[HN Gopher] FedNow Is Live
___________________________________________________________________
FedNow Is Live
Author : lavp
Score : 589 points
Date : 2023-07-20 15:00 UTC (7 hours ago)
(HTM) web link (www.federalreserve.gov)
(TXT) w3m dump (www.federalreserve.gov)
| karaterobot wrote:
| > "The FedNow Service is neither a form of currency nor a step
| toward eliminating any form of payment, including cash."
|
| What people are accusing them of is taking steps toward creating
| a digital dollar. This is their response, which is pretty mealy-
| mouthed if it's meant to address those accusations. A better way
| to express a denial would be "the Federal Reserve has no
| intention of creating a digital dollar and is not planning for
| nor working on that project," if indeed that is true.
|
| Because if they DO create one in the near future, then this
| product SHOULD be designed as a step toward that. If they create
| a digital dollar and it uses any version of FedNow, then they're
| liars. If they create a digital dollar and it uses an entirely
| different product, they're incompetent.
| TheDudeMan wrote:
| They're definitely both.
| maerF0x0 wrote:
| > "the Federal Reserve has no intention of creating a digital
| dollar and is not planning for nor working on that project,"
|
| If if that were true at this instant, they could change it at
| whim.
|
| What is really needed is a constitutional protection of
| privacy.
| CameronNemo wrote:
| This seems like a very opinionated take.
|
| The CBDC is still planned. But way far in the future (couple
| years, at least). And why wouldn't it solve settlement itself?
|
| FedNow is shipping today. If it is not the future solution,
| that is fine. It gives us better performance now.
| karaterobot wrote:
| I actually don't have a strong opinion about the digital
| dollar. I learned about it as a concrete idea in this very
| article. My opinion is: sounds reasonable, probably pretty
| complicated to pull off. I am opinionated when it comes to
| bad, weasely non-answers to questions though, if that's what
| you mean.
| CameronNemo wrote:
| _If they create a digital dollar and it uses any version of
| FedNow, then they 're liars. If they create a digital
| dollar and it uses an entirely different product, they're
| incompetent._
|
| The characterization of the Federal Reserve as incompetent
| is the strong opinion I observed. I personally don't agree
| with the logic you communicated. I think a completely
| separate CBDC project that is separate from FedNow is
| perfectly appropriate.
|
| IMO, many policy makers view FedNow as a better ACH.
|
| Whereas, CBDC is a much more controversial project for some
| policymakers.
|
| Separating the two projects offers some risk mitigation and
| ensures we will at least have something usable (1) in the
| short to medium term and (2) even if CBDC is mired in
| political non-consensus.
| karaterobot wrote:
| That's a reasonable response. I was being hyperbolic I
| suppose. What I meant was: if they are working on FedNow
| and a digital dollar at the same time, a more efficient
| use of resources would be to plan for FedNow to be
| interopable with the digital dollar, so that they don't
| have to replace it with something that is in a few years.
|
| Perhaps they are planning for that already. My main
| complaint is the lack of both transparency and clarity in
| the quoted statement. I don't believe their response will
| satisfy anybody who is wondering if the Fed is working on
| a digital dollar, when it would have been very easy for
| them to do that. I sort of expect that kind of needle-
| threading response from private companies and
| individuals, but (naively) expect more transparency from
| public institutions.
| PaulDavisThe1st wrote:
| Consider "We have every intent of creating a digital dollar and
| are actively planning and working on that project BUT FedNow
| has NOTHING to do with that project".
| jjclane wrote:
| Check out https://explore.fednow.org/ for more information and an
| interesting use of Google Maps :)
| ragnot wrote:
| I'm glad the US is finally catching up the rest of the
| world...India already has the Unified Payments Interface (UPI)
| [0]. Additionally, I think fears of this turning into a CBDC are
| overblown. Banks already have to settle transactions between
| banks through reserve transfers via the Fed...this will just help
| automate that process so we can send money from bank account to
| bank account. Like a Zelle or Venmo, but government backed!
|
| [0] https://en.wikipedia.org/wiki/Unified_Payments_Interface
| skybrian wrote:
| India's system is more usable, though, apparently. This seems
| like an improvement but it doesn't do the same thing?
|
| > Because UPI is designed to be intermediated by computers
| rather than by humans, transactional information gets captured
| by the payments company while the transaction is in progress,
| and that can tell the clerk (or cron job) that the payment
| succeeded without them needing access to the bank account.
|
| > This is a fun engineering challenge in many countries, which
| are often overlaying bank transfers as a payment method on top
| of bank transfers as a settlement method.
|
| [...]
|
| > Bank transfers are an extremely small percentage of customer-
| to-business payments in the U.S. In addition to the speed
| issue, which might get improved by FedNow when it launches
| (wags have referred to it as FedLater), bank payments have no
| consistent way to receive metadata, and despite being no-cost
| they compete with well-developed credit card ecosystems which
| credibly offer better-than-free pricing through rewards schemes
| (to the customer, who generally gets to choose which payment
| method they use to transact).
|
| https://www.bitsaboutmoney.com/archive/bank-transfers-as-a-p...
| toomuchtodo wrote:
| Reward schemes are funded by interchange fees funded by
| higher product prices. They are a tax on the entire economy.
| Merchants can push the CC fees to customers who opt to pay
| with CCs vs cheap or free instant payment systems. T-Mobile
| has dropped autopay discounts if you use a credit card vs
| deposit/bank accounts for payment, for example. Walmart wrote
| public comments on this topic supporting the FedNow
| implementation.
|
| Reward systems won't last as merchants push towards FedNow as
| a payment alternative and charge you to use a credit card.
| Nor should they last.
|
| https://news.ycombinator.com/item?id=36012866
|
| > Walmart has observed a severe misalignment of incentives
| that has plagued the payments system in the United States for
| decades. Certain incumbents and large participants enjoy
| massive profits by stifling innovation in payments, ensuring
| that account access is limited to a small number of networks,
| and perpetuating barriers to entry for alternative solutions.
| Controlling this access allows the dominant players to
| extract rents from other payments system participants,
| ultimately resulting in higher costs for all consumers,
| particularly consumers who are unbanked or underbanked.
| staringback wrote:
| My Citi Custom Cash card gives me 5% back on gas station
| purchases (my highest category), even paying the higher
| price at the pump for credit cards I still come out ahead.
| I'm fairly certain Citi is not making 5% on interchange
| fees
| Clent wrote:
| Isn't it easier to assume Citi is recovering the 5% via
| interchange fees versus Citi is losing money every time a
| customer uses an advertised card feature.
| lotsofpulp wrote:
| Citi is definitely not earning 5% via interchange fees,
| this is known. While they might lose some money on the 5%
| for some credit card users that use it correctly, it is
| most likely more than made up for by other credit card
| users who either use the credit card for other types of
| purchases and receive much less in rewards, resulting in
| a net gain.
|
| Or citi has figured out that certain users of the card
| carry a balance and they spend more on interest than it
| costs in Citi in rewards. If the situation changes and
| Citi is losing money, then they change the reward amount.
| lockhouse wrote:
| It is almost certainly from compound interest.
| Spooky23 wrote:
| It's a loss leader that is usually capped. They are
| marketing against other cards in your wallet. Most
| consumers use a card or two so the habit of buying gas
| drives more spend.
|
| Discover does the same thing with quarterly promos. They
| are paying 5% for the first $1500 of Apple Pay/Google Pay
| transactions... an incentive to add Discover to your
| wallet.
|
| Gas is also unique. Our local supermarket chain gives you
| gas discounts for spend. People are always annoyed about
| gas so they fixate on saving $1/gallon, forgetting that
| they spent $1000 at the most expensive grocery chain so
| they can save $12-20 for a fillup. That $12 probably cost
| them $50.
| rvz wrote:
| > India already has the Unified Payments Interface (UPI) [0].
| Additionally, I think fears of this turning into a CBDC are
| overblown.
|
| Yet, India is already working on E-RUPI [0] which _is_ a CBDC
| on top of UPI by the Reserve Bank of India, also shown in the
| same Wikipedia link you just used. Eventually, FedNow will just
| be the rails for a US dollar CBDC.
|
| The next time a protest happens in India after their government
| does something extremely unpopular, you'll see why CBDCs are a
| nightmare not to be ignored. This is why governments around the
| world are working with many central banks with pilot schemes to
| test them out and eventually roll their own.
|
| > Like a Zelle or Venmo, but government backed!
|
| Look where that went for Zelle. [1] A vehicle for rampant fraud
| on the system.
|
| [0] https://indianexpress.com/article/explained/what-is-e-
| rupi-d...
|
| [1] https://www.nytimes.com/2022/03/06/business/payments-
| fraud-z...
| JumpCrisscross wrote:
| > _Eventually, FedNow will just be the rails for a US dollar
| CBDC_
|
| This is unfounded. FedNow is a faster classical payment rail.
| CBDCs involve the central bank taking on a customer-facing
| role. The Fed has no desire, nor frankly basis in law, to do
| that. The only reason the two are linked is crypto (a)
| prompted the first serious discussion about American payments
| modernization and (b) promoters are using it as a thread by
| which to hang onto a dream of mainstream crypto.
| Animats wrote:
| The central bank digital currency concept has little to do
| with FedNow. It's denominated in dollars, and is cleared by
| all parties keeping ledgers which are compared if they
| differ. But between the crypto people and some right-wing
| conspiracy mongers, the two are being connected in some
| social media.
| rajagopalvr wrote:
| heard of upi in india? it's one of the best payment system in the
| world.
| mixmastamyk wrote:
| Fantastic, although not a peep from my bank.
|
| Articles seem to imply that it can work in complement to zelle,
| so that may extend it's reach quite a bit, no?
| ProllyInfamous wrote:
| >not a peep from my bank
|
| Why would a for-profit banking institution actively advertise
| for something that will affect its bottom line (e.g. transfer
| fees)..?
| mixmastamyk wrote:
| My bank doesn't charge transfer fees. Not sure what that
| means, credit card fees? That's charged by the network.
|
| Obviates old-fashioned wires I suppose but those are rare and
| fee sometimes waived. Probably save money by reducing
| employee headcount.
| constantcrying wrote:
| Because customers demand it and any bank which has it can
| attract customers from banks which don't.
|
| A system like that exists in Europe already, banks operate
| for profit there too.
| mkhalil wrote:
| Sharing a comment I posted from an earlier submission:
| https://news.ycombinator.com/item?id=36801977
|
| ------------------------------------------------------------
|
| The Federal Reserve announces that its new system for instant
| payments, the FedNow(r) Service, is now live. FedNow(r) FAQ:
|
| >> https://www.federalreserve.gov/paymentsystems/fednow_faq.htm
|
| ------------------------------------------------------------
|
| FedNow(r) Service Provider Showcase (Incl: Service Providers with
| APIs)
|
| Browse service providers that can help you connect, innovate, and
| deliver instant payment products using the FedNow Service.
|
| >> https://explore.fednow.org/explore-the-
| city?id=10&building=s...
|
| ------------------------------------------------------------
|
| Participating financial institutions that are currently live on
| the service:
|
| >> https://www.frbservices.org/financial-
| services/fednow/organi...
|
| ------------------------------------------------------------
|
| Launch Video: https://www.youtube.com/watch?v=wHLnV9wu-5A
|
| Other Official FedNow(r) Videos:
| https://www.youtube.com/@FRBServices/videos
| supernova87a wrote:
| I haven't learned all the details of the service yet, but I hope
| this helps eliminate the ridiculous check-based / Zelle fraud
| that seems to be growing (or at least, seems to be highlighted in
| news and discussion as growing).
