transactions in is
| unreliable". In practice, this does not seem to be a major
| problem at all, and further, blockchain appears to be a
| terrible way to solve this problem.
|
| (b) Even if the technologies are useful, the limited tokens
| and the fact that they are largely hoarded by early adopters,
| simply serves to enrich those early adopters, which
| drastically reduces the utility of any crypto based
| technologies for future users, the ones who are actually
| using the technology. Crypto tokens are an implicit tax on
| technology. It would be like if Google was invented, but to
| use Google you necessarily had to pay $0.10 every search, but
| that cost is ridiculously dynamic, often jumping up to
| $1/search as well. Google would never take off and it would
| impose an insane tax on everyone else, and society as a
| whole.
|
| The latter is why crypto in its current form isn't just a
| successful/unsuccessful tech, its an actively society
| damaging technology.
| landemva wrote:
| > largely hoarded by early adopters
|
| Agree with this in that chains like Solana and Ripple are
| controlled by the startup folks or the big VCs. I avoid
| these centralized money grabs.
| SkyMarshal wrote:
| Bitcoin has lost more than 80% of its value at least four times
| in its short 10yr existence. It, and all other crypto, are highly
| volatile. Every time they go through one of these stages, people
| publish articles like these, asking if this time is the end.
|
| But the builders just keep building, advancing the tech and
| extending its capabilities. Largely because cryptocurrencies are
| a fascinating engineering problem, which combine cryptography and
| distributed systems in a way never done before, and which also
| incorporate programming language theory, networking, computer and
| network security, economics, and law into the mix. It's one of
| the most multi-disciplinary technologies there is. Like catnip
| for engineers, they just can't stop building this stuff.
| throwoutway wrote:
| Well there has always been a supply of victims (err investors*,
| but after the last two crashes , what if the well has ran dry?
| gota wrote:
| Right. The real measure is not % of loss from top-value,
| rather it should be # of people that both don't understand
| the technology & have lost money speculating on it (i.e. how
| many people bought into hype and got burned)
|
| There's a finite amount of people to buy-in next cycle
| ayngg wrote:
| Articles like this all read the same way. Sure he can frame his
| student as some kind of expert, but clearly if she is
| referencing youtube videos about price action in crypto she
| doesn't really have an understanding worth framing your
| criticism around. For all of these articles, it feels
| everyone's idea of crypto does not extend beyond dunking on
| stuff dumb retail meme traders (who have no idea what is going
| on) say on twitter instead of the people actually building the
| technology. I'm not even an expert but even I can see the way
| everyone approaches it in such poor faith is like building a
| caricature of what they think crypto is to justify their
| feelings towards it.
| rafaelero wrote:
| If the author didn't bother to mention central banks, monetary
| policy or currency debasement in the article, I don't think he
| quite gets the real value of Bitcoin.
| sdfhdhjdw3 wrote:
| > The current crash (...)
|
| What I keep coming back to is that something worth zero is still
| trading at $20k.
| sshine wrote:
| s/worth/that I value being worth/ :-)
|
| If you want to make a private purchase online, not tied to your
| identity, I really don't see a good alternative.
| axg11 wrote:
| I live in Canada and recently invested a small amount in a
| startup via AngelList RUV. There were two funding options: (1)
| wire transfer, (2) transfer USDC via Ethereum network. One of
| these options is cheaper, faster, and more flexible than the
| other.
|
| Crypto has long been criticized for being gambling and lacking
| utility. I think utility is finally trickling in, although
| currently in limited settings. If you look at _all_ of crypto
| from afar, there is a lot of noise and bullshit. If you zoom into
| the right applications, there are use cases that are gaining
| product market fit.
| spaceman_2020 wrote:
| International transfers might be different but for domestic
| transfers, most countries outside of the west have very robust
| systems already. India's UPI puts any crypto alternative to
| shame with the speed, transaction volume, fees and ease of use.
|
| Sending someone USDC for international payments is admittedly
| much easier, but you're likely going to run into expensive
| regulation on that front since it carries too much money
| laundering risk
| pavlov wrote:
| Wire transfers in North America are literally 40 years behind
| the evolution of bank transfers in EU and UK.
|
| Sending money in Europe is free and increasingly often
| instantaneous 24/7. It will be very difficult for crypto to
| reach the level of convenience available on unified
| infrastructure created through sensible regulation. Lacking
| that, maybe Americans will have to keep settling for all these
| clunky, incompatible intermediated patchwork solutions like
| Zelle and Venmo and USDC-on-Ethereum and whatever.
| kerng wrote:
| Maybe it will be like with China and cedit card usage. China
| just skipped credit cards and does everything in phone. They
| were behind, now they are leading the pack. Countries
| embracing crypto could go similar route.
| FalconSensei wrote:
| another way to read that is that you are not able to get
| food if your phone dies
| axg11 wrote:
| That's the point! Locally, there are great options almost
| everywhere. In Canada, I can e-transfer (Interac) anyone and
| the transfer is ~instant. Across borders the solutions are
| much worse. Crypto is the only payment rail that can
| realistically reach _everywhere_.
| FabHK wrote:
| I think Paypal only got off the ground because the US banking
| system is so amazingly awful (compared to, say, continental
| Europe). Somewhat sad that it still seems to be the case.
| dghlsakjg wrote:
| He lives in Canada.
|
| Canadians don't live in the same country as Americans.
|
| Canadians don't have the same banks as Americans.
|
| Canadians can do money transfers instantly between any bank
| using e-transfer.
|
| He was talking about transferring money out of the Canadian
| network of banks to a foreign entity (guessing based on it
| being denominated in USD).
|
| As a European can you transfer money to, say, Vietnam without
| using clunky 40 year old technology like wires?
| Commodore63 wrote:
| The settlement delay isn't there for technological reasons.
| People think they want instant! fast! until they lose their
| life savings because libertarian tech has no buffers.
| anony23 wrote:
| I thought the settlement delay was so that the banks can
| squeeze out 72 more hours of interest.
| xur17 wrote:
| > Sending money in Europe is free and increasingly often
| instantaneous 24/7. It will be very difficult for crypto to
| reach the level of convenience available on unified
| infrastructure created through sensible regulation. Lacking
| that, maybe Americans will have to keep settling for all
| these clunky, incompatible intermediated patchwork solutions
| like Zelle and Venmo and USDC-on-Ethereum and whatever.
|
| While true, I do think there is value in a permissionless
| protocol that anyone can plug into like this. Anyone in the
| world can send USDC to someone else (and any bank can
| integrate with this). The same can't be said for banking
| systems.
| closewith wrote:
| While there is value in the avoidance of Anti-Money
| Laundering and Know Your Customer regulations, it's also
| not a feature that bodes well for the future lawfulness of
| the ecosystem.
| sdfhdhjdw3 wrote:
| Sending money in the UK is faster than it takes me to open
| the app on the phone to confirm it went thru.
| sidpatil wrote:
| > Lacking that, maybe Americans will have to keep settling
| for all these clunky, incompatible intermediated patchwork
| solutions like Zelle and Venmo and USDC-on-Ethereum and
| whatever.
|
| FedNow is supposed to launch in 2023.
|
| https://www.frbservices.org/financial-
| services/fednow/about....
| ciupicri wrote:
| We must have different definitions of Europe because I live
| in Romania (which has been a member of the European Union
| since 2007) and yet even national transfers are not
| instantaneous if you're doing them in the evening, not to
| mention the weekend. And don't get me started with transfers
| to other European countries.
|
| I also think you meant cheap, not free. By the way I find it
| funny that some banks tax the receiver, so in order to get
| money, you have to lose money :-)
| dcolkitt wrote:
| But that's the point, crypto is a coordination mechanism that
| in most cases serves as an alternative when you don't have
| effective and trustworthy centralized institutions. It's
| pretty clear that (in this case) European financial
| regulators did a good job coordinating an effective and
| efficient electronic money transmission system.
|
| But the whole world is not Sweden. Even in America, which is
| relatively first world with relatively decent institutions,
| our regulators failed to coordinate a decent electronic money
| transmission system. Now imagine being in Turkey or LatAm or
| Sri Lanka. (Or even just being in Europe and needing to
| interface with anywhere outside the European utopia.) Agree
| that decentralized protocols come with many inherent
| inefficiencies and frictions. But when institutions fail, the
| only alternative are decentralized protocols.