|
| The very fact that we have money that can appear to be yours
| initially, but then removed from your account if a check is
| reversed or disputed is costing people in time and $, and
| benefitting fraudsters. (advance fee fraud, Zelle "mistakes", and
| similar). 3 day clearing times that give people an opportunity to
| be scammed.
|
| Although, irreversible + instant payments may open some new types
| of problems for people, I could totally see that. But people will
| need to learn how to deal with this more rational system. Other
| countries are decades ahead of us in that you are the one who has
| to initiate payments from your account, and only you can do that,
| and payments are instant and settled.
| geekrax wrote:
| [flagged]
| [deleted]
| ksenzee wrote:
| Thanks for posting this excellent example of why you shouldn't
| use ChatGPT to summarize documents. Page 4 of the PDF has an
| understandable diagram and list of steps, and this doesn't
| match it.
| causality0 wrote:
| For those in the know, will this break the stranglehold Visa and
| Mastercard have over the entire payments industry and help
| prevent people from being un-personed on a whim?
| photochemsyn wrote:
| The best service the Fed could supply for the average American
| citizen is a federal checking account paying interest at the
| listed Fed rate.
| ChrisArchitect wrote:
| Title could include "instant payments system"
| thomas_ma wrote:
| How can a consumer actually try this to send money? This says
| Wells Fargo is live now but after logging into Wells Fargo I
| don't see any obvious new feature.
| ellisv wrote:
| There's no new feature. It's an old feature (transferring
| money) but faster.
| isignal wrote:
| It is live on star one credit Unions mobile app. On their
| interface, it still requires you to specify the target's
| routing and ac number like an ACH transaction. So not the most
| usable now.
| jabroni_salad wrote:
| Think of it more as an alternative method to fulfill the kinds
| of things that ACH and Wire Transfers are used for. You'll
| probably never see 'this is a fednow function' on any consumer
| facing documentation, but billpay, payroll etc will use it.
| ianburrell wrote:
| I'm assuming that banks and payment services will add it to
| their services. Everything that goes over ACH will gradually
| switch to FedNow. There will be no noticeable difference to
| users except that transfer will be instantaneous instead of
| taking days.
| [deleted]
| [deleted]
| Mortiffer wrote:
| Amazing news. Kinda sad to see that Stripe was not on the list of
| early adopters but I'm sure they will implement it soon.
|
| In Switzerland we build an awesome eBill system ontop of the
| equivalent thing to FedNow. Its all run by Six Group which is the
| biggest Stock Exchange but it is jointly owned by the big banks
| and government. So they all agreed to add this eBilling system.
| Its so much superior to having paper come in the mail all the
| time.
|
| So much is possible once you have instantly confirming
| transactions supported by all banks. Suppliers can assume all
| possible customers have a bank account that can do this in
| contrast to the crazy world of sending paper checks by mail.
| [deleted]
| carlosjobim wrote:
| I've been receiving and sending all my bills and invoices by
| e-mail for the last decade, without any need for some awesome
| or amazing system. I'm sure millions do the same.
| mcny wrote:
| > Suppliers can assume all possible customers have a bank
| account that can do this in contrast to the crazy world of
| sending paper checks by mail.
|
| I wish I, and anyone else, could get a bank account directly
| with the federal reserve bank.
|
| > According to a 2021 report by the Federal Deposit Insurance
| Corporation (FDIC), an estimated 7.1 million adults in the
| United States do not have a bank account. This number
| represents about 2.4% of the adult population.
|
| You could even place limits to "child-proof" such accounts. I'd
| be ok with not allowing the account balance to get below zero
| or exceed the FDIC insured limit. My only condition is nobody
| should be banned from it or kicked out for any reason. You
| could say this account earns no interest (as long as there are
| no account maintenance fees or transaction fees).
| chimeracoder wrote:
| > Kinda sad to see that Stripe was not on the list of early
| adopters but I'm sure they will implement it soon.
|
| Given Stripe's role in the system, it doesn't make sense for
| them to support it until there's sufficient support from the
| banks as well. Until banks support it, it doesn't matter if
| Stripe (or any payment platform) does, because the users won't
| see any benefit.
|
| > Driving the news: "We're tracking it closely," President of
| Product and Business Will Gaybrick says, noting the company is
| not actively working on anything related to FedNow. "I really
| do think real-time payments are going to be a big deal."
|
| > "As I understand FedNow, there isn't yet a mandate, so banks
| don't have to implement it," he added. "For things to
| completely change the landscape of payments, you need universal
| coverage."
|
| > If, for instance, only 30% of banks support FedNow, then it's
| unlikely to become a priority for merchants to adopt the
| system.
|
| https://www.axios.com/pro/fintech-deals/2023/06/14/fednow-st...
|
| > The Financial Technology Association, which represents
| fintechs including Block, Marqeta, Stripe and Wise, among
| others, is urging the Fed to make direct access to the new
| faster payments system, called FedNow, more widely available so
| fintechs can tap the new service without going through banks.
|
| > Generally, only licensed banks have access to the Fed's
| master accounts, giving them clearance to use FedNow's faster
| payments system when it's available, but nonbank fintechs argue
| it's shortsighted to exclude them from the same direct access
| to the new public system. While there is also The Clearing
| House's rival RTP Network, the new FedNow system may provide
| more cost-effective services.
|
| https://www.bankingdive.com/news/fintech-federal-reserve-pay...
| TheCaptain4815 wrote:
| So when can businesses start utilizing this to replace ACH? I run
| a b2b company and right now ACH is our most popular payment
| option, but the settlement time is a pain.
| hathawsh wrote:
| Right away. My organization verified that an account at one of
| our banks could send thousands of dollars to an account at
| another bank, in seconds, and then send it back. It's pretty
| cool. :-)
| ejz wrote:
| I know that these are famous last words on Hacker News, so I post
| them very hesitantly...but presumably this is bad news for Plaid,
| right?
| nimbleplum40 wrote:
| I don't think there's much overlap. Banks aren't using plaid to
| settle up...
| pezdeath wrote:
| Wouldn't it also be real bad news for Zelle? And in theory
| Venmo/Cashapp/etc
| kibwen wrote:
| Zelle is already owned by a consortium of banks. Even if
| FedNow were to make Zelle obsolete, it wouldn't do anything
| to harm the banks, so they ultimately wouldn't care.
|
| Meanwhile, Venmo is owned by PayPal, who deserves to become
| obsolete, so we should all be cheering this on.
| ru552 wrote:
| Not for Zelle/Venmo/etc.. Zelle is for P2P (person to person)
| and FedNow is for A2A (account to account). There are no take
| backs on FedNow so it's not intended to be used for P2P. No
| take backs means no recourse for fraud etc.. FedNow should
| supplant ACH waaaaaaaaaaaaaaay down the line.
| cowgoesmoo wrote:
| There's also no take backs on Zelle, Venmo, or Cash App.
| ru552 wrote:
| I can't speak to Venmo/Cashapp, but Zelle does take
| backs. It's for specific areas of fraud such as the
| fraudster impersonating a government official/agency, or
| things like fake not for profits.
| ArlenBales wrote:
| Question: Can this be used by a consumer to more conveniently and
| securely, and without 3rd party fees, sell things online or in-
| person?
|
| Example 1: Sell a graphics to someone on /r/hardwareswap.
| Currently using PayPal.
|
| Example 2: Sell car in-person. Currently go to bank and have
| buyer hand over cash to deposit in bank.
| ke88y wrote:
| The end users of FedNow are financial institutions, so not
| directly.
| hydrophlask wrote:
| The hope is that banks open it up for their consumers to use.
| Log into your bank app -> send money to friend's bank and it
| will all happen over FedNow under the hood.
| H8crilA wrote:
| I hope so, when it trickles down to the commercial bank user
| level.
|
| That's how it works in pretty much the entire rest of the
| world. PayPal is mostly incomprehensible to Europeans, it
| solves a problem that they never had.
| loeber wrote:
| Not yet for consumer banking. Expect this to get rolled out
| first for transfers between banks and financial institutions,
| then regular businesses.
| openthc wrote:
| Is this something that one (a business) can now (or soon-ish) use
| to send or receive payments?
| EMCymatics wrote:
| I cant help but feeling like this is a huge mistake.
| c0unt wrote:
| > Banks and credit unions of all sizes can sign up and use this
| tool to instantly transfer money for their customers, any time of
| the day, on any day of the year.
|
| Come on... Being capable of sending money to someone easily
| should not be based on the bank.
| ru552 wrote:
| Your money is located somewhere and your recipient has their
| money located somewhere. The places where your money sits needs
| to interoperate with whatever "thing" you're using to send
| money. Presuming that your money sits in a bank/credit union,
| you arrive at the quoted statement. If your money is paper in a
| sack somewhere, you can mail it, but it might not make it all
| the way.
| backtoyoujim wrote:
| how long until it has a section for tipping ?
| hansoolo wrote:
| I am genuinely curious, how is this news? I can do real time bank
| transfers since... I dunno...
|
| I never touched a check in my life and I get my employers payment
| mostly even before the end of the month?
| bingemaker wrote:
| India has got pretty good payments system. UPI is miles ahead.
| Any reason why FedNow can't learn from India and adopt UPI?
| nikolay wrote:
| Another nail in the crypto's coffin.
| natas wrote:
| I'd Just As Soon Kiss a Wookiee!
| natas wrote:
| I am very worried when the government knows/governs money
| transfers; look at china.
| tedivm wrote:
| This is basically just replacing ACH with a faster system.
| atlgator wrote:
| Like Apple photo scanning was basically just for CSAM
| detection, right?
| piperswe wrote:
| What risks does FedNow have that FedACH doesn't have?
| riskable wrote:
| I know you're making a point but there _is_ a distinct
| difference in risk: FedNow transactions happen instantly,
| therefore fraud can take place faster.
|
| That's all though. That's not a good reason to stay on
| FedACH.
|
| For the HN crowd the best way to describe the difference
| between FedACH and FedNow is migrating from a batch-based
| system that settled transactions a few times/day to a
| real-time system. Just like such migrations developers
| and engineers encounter in many normal IT environments,
| real-time systems have their own issues but are also
| capable of so much more and are generally easier to
| improve/evolve.
|
| FedACH was made for big, one-time transfers between bank
| accounts where it wouldn't matter too much if settlement
| took a few days. FedNow was made for _lots_ of small(er)
| instantaneous transactions.
|
| At first FedNow will likely be used as a simple
| replacement for ACH transfers but I suspect that it will
| eventually replace the back ends that handle debit card
| payments (because the prize--which would be taken from
| Visa, MasterCard, First Data, and similar--is too big to
| ignore).
| raincom wrote:
| Feds already get money transfer data without warrants. Recently
| Chase closed my checking account because I use Zelle so often.
| Chase knows all Zelle records because they partially own Zelle.
| I would rather have Feds own the data, rather than banks. When
| banks own data, they make decisions to close people's bank
| accounts without any proof of abuse.
| killjoywashere wrote:
| So, is the cost of moving money at the retail level zero to
| almost negative at this point? I mean, literally, we as a society
| have invested tax dollars to reduce money movement to something
| that's damn near minimum entropy.
| bluepod4 wrote:
| Something something privacy
| vlovich123 wrote:
| Is there a way to restrict my bank to only allow incoming
| deposits to use this for my account? I'm scared of VULNs in a new
| system being abused to withdraw money quickly. Yes, I know the
| bank is on the hook for making me whole, but recovering from a
| financial issue like that is more annoying and time consuming
| than just avoiding it and being a late adopter.
| the42thdoctor wrote:
| So is this gonna kill apps like CashApp and Venmo ?
| no_wizard wrote:
| Is there going to be a universal SDK / API we can use with this?
| This would cut alot of middle companies out of the payments
| industry (or at least put pressure on lowering fees). That would
| be a huge win.
|
| Wish we could do the same for the credit card companies. Would be
| great if the Federal Government could intervene in some way to
| have Visa / Mastercard / American Express / Discover use the same
| API interface for payments. Would dramatically increase
| competition for providers.
| _praf wrote:
| Column is building API's for our direct integration with
| FedNow: https://column.com/fednow/
|
| The network of banks supporting FedNow is still small, so we
| may not see meaningful payment volume for a while compared to
| ACH, Wires, Checks, etc.
| Qworg wrote:
| Even when offered a more competitive option, consumers love
| credit cards - the merchant gets soaked, while they get cash
| back. Given how the networks are, you'd have to have an
| unprecedented collusion of merchants to break the credit
| networks open.
| figassis wrote:
| This is usually never the way it happens. The government does
| not make market ending decisions on a whim. It would have
| already met with the biggest stakeholders and fedNow is likely
| the result of many considerations and compromises. Visa will
| likely not be threatened any time soon.
| uses wrote:
| Currently this works between banks only. Banks have reserves at
| the Fed, and those reserves are what gets adjusted when a
| FedNow transaction happens. The banks then adjust their own
| records on their customers' behalf.
| foobarian wrote:
| So it's like a Bitcoin exchange, but with dollars!
| landemva wrote:
| It's like a centralized exchange in which funds can be
| seized, censored, and the participating brokers are
| licensed. Nothing like bitcoin.
| [deleted]
| tarmon wrote:
| I don't see how this is anything like a crypto exchange, is
| there something I'm missing here?
| RC_ITR wrote:
| Some crypto maximalists ignore many of the intrinsic
| aspects of crypto (decentralized consensus, cryptography,
| etc.) because in their use case, it's just 'digital
| money.'
|
| So when a completely dissimilar example of 'digital
| money' comes up, they equate it to crypto, even though
| _it lacks many of the intrinsic aspects of crypto._
| AmericanChopper wrote:
| Some would say suspiciously so. Which is why some
| commentators think this is being implemented as a
| prerequisite of a CBDC.
| treyd wrote:
| The FedNow project was in the works long before any
| serious CBDC idea was conceptualized.
| AmericanChopper wrote:
| I work with a couple of organisations that have been
| advising public institutions on their investigations into
| CBDCs, and the entire timeline of FedNow development took
| place after CBDCs had initially been conceptualised.
| CBDCs became a mainstream concept in 2016 when the Bank
| of England started discussing them publicly. The Faster
| Payments Taskforce report (which was the basis of
| FedNow's design) came out in 2017, and the Fed announced
| its plans to start work on FedNow in 2019. Many advanced
| economies announced plans to start seriously
| investigating the use of CDBCs in 2021, but they'd all
| been discussing the concept for years at that point.
|
| I don't know whether the fed's investigation into CBDCs
| will result in it adopting one. But FedNow has been
| designed in such a way that it could easily be modified
| to support one. You'd just have to implement a version of
| it where the allowed participants were everybody who's
| allowed to have a bank account, rather than only banks.
| erickf1 wrote:
| It won't take long before all banks are using it. Once the
| banks are using it, employers will begin making payments
| using it. Once employees are receiving digital currency
| payments from employers, cash will end soon after.
| hellojesus wrote:
| Cash likely won't end unless legislatively forced to do so.
| The anonymity is too valuable.
| sfg wrote:
| If it does end, Amazon gift vouchers? What would be a
| better substitute?
| vel0city wrote:
| I've been receiving my payments digitally from employers in
| the US for almost 20 years now.
|
| I've never in my life received a wage in cash, as in, hard
| dollars.
| landemva wrote:
| I received W-2 wages in cash in the military. I suppose
| I'm old.
| asah wrote:
| ...but with days of delay, where someone else is keeping
| the interest. And maybe charging a transaction fee.
| vel0city wrote:
| > ...but with days of delay
|
| Maybe a long time ago, but I get my pay which is supposed
| to be on the 1st and 15th on like the 13th and 29th or
| something. Getting paid "two days early" is a pretty
| common feature with Direct Deposit these days. It is
| always credited to my account _before_ my actual paycheck
| technically gets posed.
|
| > maybe charging a transaction fee
|
| I imagine someone would be paying for the transaction of
| physically handling all the cash, no? Its not like having
| all the logistics of handling cash to potentially
| thousands of employees is a zero dollar cost. I imagine
| its _massively_ cheaper for everyone to pay whatever
| marginal cost my employer is paying for ACH
| /DirectDeposit through their payroll app than paying a
| ton of people to handle and keep track of the cash.
| arjvik wrote:
| Getting paid early is essentially an automatic "Payday
| loan" provided by whoever you bank with (whatever
| institution receives your payhecks) as a perk of banking
| with them. I personally decline this service, because I
| don't like adding a paycheck-sized liability to my
| accounting books for two days.
|
| My bank seems to trust my paycheck deposits, though, and
| they "clear" (update my balance and become spendable)
| under 24hrs after they show up as "pending."
| vel0city wrote:
| They're based on notification from they payroll company
| about the incoming paycheck. They're not just assumed by
| the bank to be there, and I'm not charged any interest on
| it, so I wouldn't necessarily lump them into the same
| category as "payday loans" which usually carry extremely
| high interest rates and often don't actually have any
| basis on truly knowing if the paycheck is incoming or
| not. Getting paid early is not similar to going to a
| payday loan vendor and getting a loan.
|
| So when my bank is crediting my account with my paycheck
| early, its because my work told them I'm getting paid
| that amount. Otherwise they wouldn't necessarily know of
| the amount. Sure, its like some kind of loan in a way,
| but its essentially paperovering the slowness of the ACH
| to actually clear in a decent timeframe.
| nimbleplum40 wrote:
| Huh? Employers pay employees via direct deposit in many
| (most?) cases. This isn't any different... Either way it's
| money moving from one bank account to another digitally.
| eweise wrote:
| I think most if not all the participating banks are "receive
| only" so there's no one pushing any money yet.
| gumby wrote:
| The fed lists a number of service providers on their page. I
| assume they will now roll out some interfaces. Glad to see
| the US banking system start to catch up with the rest of the
| world ca mid 90s.
| colechristensen wrote:
| No. This is an interface for banks to settle between
| themselves.
|
| A bank does not want to interact with you in the same channel
| as it interacts with another bank.
|
| What there will be are services provided by banks which utilize
| this for instant transfers.
|
| The middle companies between transfers you _want_. Most of the
| actual work is fraud prevention and dispute resolution...
| unless you want the only means of settling a dispute is through
| the courts.
| tiffanyh wrote:
| > _Wish we could do the same for the credit card companies._
|
| For e-commerce, isn't that SRC?
|
| https://www.emvco.com/emv-technologies/secure-remote-commerc...
| rowls66 wrote:
| Shameless plug, but Moov offers a single API for payments. The
| clearing house's RTP system will be supported shortly, and
| FedNow is coming soon after. Check out out here:
| https://moov.io/
| tracker1 wrote:
| Pricing page is all but worthless... no indication what so
| ever about what even basic tier pricing is, or could be.
| rabidonrails wrote:
| Agreed. This is really strange from their pricing page: >>
| Get started for free to test our APIs & unblock your
| development team. Talk to us about your transaction volume
| to get the best pricing with flexibility to grow.
|
| You would think there would _at least_ be a ceiling price.
| Makes me wonder why they can't show _any_ pricing.
| Qworg wrote:
| Not to answer for Moov, but IIRC, they're still open
| source + a paid option with banking partners.
|
| I think the pricing is weird because you can start (and
| run!) for free, while the end to end solution requires
| negotiating with multiple parties.
| _jal wrote:
| Yeah, that's a good one.
|
| "Spend the time and energy to build us into your product
| first and then we can talk price" is not the most
| reassuring of pitches.
| finfrastrcuture wrote:
| that seems like the right answer...
|
| however, the payment itself is almost besides the point. the
| tricky part is the scheme / governance surrounding payments.
| who is liable for what, preventing fraud, etc. these large
| payment actors + the middlemen are more about fostering trust
| networks than moving the actual dollars and cents.
|
| fraud in P2P payment networks (e.g. Zelle) is already a huge
| issue because a lack of a governing actor like a card
| network.[0] a different question is would the government ever
| provide this mediating role / lay out guidelines? would we want
| it to?
|
| https://www.nytimes.com/2022/03/06/business/payments-fraud-z...
| matt_s wrote:
| > cut alot of middle companies out of the payments industry
|
| Those middle companies have lobbyist representation and the
| govt has no intention of cutting any companies out of the
| payments industry.
| incahoots wrote:
| I think you know the answer to your question, more than likely
| this won't see the light of day outside of federal usage.
|
| Far too much lobbying for any REAL competition to shake up the
| industry.
|
| This will be exclusive to the federal government and state
| governments I imagine.
| [deleted]
| mavili wrote:
| > This would cut alot of middle companies out of the payments
| industry
|
| Not really. All it will do is let the same companies change the
| way they handle average citizens' payments.
|
| It's the same as Open Banking in Europe. It is supposed allow
| small businesses to leverage this to enable innovation and all
| that stuff, but when you want to use these APIs you find there
| are limitations on who can actually use it. For example, you
| can only put your service to production by being on a
| "directory" of approved providers, and to be on that directory
| you need something 25k or 50k in an account. So, not really
| that useful for a small startup wanting to make a product out
| of it.
|
| Banking systems are the backbone of world power dominance, big
| players won't let small people share it.
| adventured wrote:
| It's not particularly difficult for a small start-up to come
| up with $25,000 in the US.
|
| That's modest angel investor money in a small city.
| yieldcrv wrote:
| Aside from playing devil's advocate, do you have a sensible
| reason why it should be this way versus another way?
| kelnos wrote:
| I would assume such a system is capable of facilitating
| fraud, so it's probably good to have some kind of
| financial hurdle you have to jump in order to use it? Not
| that having $25k or $50k is a guarantee that you aren't a
| fraudster, but I imagine there are a lot of would-be
| fraudsters who _don 't_ have that kind of cash on hand.
|
| I do think this is a bit of a weak justification, though.
| ncallaway wrote:
| > So, not really that useful for a small startup wanting to
| make a product out of it.
|
| I mean, 50k puts it out of "a couple people starting
| something in their garage", but it doesn't really lock out
| much beyond that. That's pretty close to the franchise fee
| for opening a McDonald's.
|
| Yes, it could be more equitable, but if that's the only
| barrier to access, it's... pretty open for even quite small
| businesses.
| civilitty wrote:
| 50k is small peanuts, even for a friends and family round.
| I'd expect any startup dealing with banking transactions on
| my or my businesses's behalf to have at least that much in a
| bond or escrowed away for counterparty risk.
| JumpCrisscross wrote:
| > _Is there going to be a universal SDK / API we can use with
| this?_
|
| There is probably a neobank opportunity in providing this.