|
| In many ways I see the pro- vs. anti- crypto division coming
| down to how much people believe in institutions. Most crypto
| criticisms come down to an appeal to just focus on building
| better institutions rather than waste mountains of talent on
| overly complex decentralized protocols. " _Instead of all
| this on-chain stablecoin nonsense, why don 't we focus our
| efforts on electing better financial regulators, who can
| bring European like money transfers to North America and
| eventually the globe_?"
|
| Whereas I think pro-crypto people (myself included), tend to
| think of any attempts to change public policy as /dev/null.
| Most of the world is saddled with horribly dysfunctional
| institutions, and it's not easy to fix. I have much more
| confidence in our ability to engineer solutions than
| mustering the necessary political and social coordination
| necessary to fix governments, policy, regulators and
| institutions.
| yunohn wrote:
| If it's mainly about transferring money between
| participants, what is the point of each token having its
| own speculative value? Shouldn't crypto be just stablecoins
| then?
| FabHK wrote:
| Good analysis, and you are right. I think purely technical
| attempts to solve current political/social problems are
| doomed, while better institutions can and have been built.
|
| Now, what makes you think that the regulators in well-run
| countries will continue to accept this inefficient and
| unregulated money alternative full of scams?
|
| Crypto currencies could be banned to quite an extent
| (mining, on/off ramps, maybe even the network traffic,
| which is unencrypted, if I am not mistaken.)
| peyton wrote:
| It's banned in China AFAIK and people seem to use it
| there all the time.
| aeternum wrote:
| Those countries that ban it will miss out on the economic
| value. Just as those countries that banned or did not
| invest in early internet infrastructure (for similar
| reasons) are now significantly behind.
| aNoob7000 wrote:
| It is easier for me to call my bank and initiate a wire
| transfer than it is to transfer money via USDC.
|
| I think the assumption a lot of people in crypto make is that
| everyone has a crypto account/wallet setup.
| axg11 wrote:
| Do you live in North America? I would challenge anyone in
| Canada/US that claims it's easier to initiate a wire transfer
| (with zero ability to track progress) vs. send USDC to an ETH
| address.
| gaspard234 wrote:
| I'll take you up on that challenge. I can open open up my
| Wells Fargo app and initiate a wire transfer within 5
| minutes. In fact, I sent $1000 to a home contractors bank
| account earlier this week for no fee. And yes, WF sent me
| email updates of the status. I will concede it took 1
| business day though.
|
| How do I send USDC within 5 mins? I would have to 1) Open
| an account on a crypto exchange app
|
| 2) Go through the KYC process and hookup the same wells
| fargo account to buy USDC.
|
| 3) Purchase USDC, usually while paying a fee. And then
| still wait the day for the funds to be sent from WF to the
| exchange.
|
| 4) Send USDC to address, while also paying a fee.
|
| There is a reason international remittances haven't worked
| as a use case, for ex Coinbase just closed down that entire
| project. How would immigrants who get paid in Cash buy USDC
| and how would their family in Mexico or El Salvador be able
| to convert that USDC into local spendable currency. I hate
| western union but it works better than any crypto money
| sending service.
| anony23 wrote:
| If you count the time for opening an exchange account and
| doing kyc, you should do the same when you talk about
| your bank. You only have to open the exchange account
| once just like you do for your bank. After that it's
| definitely cheaper and faster to send crypto. Whether or
| not it's as secure depends on what bank we are comparing
| to.
| gamblor956 wrote:
| Done.
|
| Opened bank website, selected "Transfer Money", entered the
| recipient and confirmed the amount. Got an email
| notification, and when the wire transfer clears we will
| receive a second email. This is pretty standard for the
| major US banks.
|
| It's like people in crypto have never actually tried to use
| existing money transfer methods and just make up problems
| that don't actually exist.
| vagab0nd wrote:
| For me it's the opposite. I don't want to talk to someone in
| order to send money. Also, you never know how long/much it'll
| take to wire. Sometimes it's done free on the same day, other
| times it gets double charged and takes 2 days for the money
| to arrive.