| FedNow is, reasonably, administered by banks. (The Fed doesn't
| want to provide end-user customer service nor incur liability
| for fraud.)
| no_wizard wrote:
| Right. I suppose that makes sense. I'm thinking about ease of
| startup costs for institutions that want to use it
| financially. The Fed would need to support that anyway.
| Perhaps by not limiting a qualifying institution to just
| banks but also opening up access to financial service firms
| would be enough. They could just have some sort of fair
| priced qualifying program that a company has to maintain to
| access it or something
| ericjmorey wrote:
| The Fed is not allowed to compete with member banks. That's
| part of the reason why something like FedNow took so long to
| emerge.
| imtringued wrote:
| Isn't this column's whole shtick?
| 634636346 wrote:
| It will be interesting to see how this affects "toxic,"
| deplatformed, and to some degree debanked (at least from PayPal
| and CC processors) entities, like the KiwiFarms. While this page
| is somewhat vague about the private/public status of the Fed:
| https://www.federalreserve.gov/faqs/about_14986.htm
|
| it seems pretty well established that federally chartered
| corporations, like the USPS and Amtrak (e.g.,
| https://en.wikipedia.org/wiki/Lebron_v._National_Railroad_Pa...),
| are bound by the first amendment, so theoretically the Fed should
| be as well.
|
| That means the usual "it's a private corporation!" defense of
| corporate censorship is probably off the table.
| cempaka wrote:
| Isn't it the case that you still have to have a relationship
| with a bank to have an account to transfer into or out of via
| FedNow in the first place? In that case I don't think this
| would change the picture at all. It's not the _intention_ to
| help the unbanked pariahs, that 's for sure.
| raincom wrote:
| Yes, one doesn't have an account with a participating bank in
| order to receive and send payments via FedNow. It is same
| with Zelle; with Zelle, one sends money to an email or a
| phone number of an intended recipient. Both senders and
| receivers of Zelle need to registered with Zelle from their
| banking apps. USBank and Chase are notorious to close
| accounts who use Zelle heavily, because they see such
| activities as nefarious. Maybe, other banks use Zelle
| transaction history as another point to in order to debank
| people.
|
| I don't want my banks to know who I send money to via Zelle;
| but they do. If banks are happy with customers writing checks
| to 'problematic' people, why they think that frequent Zelle
| activity as source of risk, as long as customers are not
| depositing or withdrawing cash/money orders.
| 634636346 wrote:
| There are still almost 5k banks in the US. Unlike Zelle, if
| this opens to all of them, all you need is one bank.
| evantbyrne wrote:
| I presume the system uses bank account and routing numbers?
| So besides concerns with sharing that information with the
| public, concerned citizens will figure out who they bank
| with, and will most likely be able to easily pressure the
| bank to drop them.
|
| Certain things should be difficult to accomplish in a
| functional society anyways, and administering a profitable
| hate group is one of those things. If not bankrupted by
| their lack of credit card access, they'll eventually run
| into legal troubles from the damage they cause to innocent
| people.
| docmars wrote:
| >concerned citizens will figure out who they bank with,
| and will most likely be able to easily pressure the bank
| to drop them
|
| This should be difficult to accomplish in a functional
| society.
| cempaka wrote:
| > _they 'll eventually run into legal troubles from the
| damage they cause to innocent people_
|
| Which is how this sort of thing ought to be handled, in
| stark contrast to "Chrystia Freeland sends an email to
| the heads of major banks to get troublemakers debanked
| with zero transparency or due process."
| evantbyrne wrote:
| Like the person I was responding to said, there are
| thousands of banks. If not a single one wants to do
| business with this organization, that's not a first
| amendment issue and you don't need to lose sleep over it.
| Being so unpopular that nobody with a shred of decency
| will do business with them is not a rights issue.
| salawat wrote:
| I'm sure British loyalists circa 1776 would have agreed
| with you.
| evantbyrne wrote:
| Nonsense comparison. We're talking about business
| partnerships. If everyone with a shred of decency turns
| your organization away, that's a great litmus test for
| its existence. Worry about the next revolution being
| banked when that becomes a real concern, not over an
| online troll farm that tries to convince vulnerable
| people to end their lives.
| tombert wrote:
| I think KiwiFarms is a cesspool and I think Null in particular
| is an extremely crappy human, but despite that I disagreed with
| the credit card processors pulling them, because they really
| did have a near-monopoly for online payments, meaning that this
| could be considered stifling of free speech.
|
| However, I think I'll have less of an issue for it if there's
| the government-backed means in which to send them money; at
| that point I think the "it's a private company!" defense would
| actually apply to the credit card companies.
| ZoomerCretin wrote:
| This is a dramatic whitewashing of KiwiFarms. KiwiFarms was
| not deplatformed for wrongthink or because people disagreed
| with their ideas. They were deplatformed for coordinating
| harassment campaigns that resulted in at least three
| confirmed suicides. That is not protected speech.
| slily wrote:
| Last I heard, at least one of those "confirmed suicides"
| failed to appear in government databases, which casts doubt
| on its legitimacy (I assume it is one of those counted as
| "confirmed"), and another was associated with outside
| harassment and falsely attributed to KF. I don't know what
| the third one is.
|
| I dislike that site and the general behavior of its users
| too, obviously, but during that time when it was in the
| spotlight I saw plenty of evidence of egregious behavior
| and blatant lies from people campaigning to censor them,
| and much of it seemed to work. It's not hard to see how
| debanking could affect less "problematic" organizations or
| individuals through censorship campaigns (or government
| interference) regardless of your feelings about KF itself.
| qingcharles wrote:
| You're right in this scenario, and people need to
| understand the First Amendment doesn't protect "criminal"
| speech.
|
| OTOH, plenty of sites have been canceled simply due to
| their fucked-up viewpoints that are protected speech.
| docmars wrote:
| Any speech could be attributed to the N-number of suicides
| we unfortunately see happening. This is not a good argument
| for censorship or punitive actions against individuals or
| entities whose speech was followed by a suicide with
| dubious / unproven connections to that speech.
|
| If any speech is to be considered targeted harassment, then
| let the courts decide that in a defamation (or otherwise)
| case to determine damages and reconciliation of those
| damages.
|
| Private entities should not be allowed to limit their
| business services to customers they suspect are behaving in
| a way they disapprove of, especially since these customers
| are not asking for tailored services such as cakes and
| custom websites. Payment providers are the backbone of a
| functioning economy, and problematic speech should never be
| the reason why they deny service.
| hammock wrote:
| What is the Kiwi Farms?
| jcadam wrote:
| Be happy that you do not know.
| LegitShady wrote:
| A toxic website where online trolls discuss other
| personalities, mostly online, in a toxic way.
| lmm wrote:
| A discussion forum similar to, say, Something Awful (or
| indeed HN), with a focus on mocking online misbehaviour and a
| reputation for unpopular political views.
| ZoomerCretin wrote:
| >with a focus on mocking online misbehaviour and a
| reputation for unpopular political views.
|
| A less generous interpretation is that they coordinate
| harassment campaigns against transgender people and have
| caused at least three suicides.
| [deleted]
| polski-g wrote:
| It is nearly impossible to prove what "caused" a suicide.
| xvector wrote:
| It's about as impossible as proving what "caused" someone
| to die after they got run over by a train. They could
| have had a fatal aneurysm in the moments before getting
| run over. Or perhaps it was the train that killed them. A
| perplexing game of probability indeed!
| phpisthebest wrote:
| That was proven to be false.
| ZoomerCretin wrote:
| https://www.motherjones.com/politics/2023/02/kiwi-farms-
| die-...
|
| https://fortune.com/2022/09/05/kiwi-farms-so-bad-
| cloudflare-...
|
| It is anything but false. They bragged about their kill
| count. Do you have any source for your claim?
| lmm wrote:
| The "immediate threat to human life" was not identified
| specifically; the only post meeting that description was
| taken down by moderators in less than an hour (which
| compares favourably with many social media sites'
| response times to similar incidents) and was from a new
| account that hadn't posted anything else, so hardly
| representative of the site's culture.
|
| While I don't know the specifics behind your other link,
| like most articles about it it's using second- and third-
| hand claims; given there was an orchestrated smear
| campaign against the site, I'm sceptical. It was
| certainly convenient that Kiwi Farms was removed from the
| Internet Archive just as articles like this were being
| published, making it impossible to verify or disprove any
| of their allegations.
| Gabriel_Martin wrote:
| "Mocking online misbehavior" is pretty generous.
| prometheus76 wrote:
| The Federal Reserve is a private company with a chair that is
| chosen by the President of the US with advice and consent from
| the Senate, and serves a four-year term. There is no term
| limitation for this office.
|
| The reason the US government has a national debt is because
| that debt is owed to the Federal Reserve, which is a private
| bank that loans the US government money and that sets the US
| monetary policy.
| yieldcrv wrote:
| public / private is a false dilemma
|
| trusts, foundations, and a host of other entities are
| 'orphaned' entities and is essentially a third category which
| is more accurate for the Federal Reserve as well
|
| The Board of Governors is a public entity with an
| appointment, and the rest of the entity has a rotation of
| members and pretty full autonomy on how it runs on the inside
| at the employee level
| landemva wrote:
| It's a club funded by interest rate skimming with opaque
| structure and reporting requirements which don't conform to
| typical reporting requirements. CEO of Silicon Valley Bank
| was on BoD of SFO branch, which failed to adequately
| regulate SVB.
|
| https://www.svb.com/news/company-news/svb-financial-group-
| ce...
|
| "SVB Financial Group CEO Elected to the Board of Directors
| of the Federal Reserve Bank of San Francisco"
| globalreset wrote:
| ... https://www.thebalancemoney.com/who-owns-the-u-s-
| national-de...
| phpisthebest wrote:
| >>Federal Reserve is a private company with a chair that is
| chosen by the President of the US with advice and consent
| from the Senate, and serves a four-year term
|
| Sorry but no... You can not be a "Private Company" and have
| your leadership appointed by the President like any other
| Government Agency
|
| The Fed is a Government Agency,
|
| >>The reason the US government has a national debt is because
| that debt is owed to the Federal Reserve,
|
| Incorrect
|
| Some of the Debt is owned by a Federal Reserve, more recently
| as no one want to buy US Debt any more but....
|
| >>which is a private bank that loans the US government money
|
| Again FALSE....
|
| The Federal Reserve can not Loan the US Government anything
|
| The US Dept of Treasury issues Bonds which are sold on the
| Open Market, 3rd parties then Buy these Bonds, then the Fed
| Buys them
|
| The Fed can not legally buy Bonds directly from the US
| Government. How do you think Black Rock got to be do big...
| landemva wrote:
| The Fed is a contractor with pomp and circumstance to make
| it appear different. Any private group charter can require
| their club leader to be approved by the Pres. and the Pres.
| may or may not play along.
| aidenn0 wrote:
| Did the Fed own significant treasuries prior to QE?
| dools wrote:
| None of what you just said is true, it's libertarian
| propaganda.
| 634636346 wrote:
| >The reason the US government has a national debt is because
| that debt is owed to the Federal Reserve, which is a private
| bank that loans the US government money and that sets the US
| monetary policy.
|
| I'm pretty sure every holder of US Treasuries (including me)
| is owed money by the US government.
| prometheus76 wrote:
| We are both correct.