| iamnotarobotman wrote:
| For those in Canada, the banks and telephone lines were all
| down at one point. Even if you were on a different internet
| provider that was up, you bank would still be down.
|
| So the 'call my bank' option won't work here and wire
| transfer is no different to transferring money in crypto as
| they are both irreversible.
|
| But I don't know how entering a .eth/.sol/etc address or
| scanning a QR code to send USDC over is harder than typing in
| the sort code, account number, IBAN number, etc to do a wire
| transfer.
| UncleMeat wrote:
| > But I don't know how entering a .eth/.sol/etc address or
| scanning a QR code to send USDC over is harder than typing
| in the sort code, account number, IBAN number, etc to do a
| wire transfer.
|
| Because I don't possess any USDC and acquiring some
| requires me to open an account with Coinbase or FTX or
| whatever, send _them_ dollars, and then purchase USDC. And
| even though sending the USDC has a low fee, the exchange
| fee for purchasing USDC is nontrivial (1% at Coinbase).
| jimgo84 wrote:
| The fee part is incorrect. Coinbase offers 1:1 exchanges
| of USD<>USDC with zero fee. On FTX it's the same, USDC
| and USD are treated 1:1 with no fee to convert. Deposit
| dollars, withdraw USDC or vice versa. Aside from these
| zero fee exchanges, many others have significantly lower
| fees for stablecoin<>fiat than they do for crypto<>fiat.
| UncleMeat wrote:
| Fair enough. Still a nontrivial process for me to get any
| USDC.
| nailer wrote:
| Ethereum's famously expensive and slow though.
| dcolkitt wrote:
| Just raised a funding round, and about half the investors
| used USDC and half used wire transfers.
|
| On "famously expensive and slow" Ethereum, the USDC transfers
| took 15 seconds and cost under $2. Oh and even better, I was
| able to just use a simple human readable [X].eth address,
| instead of an incomprehensible string of routing number
| digits.
| nailer wrote:
| Gas is pretty cheap right now as there's little network
| activity due to crypto winter - people are holding their
| crypto.
|
| And yes 15 seconds is slow.
|
| Indeed, a human readable address is nice if you trust
| whoever gave it to you (ENS is naming not identity, someone
| else can register dcolkitt.eth or dcolkit.eth or
| dcollkit.eth if they like).
|
| There's some good bits and some bad bits. Not advocating
| for or against crypto.
| ChadNauseam wrote:
| If you think 15 seconds for Ethereum is slow, you'll hate
| wire transfers
| christophilus wrote:
| And yet it was faster / cheaper / easier for the OP vs the
| traditional banking mechanisms. That says more about the US
| and Canadian banks than anything else.
| nailer wrote:
| > I live in Canada and recently invested a small amount in
| a startup via AngelList RUV. There were two funding
| options: (1) wire transfer, (2) transfer USDC via Ethereum
| network. One of these options is cheaper, faster, and more
| flexible than the other.
|
| Oh I didn't know that's what the answer was. Having used
| both (and living in Europe), I'd thought the 'cheaper,
| faster' option OP mentioned was a modern wire transfer
| service.
| sebastiansm wrote:
| How did it happen? A country that generates so much
| innovation and lacks quality in his basics systems.
| jjoonathan wrote:
| It's difficult to comprehend just how bad traditional finance
| is at this unless you regularly experience it. No, I'm not
| talking about chafing under regulations against doing crime --
| the number of unforced idiotic bureaucratic errors is
| absolutely off the charts, in addition to being very slow and
| very expensive.
| jqpabc123 wrote:
| _If you zoom into the right applications, there are use cases
| that are gaining product market fit._
|
| A CBDC will supplant most use cases for crypto simply by being
| a practical currency.
|
| What will be left is pretty much what you have now --- criminal
| activity, anarchist cult and naive speculation.
| golergka wrote:
| And even in countries with more useful wire transfer, you
| wouldn't buy drugs with them.
| RandomWorker wrote:
| I haven't used wire transfers in 10 years. Costs were around
| $30 for each $1000 at the time. I use wise.com, and it's less
| than $3 per $1000. It's gotten cheaper as well over time I've
| used the service. Not sure if they use crypto in the background
| but they certainly don't advertise it.