| dools wrote:
| Not only that but the cash swapped for bonds is also a
| liability of the government, so it is just swapping one
| liability for another.
|
| What we call government debt is just an operational
| vestige.
| Dowwie wrote:
| Who built this? Dev was obviously contracted out.
| arizzitano wrote:
| What makes you think that?
| hydrophlask wrote:
| internally built.
| ishanjain28 wrote:
| Do they have a simpler use id like india's
| upi?(userHandle@bankHandle)
|
| In the demos I watched, There is account number and routing
| number
| mixmastamyk wrote:
| Address book and search can help with that. Worked in NZ
| anyway.
| ishanjain28 wrote:
| well yes but the addressing scheme we use here is so much
| simpler. I hope they incorporate it at some point
| mixmastamyk wrote:
| Hmm, may be biased but don't feel email address format for
| bank accounts is a big win. Seems to confuse rather than
| simplify.
|
| On the other hand routing plus account number is kinda
| long.
| [deleted]
| isignal wrote:
| Yes, that part is unfortunate. It requires full routing number
| and account number. Maybe the phone number to account number
| mapping might be seen as a privacy risk in USA.
| konschubert wrote:
| It is crazy how much credit card companies get paid just for
| making sure that money goes from A to B.
|
| Yes, they also offer fraud protection and chargeback, but in 90%
| of purchases, I don't need those. I have other means of
| establishing trust and recourse, and I just want to send money,
| instantly.
|
| Paying $200 on the internet should cost $0.01, not $10.00.
|
| I think there is tremendous opportunity in unbundling payment and
| fraud protection.
| hahajk wrote:
| My intuition is that the existence of fraud protection probably
| lowers the incidence of people attempting fraud.
|
| I'm someone who (still!) believes in the Bitcoin project but
| I'm hesitant to use it for online payments because if someone
| rips me off there's no one I can go to for help.
| EGreg wrote:
| Here we go. CBDCs are next, and also national Digital IDs.
| https://m.youtube.com/watch?v=uwRSzNTp2ko
|
| Real ID + needing it to browse anything on the Internet:
| https://community.qbix.com/t/the-coming-war-on-end-to-end-en...
|
| From what I see people on HN writing, by and large they downplay
| the risks of these as well as AI. Or alternately seem to suggest
| that CBDCs and national IDs are not coming, and that it's a
| conspiracy theory. However, the "enshittification of Big Tech
| platforms" is already a fact, so they simply complain about it,
| but anytime solutions involving open source, decentralization,
| and utility tokens are introduced, they are violently voted down.
| So -- since no solutions are welcomed, I guess many denizens of
| HN support hurtling toward extreme centralized control. After
| all, we'll be able to _complain_ about it once it's in place, and
| that's enough!
|
| Edit: literally _5 seconds_ after I posted it, I received
| downvotes. Not fast enough for a human to read the message let
| alone explore the links. I wonder if it's even automated by
| keyword now.
| ktosobcy wrote:
| US attitude towards national IDs is amusing, lol
| anigbrowl wrote:
| It's also wildly inconsistent. The same political factions
| (vs individuals) that complain about Real ID _also_ complain
| endlessly about fake ID. They complain about illegal voting,
| but also support the drive to withdraw their states from
| ERIC, which has done a good job in detecting illegal voting.
| Basically they 're sometimes against solutions because their
| complaints infrastructure generates a reliable stream of
| political and financial capital from the credulous.
| rootusrootus wrote:
| [Lightly] amusing is thinking there is a singular attitude in
| the US towards national IDs. And we already have several
| forms of national ID anyway.
| digging wrote:
| Comically, the primary national ID we use is one
| specifically designed not to be a national ID.
|
| The secondary "national" IDs most of us use are simply
| state IDs or driver's licenses. They're not in a federal
| database, but I don't understand how that's meaningfully
| different. It's still a big government tracking system.
| DANmode wrote:
| It _was_ , but curiously, they've removed the related
| verbiage from new issuances.
|
| They used to carry a disclaimer: FOR SOCIAL SECURITY
| PURPOSES * NOT FOR IDENTIFICATION
| delfinom wrote:
| National IDs in the US are never coming because the evangelical
| base of the GOP literally oppose it for being the "mark of the
| beast".
|
| >Here we go. CBDCs are next, and also national Digital IDs
|
| No, this is a long term replacement for ACH, a function that
| the Federal Reserve was already carrying out.
| mistrial9 wrote:
| nothing about singling out people for various reasons and
| depriving them of basic services? read history much?
| mzg wrote:
| The government already has the power to do this -- just ask
| any trans person in the South
| seneca wrote:
| > The government already has the power to do this -- just
| ask any trans person in the South
|
| Any citations on every trans person in the South being
| singled out for denial of services by the government?
| Because that sounds like inflammatory nonsense.
| gadflyinyoureye wrote:
| It's their truth. Don't deny it.
| kemotep wrote:
| Banning gender affirming care effectively is singling out
| transgender people and denying them services[0].
| Additionally there was a recent Supreme Court decision
| allowing businesses to discriminate against people[1].
|
| Additionally in living memory, many businesses and
| government services were segregated by race. In some
| cases some races were denied access to services or those
| services were severely underfunded. The legacy of that
| legal system still has impacts today.
|
| [0]: https://www.usnews.com/news/best-
| states/articles/2023-03-30/... [1]:
| https://www.npr.org/2023/06/30/1182121291/colorado-
| supreme-c...
| pessimizer wrote:
| > Banning gender affirming care effectively is singling
| out transgender people
|
| For children. Or for state funding, but the state doesn't
| pay for the vast majority of plastic surgery.
|
| > Additionally in living memory, many businesses and
| government services were segregated by race.
|
| Race doesn't need affirming medical care, or
| identification to single out. Also, businesses and
| government services weren't abstractly segregated by
| race, they were specifically discriminatory toward black
| people.
| kemotep wrote:
| 1. The grandparent comment asked for "Any citations on
| _every_ trans person in the South being singled out for
| denial of services by the government." The great
| grandparent comment only mentions asking the opinion of
| _a_ transgender person if the government has the power to
| deny services to them. By banning gender affirming care,
| even just for children, wouldn't that be an example of
| government discrimination against transgender people?
|
| 2. The example of racial segregation was to point out an
| additional time that a minority group was discriminated
| against. Black people getting less than adequate medical
| treatment is not them needing specific affirmative care
| and being denied it but an example of discrimination that
| was government sanctioned. Beyond pointing to the two
| sets of laws and their discriminatory natures the link is
| superficial, just another example of legal
| discrimination.
|
| I cannot speak for you but denying the government the
| power to discriminate or oppress minorities and
| empowering the rights of individuals to life, liberty,
| and the pursuit of happiness is worthwhile to me. Which
| is why seeing all these states pass these discriminatory
| laws is disheartening.
| delfinom wrote:
| They don't need a national id to do that. Lmao
|
| Case in point, the no fly lists, they literally don't care
| if they just ban all the John Smiths.
| Aloha wrote:
| I see it as an almost total impracticality to transition from
| our current system to a centralized national identity
| document.
|
| There is no central database of:
|
| * Citizenship
|
| * Births
|
| * Drivers Licenses
|
| * Marriages
|
| * Deaths (SSA death reporting is voluntary and customary by
| funeral homes -not required)
|
| * Education history
|
| * Criminal Records
|
| * Firearm Ownership
|
| * Property Ownership
|
| * Vehicle Ownership
|
| The only thing the feds or even the state government has a
| certain idea of is, how much you made in a given reporting
| period - not that reporting periods always overlap in any
| meaningful way. There is no requirement (as far as I can
| tell) to even request a social security number - most parents
| do, because they want to claim their children on their taxes.
|
| Now, many of those records _do_ exist - they exist at the
| county, state or local level in some manner or fashion - and
| of course, its not standardized either, sometimes its at the
| county, sometimes the state, sometimes at the county or state
| for the same record type based on year. (e.g. Marriages from
| 1902-1962 are in county records, and 1962 to current in
| state, or the other way around.)
|
| Trying to link all of this data in a meaningful way, would be
| a monumental task that would likely require a vast amount of
| manual data matching - and it would still be wrong 40% of the
| time.
| no_wizard wrote:
| They could do an audit and census approach as a one off to
| get all this started. For a national ID though wouldn't you
| only need drivers license / property data / marriage data /
| criminal data / citizenship / births?
|
| Not sure you need firearm / vehicle / education history for
| an ID system
| Aloha wrote:
| It'd be a gargantuan project to do so, just trying to
| match property data alone would be massive.
| solardev wrote:
| We already use social security numbers for everything
| (insurance, credit, etc.). It's pretty much a national ID,
| just a shitty one.
| dboreham wrote:
| USG has issued national ID documents for more than 200
| years. They're called passports.
| singleshot_ wrote:
| Everyone who is sufficiently against national ID must
| never have left the United States, then? Correlation or
| causation, I wonder.
| enstrangement wrote:
| [flagged]
| solardev wrote:
| Between passports, SSNs, state IDs, your birthday,
| homeowner records, and metadata like addresses/phone
| numbers/employers, it's already trivially easy for any
| actor to fingerprint you anyway. Even the private sector
| does this for cheap. To say nothing of biometrics like
| facial recognition, which ironically, the government
| sometimes tries to protect you from (like in Illinois,
| where it's banned).
|
| It's so weird to me that people are afraid of the
| government knowing _who you are_ when like every private
| company asks for the same kind of information all the
| time, and data brokers gobble that up and resell it all
| the time (including to government), and nobody bats an
| eye.
| pessimizer wrote:
| The way they got SSNs through is by promising that it would
| be illegal to use them for identification. The only remnant
| of that is that it (still?) remains illegal to refuse
| services to people who refuse to give their social security
| numbers, although if you do it you'll break customer
| service.
| solardev wrote:
| "Can I see your social security card, please? The one
| that says 'Not to be used for identification' on it?" lol
| DANmode wrote:
| > it (still?) remains illegal to refuse services to
| people who refuse to give their social security numbers
|
| I'd love to read this, for anyone more familiar with the
| legislation/where to find it.
| ksey3 wrote:
| In this case CBDCs (the interest bearing kind) actually have
| the potential of disintermediating banks. Or atleast reducing
| credit/liquidity risk. Grandma's savings/deposits arent going
| to evaporate the next time a bank collapses. Cause her CBDCs
| are going to be sitting in her wallet.
| ahtihn wrote:
| > Grandma's savings/deposits arent going to evaporate the
| next time a bank collapses.
|
| That's already the case.
| compsciphd wrote:
| if they are interest bearing, there will always be some risk
| involved by definition....
| striking wrote:
| I've already read this comment before, just written a different
| way. I promise you I'm not a robot, I just disagree.
| anigbrowl wrote:
| It was obvious from the first line that your post was going to
| be axe-grindey conspiracy fodder. It's not us, it's you and
| your and tightly closed epistemological loops.
| solardev wrote:
| I would love to see government IDs be available as a form of
| auth on the internet. It would open up the possibility of real-
| person communities with fewer bots and trolls.
|
| Similarly with digital payments, I'd much rather trust the
| government with that than some rando cryptobro of the week.
|
| There is nothing extreme about this. The government already
| does both functions in the analog world. It's about time they
| caught up digitally.
|
| Meanwhile some YouTuber screeching about some Bible quote...