| fabian2k wrote:
| There are probably large differences between countries here,
| but for me a wire transfer would clearly be the cheaper and
| easier option. They don't cost anything in fees. Speed is not
| that great, but usually good enough.
|
| Another option that is often very convenient is the
| "Lastschrift", I can simply grant a company permission to
| withdraw money from my account. The protections for the
| customer are very strong with this, I can revert any withdrawal
| without any reason, so this is essentially no risk for me.
| unicornmama wrote:
| In Switzerland it costs me zero to transfer CHF.
| axg11 wrote:
| With one single integration, AngelList can receive USDC from
| anyone, anywhere in the world. It doesn't matter if you can
| transfer CHF very cheaply locally.
| acdha wrote:
| Kind of like how having a bank account allows you to
| receive wire transfers from anyone? Anything will sound
| simple if you leave out most of the hard parts like meeting
| legal requirements, fraud protection, etc. (better hope the
| reason USDC is cagey about their assets isn't because
| they're hiding something)
|
| It's true that US banks are slower at transfers but most
| people don't hit that often enough to balance out the extra
| cost and risk, and if they started losing significant
| amounts of business it's a lot easier to improve there than
| it is to duct-tape performance, privacy, or fraud
| protection onto a blockchain.
| kareemsabri wrote:
| USDC isn't cagey about their assets. They get audited by
| big-4 financial firms regularly. I don't own a single
| coin and I know that.
| Jetrel wrote:
| Yeah.
|
| I get pretty tilted when people complain about the
| banking system, because most of the "problems" they're
| complaining about are features. A really good metaphor is
| a programmer complaining about being forced to use a
| version control system, and wishing they could just
| dispense with all this pointless waste of time. "All this
| thing does is cause me trouble" -- well, yeah, because
| you've never experienced the problems it utterly
| eradicated.
|
| It's a Chesterton's fence issue at best. At worst, it's
| wolves repealing the laws that prohibit eating sheep.
| unicornmama wrote:
| I've on/off ramped CHF to USDC. It's a pain in the ass. And
| you lose 1% in process. Certainly not easier than a
| CHF->USD wire.
| sshine wrote:
| This is the story in most countries with good economies:
| Local transfers are free for private individuals up to a
| certain amount. Exceed the bounds and you'll be offered a
| paid solution. So if one end of this system pays for the
| other, and the other thinks it's free, you're just paying
| indirectly via price adjustments.
|
| Receiving CHF (Swiss Francs) via an IBAN transfer 1) cost a
| lot, 2) take several days.
|
| Switching to a traditional money transfer provider requires
| KYC'ing.
|
| I was once denied because my website seemed sketchy. It just
| has my company's name and a link to my personal homepage. I
| already have customers, so my first motivation to create a
| website was so that money transfer providers think I'm
| actually running a business and will allow payments.
| Commodore63 wrote:
| It's the latter, right? I can wire USD hundreds of thousands
| from my bank for $25, and the transaction takes place within an
| hour or two.
| somewhereoutth wrote:
| Cryptaceous Extinction Event. Hopefully anything that makes it
| through will actually be beneficial to the world.
| jqpabc123 wrote:
| Crypto is a system of perfect logic built on the foundation of a
| few flawed assumptions.
|
| Relying on YouTube videos that anyone can create is highly
| suspect and should be easily recognized as a logical
| discrepancy/potential fallacy by otherwise intelligent technical
| people.
|
| The fact that it is not points out a huge hole in their
| education, reasoning and thinking process. It is the end result
| of being highly trained but poorly educated in my opinion. Quite
| simply, many crypto cultists failed to grasp the overall limits
| of their own knowledge and control and paid a heavy price for it.
| mypastself wrote:
| Sure, "blockchain is just like the early internet" is a bad
| argument, and one that's used by some proponents. But if you give
| it a more charitable interpretation, such as "Not all successful
| technology is widely adopted within a decade of its inception",
| it's not quite as easy to knock down. Even VR went through (is
| still going through?) a long winter.
|
| The rest of the points are in a similar vein, picking the worst,
| most literal interpretations of the arguments. Of course only
| gold is gold, the argument is that Bitcoin might be used as
| reserve currency.
| stephc_int13 wrote:
| This is all very simple in practice, the blockchain is barely
| useful, crypto coins and NFTs have very low utility.
|
| At some point value and utility always converge.
|
| A good heuristic to predict the value of something: would you get
| them if they were free of charge?
|
| The only difficult thing is to predict when the convergence
| occurs.
|
| The asymptotic value of Bitcoin is $0.
| deepu256 wrote:
| "This is all very simple in practice, the blockchain is barely
| useful, crypto coins and NFTs have very low utility"
|
| Yes. FOR NOW. But public decentralised blockchains have
| interesting properties (enabling ownership , Liquidity ,
| composability) and lots of smart people are trying to use those
| properties to build interesting apps.
|
| These apps are not there yet. I am optimistic that some good
| apps will be launched in next few years that make use of those
| unique properties enabled by decentralised public blockchains.
| p4bl0 wrote:
| The _only_ thing a blockchain can do is a cryptocurrency.
|
| The cryptocurrency is the only application that works because
| transactions are _performative writings_ on the blockchain:
| they _define_ truth. Once it is written on a blockchain that
| Alice has transferred X tokens to Bob, it instantly becomes a
| fact by definition, so you can trust what is written on the
| blockchain.
|
| In _any_ other application, what 's written on the blockchain
| concerns stuff that are external to it. And what's written
| can thus only be valid if an external (and necessarily
| trusted, whether you want it or not) third-party can enforce
| or make what's written on the blockchain to be true. This
| means that any other application cannot actually exists in
| the decentralized and fully adversarial setting that would
| require the use of a blockchain: there is always another,
| more simple, more elegant, more efficient solution that can
| be built on top of the trust that _must_ exists somewhere to
| make things work.
|
| Also, a blockchain _needs_ its cryptocurrency to actually
| work because there has to be an incentive to participate in
| the consensus mechanism whether it is PoW ou PoS or other
| variants, and the incentive cannot be external to the
| blockchain otherwise you need to trust the third-party which
| controls it.
|
| Blockchains and cryptocurrencies are basically the solution
| to their own problem, and to nothing else.
| nprateem wrote:
| Particl has created a decentralised anonymous marketplace
| that uses a smart contract to provide escrow between two
| untrusted parties.
|
| There are bound to be other possible applications. Writing
| off an entire new tech because you can't think of them is
| just narrow minded and silly.
| Wertigoyr wrote:
| But that's the point he made. It's not Blockchain it's
| Blockchain + escrow.
|
| Escrow needs a third party. It destroys all your
| Blockchain advantage.
| [deleted]
| FabHK wrote:
| aka the oracle problem. Indeed.
| blueflow wrote:
| These properties aren't unique, they can be achieved using
| regular asymmetric cryptography. For like, 45 years now.
| deepu256 wrote:
| Ok, then show me a credible 3rd Party where I can store my
| ownership data apart from Government. (Most corporations
| which currently store my data proved that they cannot be
| trusted and they only look after their shareholders. Not
| users.)
| p4bl0 wrote:
| > show me a credible 3rd Party where I can store my
| ownership data apart from Government
|
| Your "ownership data" does not have any intrinsic value.
| It only has value because an external authority (your
| Government's justice institutions) is able to enforce it.
|
| Writing something on a blockchain has no magical effect.
| You cannot remove necessary third-parties like that.
|
| > Most corporations which currently store my data proved
| that they cannot be trusted and they only look after
| their shareholders. Not users.
|
| True, but unrelated.
| deepu256 wrote:
| "My ownership data" has value. perhaps not to you. But
| for people i interact with.
|
| Example :- My education degree is something that I own.
| It can be very useful if I can quickly prove to the world
| that I indeed really have that degree. (like Twitter
| allows to prove you own an avatar NFT) . It would be
| super helpful if this was on a blockchain instead of some
| university database with a cumbersome process to avail
| transcripts.
| p4bl0 wrote:
| > "My ownership data" has value. perhaps not to you. But
| for people i interact with.
|
| I don't think you understood what I meant. I said it has
| no _intrinsic_ value, meaning that it has no value _in
| itself_.
|
| > My education degree is something that I own. It can be
| very useful if I can quickly prove to the world that I
| indeed really have that degree.