| not a convincing start
|
| Edit: didn't downvote you btw, just don't agree that this is a
| bad thing
| niam wrote:
| I don't trust the govt quite as much as you, but could see
| this being a useful govt function if the issuing body didn't
| maintain any record of when, where, or why an ID was used--
| and only acted to verify the authenticity of an ID.
| solardev wrote:
| I don't know if it's really a matter of "trusting" the
| government, but of accepting that they already have access
| to most of my data anyway. Between credit cards, IP logs,
| subpoenas, national security letters, warrantless
| wiretapping, etc., they already know everything there is to
| know about me.
|
| What makes this tradeoff (of convenience vs privacy)
| acceptable to me is not that I trust the government, but
| that I already accept I have near-zero privacy right now,
| as it is. Making it slightly easier for them isn't a big
| deal. I'm not a very exciting person to begin with.
|
| And frankly I suspect that outside of techno-libertarian
| echo chambers, this is the case for most regular people.
| They just don't really care if the government knows about
| them. Not everyone has the same degree of desire/need for
| privacy.
| niam wrote:
| I also fit into that camp of un-interesting people you're
| describing, but I'd say the intersections between privacy
| and law are a bit more underhanded and dangerous than the
| intersections between privacy and corporations.
|
| In legal circles, for example, there's the refrain that
| you should _never_ share unnecessary information with
| police, even if you 're well intentioned and have nothing
| to hide, because innocence isn't a preclusion from being
| royally fucked in court. It's true that "the government"
| as a homogenous blob has mountains of information on you,
| but I guess I'm not so eager to dissolve what few helpful
| divisions within that blob exist.
|
| On the whole though I agree that my information existing
| _somewhere in that blob_ isn 't the hugest deal.
| JohnFen wrote:
| > It would open up the possibility of real-person communities
| with fewer bots and trolls.
|
| I would be 100% unwilling to engage with public online
| communities if I had to reveal my real-world identity to do
| so.
| solardev wrote:
| And that's OK. I'm sure there would still be anonymous
| forums, the 4chans and reddits of the world and such. But
| this would enable real-identity communities that we don't
| currently have, useful for things like public comments and
| discussions for local news (god, those newspaper comment
| sections are horrible right now), government requests for
| comments (like when they're starting a new development or
| changing land use or whatever), things like a public
| version of Nextdoor/Yelp/etc.
|
| The hope is not that it would kill anonymity altogether,
| but that it would create some alternative communities
| linked to real-world identities, and maybe that would help
| people behave better, with real-world decorum, in those
| specific identities. Yeah, some people would never sign up
| for those... and maybe that's OK, as long as the remaining
| community is more civil and thoughtful?
| JohnFen wrote:
| > maybe that would help people behave better, with real-
| world decorum, in those specific identities
|
| I don't think that would be the result, really, because
| when sites do have real identity requirements, it doesn't
| increase civility much, if any.
|
| I think it's the absence of a physical presence that
| makes people feel OK with being less civil. Emotionally,
| it doesn't feel like you're talking with real people.
|
| But I don't know.
| solardev wrote:
| You might be right about that, sadly.
| drivebyhooting wrote:
| It's not even been 100 years and people already forgot.
| solardev wrote:
| US history isn't my forte. Can you elaborate?
| didntcheck wrote:
| > I would love to see government IDs be available as a form
| of auth on the internet. It would open up the possibility of
| real-person communities with fewer bots and trolls.
|
| And reintroduce all the chilling effects of knowing
| everything you say is on a permanent record linked to your
| name. I know the government wouldn't be running the sites,
| but they'd have activity metadata, and data breaches could be
| correlated to work out who the "opaque" ID refers to (perhaps
| it would be possible to mitigate that by having the IdP
| identify users to the site as a hash combining the site and
| the user. Not sure). There are a few types of companies that
| may have a genuine reason for requiring government auth, but
| generally we should not make it easy for Facebook or Google
| to require it
|
| A community with fewer bots and trolls should be accomplished
| with moderation, and not just allowing a firehose of signups
| solardev wrote:
| Can't we have both?
|
| Ideally, the government login/auth would be an opt-in for
| sites where anonymity isn't important. Facebook, for
| example, already has a real-name policy but still has fake
| accounts. Moderation alone isn't sufficient; it's hard to
| keep up with the number of bad actors. Limiting signups to
| verified humans, and possibly validating their nationality,
| can help with that IRT to bots and foreign agents.
|
| It's important that the mechanism be opt-in, though, and
| yeah, metadata would be a problem. But realistically it's
| just a matter of degree... they already have access to all
| of that metadata today with just a subpoena or national
| security letter. Centralizing the login would make it
| easier for them to collect it, but also make it easier to
| audit via government mechanisms (FOIAs, etc.) compared to
| the opacity of private companies (which are under zero
| obligation to reveal how things are stored).
| OGWhales wrote:
| My concern with digital payments is the elimination of cash.
| Having the ability to transfer value without it being
| monitored or blocked is an exceptionally useful property of
| paper money.
| gadflyinyoureye wrote:
| But you might buy things the government doesn't want you to
| have. Real meat? Nope. Religious texts? Nope.
| fatfingerd wrote:
| Which government is that? Even Russia values religious
| faith as a pillar for misinformation.
| solardev wrote:
| China, notably:
| https://en.wikipedia.org/wiki/Religion_in_China#Anti-
| metaphy...
|
| While not an outright ban on religion per se, there is
| continued state pressure against religion: https://en.wik
| ipedia.org/wiki/Antireligious_campaigns_of_the...
| shwaj wrote:
| Or participate in activities the government doesn't want
| you to participate in. Canadian trucker protest? Nope.
| digging wrote:
| Well, it's still possible with barter goods, just a lot
| harder. Isn't there a cryptocurrency that's actually
| private too? (I know Bitcoin is not)
| Vecr wrote:
| Monero. It's not perfect of course.
| kube-system wrote:
| As long as the US continues to have large numbers of
| unbanked/underbanked, that isn't a possibility.
| barkerja wrote:
| > I would love to see government IDs be available as a form
| of auth on the internet
|
| This kind of already exists: https://login.gov
|
| I have to use this to login to the VA.
| rootusrootus wrote:
| It'd certainly be interesting if they opened it up so
| third-parties could use it for authentication.
| JohnFen wrote:
| Oh, please no, unless those third parties used it as an
| option for authentication rather than the only means of
| authentication.
| solardev wrote:
| Totally this. I should've made that explicit in my post.
| Thanks for pointing it out.
| WeylandYutani wrote:
| I agree I'm more concerned about Silicon valley tech bros
| than my own government.
|
| I can vote for Parliament I can't vote for PayPal's board of
| directors.
| drivebyhooting wrote:
| PayPal doesn't have a military and doesn't extract taxes
| from you though.
| kube-system wrote:
| If your government's military wanted to oppress you,
| PayPal wouldn't protect you from the consequences. No
| payment system ever conceived by even the stanchest
| technoanarchist is immune to bullets.
| solardev wrote:
| It's a bit ironic... all this talk about crypto evading
| government hasn't really changed much. Then you have
| multinationals like Meta and Apple that really do have
| more money and power than most governments _because_ of
| their centralization and scale.
| lesuorac wrote:
| PayPal might not but Apple/etc extract a 30% tax from
| everything you do through their stores.
| drivebyhooting wrote:
| Agreed. But I can choose not to use it. I don't buy
| things in the App Store nor do I use pay pal.
| [deleted]
| digging wrote:
| The idea that the USD you earn in a wage is "yours" and
| the government has no right to tax it makes no sense to
| me. They _printed_ the money. Your wage wouldn 't exist
| without the government making the modern economy possible
| (in more ways than just printing it). Many of our jobs
| wouldn't even exist without the government's
| participation in the economy.
| drivebyhooting wrote:
| Holy strawman Batman.
| solardev wrote:
| The military? When was the last time they turned on the
| citizens? I don't live in Tiananmen, thankfully.
| Meanwhile it's private companies that oppress most of us:
| private hospitals, private prisons, private insurances
| companies, private credit bureaus, private banks, private
| tech companies, private surveillance companies, private
| small arms manufacturers and dealers. It ain't the
| government that's crimping my freedoms.
|
| Taxes? So I get some roads and schools and parks and old
| people healthcare, and lose some to corruption. Better
| that than making Bezos and Zucky even richer.
| WillPostForFood wrote:
| Forget the military, when was the last time the
| government used force on its own citizens? Probably 1
| second ago, and thousands of times a day. Are you really
| more oppressed by a private hospital today than you are
| by literally thousands of laws that have penalties that
| will put you in prison? I'm not pro private hospital, or
| anti-law, but let's be real about who has ultimate
| control of your freedom. Even if we grant the threat to
| your freedom by a private [fill in the blank], that
| entity only is allowed to exist by dint of the
| government. Not a coincidence that many of your examples
| are the most regulated industries, or directly in
| business with Government (hospitals, firearms
| manufactures, prisons, insurance companies).
| maerF0x0 wrote:
| > the government used force on its own citizens
|
| The government is authorized by it's own citizens to use
| force on some citizens (such as criminals).
|
| That being said, your point might have been when did the
| government last use force in an unjust manner? That's a
| matter of constant political debate.
| solardev wrote:
| If the question is "are you really more oppressed by the
| private sector than the government"... then the answer
| for me is, 100% yes. Healthcare is a big one (the
| insurance industry, along with Republicans, not wanting
| single-payer). Tax filing is another one (damn you,
| Intuit). Hospital pricing opacity another one (until
| recently).
|
| Meanwhile the government _protects_ many of my
| "freedoms" from private intrusions when it comes to
| things like bankruptcy protections, credit bureau
| limitations, telemarketing, angry gunowners, etc.
|
| I've run into trouble with the law on a few occasions,
| but it was never terribly oppressive -- probably largely
| thanks to my race, class, and politics. If I were a poor
| Black man or a conservative white man, I'd probably have
| a very different view of government.
|
| Thinking about it some more, I think think this just
| circles back to the old "freedom from" and "freedom to"
| debate... not sure that's worth getting too much into
| here, since we're unlikely to change anyone's minds or
| reveal new perspectives.
| rootusrootus wrote:
| > The military? When was the last time they turned on the
| citizens?
|
| 1970, though I hope we aren't at risk of that happening
| again anytime soon. The modern military has been pretty
| good at staying apolitical.
| Bloating wrote:
| I prefer to use my deep pockets to lobby for tax
| loopholes. Easy to do, when the tax code is so convoluted
| 80,000 bureaucrats can't keep track
| DANmode wrote:
| I mean, for all intents and purposes, the US Postal
| Service subsidizes Bezos.
| jkeisling wrote:
| Governments are far harder to remove than tech firms. You
| may be able to ditch Google, but there's only one
| government in your country. And "democracy" doesn't prevent
| state surveillance.
|
| Most politicians back it, so voting differently makes
| little difference. Labour and the Conservatives support the
| Online Safety Bill, the Patriot Act was bipartisan, and
| voters have very little control over the EU and can't stop
| Chat Control. And most of "government" isn't directly
| elected: you can't vote out the NSA, and Congress has
| little power over them either. The government blunts
| corporate abuses but doesn't stop them: revolving doors
| ensure authorities target small fry while big companies
| like Visa keep going unimpeded. And finally, most voters
| don't mind surveillance that much, since government and
| media manufacture consent for it. Don't count on ordinary
| people to "vote it out" until it's too late.
|
| Lobbying against government surveillance helps marginally,
| but it's an eternal struggle. Governments take as much
| power as they can get, while abuses are exponentially
| harder to detect and stop than refusing to grant that power
| in the first place. The "slippery slope" isn't a fallacy,
| it's the record of the last twenty years. Don't let them
| track speech and money with a central ID and digital
| currency, just because you don't like a few tech bros or
| online trolls.
| digging wrote:
| > Governments are far harder to remove than tech firms.
| You may be able to ditch Google
|
| Ditching Google is not the same thing as removing Google
| from governance of your life, though. I don't use Google
| search, but I am sure they know who I am and sell that
| data to anyone who wants it, including government
| agencies which _can 't legally obtain that data on their
| own_ due (ostensibly) to citizen oversight.
| solardev wrote:
| Realistically, the average person has exactly 0 chance of
| "removing" either a government or a big multinational
| company.
|
| However, the average person at least has some _teeny
| tiny_ say in government via democratic processes and
| oversights. They have zero power against a big company
| unless they are a major shareholder.
|
| The fundamental difference of "one person, one vote" and
| "one dollar, one vote" should not be lost in this
| discussion.
|
| Big bureaucracies are terribly disempowering no matter
| who runs them, but in government at least you have some
| tiny amount of representation vs zero in the private
| sector.
| carlosjobim wrote:
| > Meanwhile some YouTuber screeching about some Bible quote
|
| Why do you lie when it takes 1 second to verify the facts? I
| wasn't interested, but clicked on the video and the man is
| talking in a calm and collected manner, not even close to
| "screeching". Or is it always "screeching" when somebody says
| something you disagree with?
| JumpCrisscross wrote:
| > _CBDCs are next_
|
| Nobody has seriously discussed a CBDC for months in the U.S.
| FedNow is the American financial system catching up to the
| 1990s. It has nothing to do with crypto beyond the cursory.
| DANmode wrote:
| FedNow _is_ the system that will give the USD some or all of
| the troublesome properties of a CBDC.
|
| I can't begin to parse your comment.
| rafram wrote:
| Right now, you hold your money digitally with a bank. The
| bank holds its money digitally with the Fed. If your bank
| caught fire, the bank and its insurers would be responsible
| for getting you your money back.
|
| A CBDC would mean cutting out the bank - you would hold
| your money digitally with the Fed, and the Fed would be
| liable for it.
|
| FedNow creates a ledger that allows two banks holding their
| money digitally with the Fed make an instant transfer. You
| never become a direct customer of the Fed, but your bank
| and the bank of the person you're exchanging money with -
| both already Fed customers - have a quicker way to record
| the transfer.
|
| The only relation between FedNow and a CBDC is that the Fed
| is involved, and, like, computers, I guess? Other than
| that, their mechanisms and effects have very little in
| common.
| CameronNemo wrote:
| Powell seriously discussed CBDC in his recent testimony to
| congress. He mentioned it was far off.
| JumpCrisscross wrote:
| > _Powell seriously discussed CBDC in his recent testimony
| to congress. He mentioned it was far off_
|
| It isn't being seriously discussed for implementation. The
| working groups are disbanded. The Fed won't write it off--
| they shouldn't. But CBDCs are as proximate as postal
| banking.
| orf wrote:
| Welcome to 2002 I guess? I'm surprised you couldn't already do
| this.
|
| What happens when you get paid? It comes several days later?
| jbnorth wrote:
| Yes, that's the current state of affairs. My bank receives the
| money in my account from my employer's bank but it takes a
| couple days to clear. Right now many banks will make this money
| available to you right away rather than waiting for it to
| clear.
| aketchum wrote:
| I assume you are being snippy, but to actually answer the
| question: Kinda - if you are paid on Fridays then payroll is
| submitted on Tuesday or Wednesday.
| orf wrote:
| No I'm genuinely asking. You get paid at the end of the
| month, but it actually arrives in your bank 4 or 5 days
| later?
| jrmg wrote:
| Yes. Or the entity doing the payment initiates it a few
| days earlier to ensure timely arrival.
| Spoom wrote:
| ACH is generally overnight. I don't know the internals, but
| if I get paid on Friday, I actually get the money in my
| account on Friday. Perhaps they actually send it a day or
| two early.
| relativ575 wrote:
| No. In my case it'd be same days (15th and 1st) as paydays,
| or earlier if the payday falls in the weekend or holidays.
| rkagerer wrote:
| Are there amount caps?
| jsmith45 wrote:
| The network limit is $500,000 per transaction, although
| individual participants can set specific lower limit, which is
| defaulted to $100,000.
|
| Furthermore any end user interface provided by the bank could
| have its own limit, since FedNow is just a backend service,
| frontends are up to each participating provider.
| flotwig wrote:
| https://archive.ph/FsEaf
| kak3a wrote:
| why? don't we already have Zelle and Venmo that does just that?
| anthonypasq wrote:
| im assuming this means there will be no settlement time when i
| put money from my savings account in to my brokerage?
| mint2 wrote:
| edit oops wrong article - Venmo is only "instant" requiring
| behind the scenes smoke and mirrors and also requires carrying
| balances
| delfinom wrote:
| Zelle is closed to the few banks that partner with the private
| banks that run it. Venmo is a private company that siphons your
| data for sale.
|
| FedNow is a long-term replacement of ACH, which the Fed Reserve
| banks already run. This system is open to all US financial
| entities. The platform also uses a ISO standard
| https://www.frbservices.org/financial-services/fednow/prepar...
| jsmith45 wrote:
| The Federal reserve banks are only one operator of ACH, with
| there also being a second private operator. The fed denies
| that Fednow will replace ACH.
|
| Not sure if that denial makes much sense, although it
| certainly could take a long time to replace ACH even if it
| eventually does, simply due to how many systems interact over
| ACH, and that many of them will not be high priority to
| change.
|
| I'm also a little surprised that FedNow went with real-time
| gross settlement, simply because that means posting every
| transaction to a Federal reserve account (which would be a
| large increase in transaction volume for those accounts,
| relative to say daily or even hourly net settlement). Reading
| Operating Circular No. 8 tells me that is exactly what they
| are doing, which is honestly a little impressive.
| maerF0x0 wrote:
| It surprises me because in Canada the Interac e-transfer
| system has been flawless in my anecdotal cases. Albeit one
| known issue is reversals allowing fraud, but I assume any
| non-cryptographic solution will have the same issue.
| bl4kers wrote:
| Zelle has been a nightmare to use. Apparently they rolled out
| a major update that caused many financial institutions to
| drop support. Because of that, my phone number is now
| unusable/blocklisted in their system because it's in a limbo
| state that neither Zelle nor my bank can fix
| latchkey wrote:
| Zelle is being dropped by banks because it is a massive
| source of fraud.
|
| https://www.wfla.com/8-on-your-side/better-call-
| behnken/zell...
| Tommstein wrote:
| It's a coin flip whether Zelle will actually work any time
| I try to use it.
| panarky wrote:
| The press release lists a few big banks like Chase, Wells Fargo,
| BNY Mellon, US Bank and Fiserv, along with a dog's breakfast of
| random service providers and credit unions.
|
| Since free realtime payments presumably would still require both
| the sender and the receiver to use a participating financial
| institution, instead of all participants just transacting
| directly through the Fed, how is this supposed to work if most of
| the industry isn't participating?
| rowls66 wrote:
| There are already other options for instant payments in the US.
| The Zelle network and The Clearings House's RTP have been
| running for several years, and provide pretty good account
| reachability today. FedNow is the result of smaller banks and
| credit unions wanting an alternative to Zelle and RTP which are
| both owned by consortiums of the big banks. The expectation in
| the industry is that there will eventually be interoperability
| between these systems, and it will not make much difference to
| consumers which one their bank uses. Similar to how paper check
| and ACH clearing works in the US today.
| riskable wrote:
| Zelle isn't a good comparison because it's not made for
| things like paying employees or other businesses. It was made
| specifically for payments between individuals and in fact,
| the big banks that run Zelle could very well change the terms
| to specifically forbid using it for things like payroll
| (actually, they might already forbid it but I'm not sure).
|
| FedNow is good for basically everything: Payments between
| individuals, employeers/employees, B2B, etc. More
| importantly, the fees are so low it might as well be
| considered free ($0.045/transfer) which is HUGE.
| msla wrote:
| > The expectation in the industry is that there will
| eventually be interoperability between these systems
|
| Why? Why would the companies presumably making good money
| with Zelle interoperate with something that's stealing their
| customers? It seems like there's no advantage for the entity
| running Zelle to allow interoperability, and there might even
| be ToS language preventing any bank or credit union currently
| in Zelle from so much as moving towards FedNow.
| finfrastrcuture wrote:
| the entire reason FedNow exists is because (simplifying
| somewhat) the large banks launched their own real-time payments
| system (RTP through the Clearing House) and small banks in the
| US lobbied the govt HARD to get a government option out of the
| reasonable concern they would get squeezed by the majors.
|
| nearly all banks in the US should support FedNow within the
| next few years, if not much sooner, as it is seen as
| tablestakes for most bankers.
| numbsafari wrote:
| It takes time for adoption. These were the early adopters, who
| wanted to participate in the design and also be prepared from a
| business standpoint to ready at launch. If it proves it's
| worth, broader adoption will follow. Like anything else.
| ksec wrote:
| This and IRS Tax filling all happening today. From an outsider
| perspective the only two major thing left for US to fix is
| Medical Cost and Public Transport.
| 98codes wrote:
| Zelle: Fuck
| wtmt wrote:
| This is a bit off topic for the post, but relevant for some of
| the comments here.
|
| For those who are commenting about payment systems in India and
| comparing this to UPI (Unified Payments Interface), this is not
| like UPI in a few ways.
|
| Firstly, this is more closer to a faster version of RTGS (Real
| Time Gross Settlement) in India, which is operated by the RBI
| (Reserve Bank of India). Speaking from experience, RTGS in India
| can take several minutes or even 20 minutes or longer, belying
| the "real time" in its name (this is true even now). The FedNow
| system is supposed to be real time (we'll soon know how well it
| performs in comparison).
|
| Secondly, UPI is a payments system by a consortium called NPCI
| that's owned by private, public and foreign banks in India. It is
| not owned by RBI. FedNow is owned by the Federal Reserve, and not
| by a bunch of banks.
|
| With both RTGS (and the slower batched transfer system called
| NEFT) in India and FedNow in the US, the interbank settlement is
| done via the central bank (RBI or Federal Reserve).
| isignal wrote:
| Another difference is the use of phone numbers and simple email
| like identifiers in UPI. That doesn't seem to be part of FedNow
| itself. What makes UPI very usable is that entering the phone
| number or a simple UPI id brings up some metadata about the
| person to confirm that the transfer target is accurate. In
| FedNow such a layer has to be added by Zelle or similar layer
| above, it appears.
| toomuchtodo wrote:
| FedNow intends to support aliases such as phone number and
| email identifiers in the near future.
| umeshunni wrote:
| Well, given that FedNow has nothing to do with UPI, per the
| parent's comment, and it's about inter-bank settlement, it
| makes sense for an application layer like Zelle to provide
| that.
| jschveibinz wrote:
| To clarify, the Federal Reserve is owned by the 12 Federal
| Reserve Regional Banks which are in turn "owned" (as in stock
| that pays a dividend but can't be traded) by the commercial
| banks in that region.
| renewiltord wrote:
| Can I transfer money now to entities that are not
| Visa/Mastercard-linked? e.g. weed stores?