|
| The fact that it is written in a blockchain that you have
| a degree has no value in itself, it only works if a
| necessary trusted third-party, the university where you
| got that degree, approves it. You are not in a
| decentralized and fully adversarial setting. You do not
| need (nor want, for efficiency purpose mainly) a
| blockchain to solve this problem.
|
| What you want is a cryptographic certificate (just like
| an X.509 SSL/TLS certificate) of your diploma signed by
| your university, which would play the role of a
| Certificate Authority, and which you can trust because
| the government that accredited your university to deliver
| actual diplomas has a root certificate (it acts as a
| Trusted Certificate Authority) and has signed the one of
| your university with it.
|
| > like Twitter allows to prove you own an avatar NFT
|
| Twitter is a central authority and could very well
| associate any "NFT avatar" with any of its users without
| relying on any blockchain.
| acdha wrote:
| Right, but think about what happens if there's some
| question - say you ran for office and your opponent says
| you're lying about your degree or GPA.
|
| People will trust the institution - if a reporter calls
| them and they say "yes, they earned it" most people will
| not question it. If they say "never heard of them", a
| record on a blockchain won't help much because it
| disagrees with the canonical source and then you'll be
| hearing about how that degree record was published in
| error or fraudulently, or that school is a diploma mill,
| etc.
|
| Electronic records are nice but a 1970s public key
| signature works just as well at a fraction of the cost
| because ultimately it comes down to whether or not the
| reader trusts the issuer.
| blueflow wrote:
| Good example of a signature! The institution who awarded
| you the degree should sign it. They are the authoritative
| source of this information. Everyone who trusts the
| institution will be able to verify your copy of the
| signed document. No communication to the institution
| necessary.
| stephc_int13 wrote:
| People have been saying that for quite some time now, but I
| don't see it.
|
| Why is it so difficult to find utility with this "tech"?
|
| As long are you are not a criminal, ownership and liquidity
| are not huge pain, what is the real, tangible benefit of
| decentralized banking?
|
| I am not convinced that monetary transactions should be above
| the Law, and for them to be lawful they have to be centrally
| regulated in some ways.
| deepu256 wrote:
| It's difficult because blockchains have not yet scaled the
| infra yet. The amount of data that we can currently put on
| most decentralised chains is very less. This will improve
| though and allow us to put a decent amount of data on the
| blockchain.
| p4bl0 wrote:
| This will never solve the oracle problem, which is tied
| to the simple fact that things can happen outside of a
| given blockchain...
| deepu256 wrote:
| "As long are you are not a criminal, ownership and
| liquidity are not huge pain, what is the real, tangible
| benefit of decentralized banking?"
|
| Capital formation for any common purpose without trusting
| 3rd parties. As an example -> there are some NFT vault DAOs
| where strangers pool together to purchase NFTs that are too
| costly. People Vote on proposals regarding which NFT to
| acquire and when.
| AlexandrB wrote:
| This value of this kind of thing depends on NFTs having
| value, which I would dispute. As soon as a DAO tries to
| buy anything in meatspace (a house, a painting, a book),
| you're back to an oracle problem where _someone_ has to
| be trusted with the custody or upkeep of the physical
| item and no amount of DAO votes can force them to do
| something they don 't want to do.
| jonfw wrote:
| crypto climate change
| noasaservice wrote:
| Hopefully crypto earth-destroying-comet.
| bluepoint wrote:
| > Concluding, will crypto die? Not likely, these things are like
| vampires, they seem to always rise up again from the dead.
|
| A bit off topic but I would like to read more examples of
| technological vampires or zombies!
| spaceman_2020 wrote:
| Crypto isn't going to die until human greed dies.
|
| VCs are pouring money into this space. Do they care about
| adoption? Nope. They know that this largely unregulated,
| liquidity challenged space that's too technically complex for the
| average rube is the perfect ground to make wild, wild returns.
|
| Unless something changes drastically on the regulation front, the
| story will repeat itself. VCs and early adopters will buy tokens
| in the "ice age".
|
| Come next cycle, the media will start hyping up crypto again,
| bringing the retail rubes pouring in. And then the VCs and early
| adopters will walk away with their 50x returns, leaving retail
| with the bags
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