| philipkglass wrote:
| I don't think so. Cannabis businesses are still kept at arm's
| length from banking due to federal law:
|
| https://www.aba.com/advocacy/our-issues/cannabis
|
| It looks like a recent proposal to fix this (the SAFE act) is
| politically stalled:
|
| https://www.politico.com/news/2023/07/14/weed-banking-safe-b...
| efnx wrote:
| Here in NZ you can do this with your bank. Just enter the
| person's acct number and the amount to send in online banking.
| PaulDavisThe1st wrote:
| The working assumption (on the part of the US Federal Reserve)
| is that eventually all/most US banks will use FedNow and offer
| it to their customers (probably via mobile/online front-ends
| developed and sold by B2B third parties).
|
| We'll see if that actually happens.
| lockhouse wrote:
| My concern is that this is a trial run for an official CBDC that
| will eventually replace cash.
| mhovan wrote:
| CBDC is a new acronym for me... For others like me: CBDC ==
| Central Bank Digital Currency
|
| https://www.federalreserve.gov/central-bank-digital-currency...
| lavp wrote:
| What is it about CBDCs you find concerning compared to cash?
| lp0_on_fire wrote:
| It's bad enough that banks have virtually unlimited insight
| into my spending habits that we need to give the Feds the
| same access. I should have the right to buy a big mac without
| some government server getting pinged.
| 1001101 wrote:
| Another concern I have heard voiced is that CBCD could be
| programmed - eg. you can't buy X, or you can only buy Y at
| certain times, or for certain prices, etc. and has the
| potential for reduced liberty vs. cash.
| imtringued wrote:
| It is called EBT and it already exists and the thing is
| people demand this for welfare payments all the time.
| lockhouse wrote:
| It can also be programmed with an expiration date to
| encourage you to spend it to stimulate the economy
| instead of saving it.
| prometheus76 wrote:
| It could also be geofenced. Can't use your phone to buy
| fireworks from out of state because it's illegal in your
| state. Or you can only spend this money at a local store,
| but not at a store in another town.
| imtringued wrote:
| How to get voted out of office immediately.
| EdSharkey wrote:
| You're placing a lot of faith in a system whose power
| would have long-since been stolen from the people.
| prometheus76 wrote:
| Federal Reserve is not an elected office, nor is it a
| government agency. The Federal Reserve is a private
| organization.
| NoMoreNicksLeft wrote:
| How will they protect us though unless they know the nature
| of every transaction we participate in? Are you really
| responsible enough to take care of yourself? A CBDC would
| combine the best aspects of company scrips with those of
| wartime ration tickets!
|
| I think you should reconsider your stance.
| SantalBlush wrote:
| I don't think the government is trying to protect drug
| dealers or tax evaders from themselves. You intentionally
| chose a weak argument to fight against.
| lockhouse wrote:
| Thanks, I forgot about all the new taxes this technology
| could enable. Why not put a tax on every private
| transaction? Maybe have it increase the closer it gets to
| the expiration date.
|
| The amount of people rooting for big brother here on HN
| lately is frankly terrifying.
| SantalBlush wrote:
| I'm not rooting for or against anything other than shitty
| arguments. I come to this site to read smart takes, not
| half-baked sarcastic nonsense. Based on what I'm reading,
| maybe that's asking too much.
| NoMoreNicksLeft wrote:
| I have so many problems in my personal life, and I don't
| know how else they could be solved except for the
| government to carefully micromanage that for me.
| enstrangement wrote:
| I doesn't give the Feds access to anything. Suppose I bank
| at Wells Fargo and my favorite coffee shop banks at Capitol
| One. If I pay the shop $4 for a latte, the fed will have NO
| IDEA who sent that money to whom or for what. All the Fed
| sees is $4 moving from the Wells to the Cap One Federal
| Reserve master accounts -- amid a blizzard of millions of
| other transactions. The difference from ACH is just that
| these payments are settled in big batches rather than one
| by one. The Fed will get new and better data on payment
| volume, but that's all, really.
| rvz wrote:
| When the government does something unpopular against its own
| people, they can easily quell protestors at scale and force
| the usage of CBDC adoption by closing ATM withdrawals [0] add
| savings limits [1] and can incentivise spending with an
| expiring date. [2]
|
| Whilst many HNers were celebrating UPI as the payment rails
| from India, it is almost the same thing as FedNow and is
| planning to put their own CBDC on UPI called E-RUPI [3]
| taking all the same valid concerns that I have mentioned.
|
| Do you _really_ want this?
|
| [0] https://www.pymnts.com/cbdc/2022/nigeria-cuts-atm-cash-
| withd...
|
| [1] https://reclaimthenet.org/digital-euro-spending-saving-
| limit...
|
| [2] https://bfsi.economictimes.indiatimes.com/news/policy/dig
| ita...
|
| [3] https://indianexpress.com/article/explained/what-is-e-
| rupi-d...
| djfobbz wrote:
| For one, unlike cash, the issuing entity can program CBDC to
| expire on a specific date unless utilized. Another horror use
| case is that they could track and limit how many hamburgers
| or pizzas you eat daily, weekly, monthly or yearly!
| [deleted]
| kemotep wrote:
| Why would the government program money to expire? Would the
| money not become effectively worthless the closer to the
| expiration date? Why would a business accept transactions
| from people with money that's about to expire would that
| then mean they would be giving away goods and services for
| free potentially?
| lockhouse wrote:
| In theory you spending it would reset the expiration
| date.
|
| If you know your money will expire you will spend it,
| thus stimulating the economy. We also can't have the
| dirty proles save their way to a higher social class.
| kemotep wrote:
| Where are these theories of how a hypothetical future
| CBDC come from? Is there an official announcement from
| the Federal Reserve about how they would like it to work?
| A committee hearing in Congress where this is discussed?
| DANmode wrote:
| https://www.weforum.org/whitepapers/central-bank-digital-
| cur...
| scottiebarnes wrote:
| The theories come from concerned critics mostly. As far
| as I know there has been no discussion as to how the
| government might influence the functionality of a CBDC.
| DANmode wrote:
| "You could have a potentially [...] darker world where
| the government decides that units of central bank money
| can be used to purchase some things, but not other things
| that it deems less desirable like say ammunition, or
| drugs, or pornography, or something of the sort"
|
| Eswar Prasad, WEF Annual Meeting of the New Champions,
| June 2023
| DANmode wrote:
| https://sociable.co/government-and-policy/governments-
| progra...
|
| The above has some chatter about non-US nations exploring
| the expiry/programmability aspects.
| imtringued wrote:
| I don't get it. The government could just ban the things
| it doesn't want instead.
|
| Also, nothing stops people from buying the goods in
| question by using a payment service provider/bank that
| provides a layer on top of the CDBC and automatically
| circulates the money for you behind the scenes to avoid
| the expiry.
| imtringued wrote:
| There are easy ways to get around this. This isn't
| actually practical to implement. You could just buy and
| sell stocks within a second.
|
| > We also can't have the dirty proles save their way to a
| higher social class.
|
| I don't know what you mean by this. Rich people spend
| their money at a slower rate than poor people so the rich
| would be disproportionately impacted by this. Someone
| living paycheck to paycheck isn't going to have much
| money that can expire to begin with.
| Tyr42 wrote:
| I think Japan did try this, as they really wanted people
| to spe d, vs save.
| oaththrowaway wrote:
| I assume that the TTL of the money would reset once it
| has changed hands
| imtringued wrote:
| The TTL would have to reset at awkward points. Like
| paying out salaries otherwise you could just wash trade
| the TTL away.
|
| I just don't see how this is realistic. It is basically
| impossible to enforce.
| kemotep wrote:
| If you are assuming how a hypothetical future currency
| will work then we could easily assume exactly the
| opposite and the money would be destroyed by a set date
| to maintain some stable rate of deflation. Do you have
| evidence that a time to live for a currency is being
| considered by the Federal Reserve and US government?
| oaththrowaway wrote:
| No, but I have plenty of evidence to suggest that the US
| government doesn't have our best interests at heart...
| kemotep wrote:
| That's fair enough. Ostensibly the government of any
| country should be accountable to the people but history
| shows that cannot be counted on.
|
| As convenient as Apple Pay is, I would not vote for a
| cashless system. I am just confused that very specific
| ideas of how this hypothetical system is going to work
| and am not sure where these come from or why it has to
| work the way people say and not in a more accountable
| less abusive manner. Expiring money seems patently absurd
| so why a central bank would consider it seems so
| outlandish to me at least.
| el-salvador wrote:
| > Expiring money seems patently absurd so why a central
| bank would consider it seems so outlandish to me at
| least.
|
| Some countries, like Costa Rica, do this with cash, but
| with a much longer timeframe. Every 10 years or so they
| launch new banknote designs, and the old ones are
| gradually removed from circulation, until can only be
| exchanged at the banks and eventually lose their value by
| becoming "demonetized".
| ellisv wrote:
| I assume it would accelerate.
| wtmt wrote:
| The government could issue money that can be tied to a
| specific purpose (allowed to be spent with specific
| merchants or establishments) and have a time limit. Think
| of the COVID-19 assistance that was given to people. If
| -- instead of just transferring normal money into
| people's accounts that allowed people to do whatever they
| wanted with it whenever they wanted and wherever they
| wanted - the government could force recipients to spend
| it across certain things and not others, and gave a
| deadline to move the money around, would that be
| something that's in the best interests of the receiver?
| By expiring money or by applying negative interest rates,
| the government can offload its burden on to the people
| who hold and have to use this money.
| sidpatil wrote:
| > For one, unlike cash, the issuing entity can program CBDC
| to expire on a specific date unless utilized.
|
| The idea isn't new.
|
| https://en.m.wikipedia.org/wiki/Silvio_Gesell
| imtringued wrote:
| He merely suggested a small fee though. 5.1% per year and
| only on cash, not some CDBC with privacy concerns. If you
| keep your money on savings accounts you wouldn't pay
| anything. If the economy is growing you would get paid
| interest. If the economy is declining you might pay
| negative interest.
|
| This is different from a coupon that expires instantly.
| That is a terrible idea. Don't do this.
|
| Also, the idea of demurrage currencies is to replace the
| devaluation via inflation with a nominal fee so it is
| possible that in countries with high inflation rates, the
| new currency would end up losing less value over time
| simply because it maintains price stability easily.
|
| Edit: btw. His theory is dated in the sense that Keynes
| and Dieter Suhr have an updated interpretation. With a
| hint of Fisher Black you are going to get one of the most
| interesting economic theories that can explain most of
| the suffering in the world based on very few assumptions.
| The money and land reform policy proposals still remain
| relevant today.
| realce wrote:
| Many ideas aren't new, but that doesn't mean they're
| government policy.
| OGWhales wrote:
| Cash can be spent without being monitored or blocked.
|
| A recent example of how this might be relevant is with the
| protests in Canada that lead to the freezing of the
| protesters' bank accounts by the government. While I don't
| agree with the protesters, the idea of the government
| freezing their accounts is alarming. After seeing such
| control exercised, it's hard to be excited about a cashless
| society.
| adamsmith143 wrote:
| This feels like a boat that sailed long ago. I don't know
| anyone using cash for anything more than small incidental
| purchases, I'd say it's generally impossible to structure
| you life around using Cash at a large scale.
| constantcrying wrote:
| >replace cash
|
| That is the most important concern. Not even crypto can beat
| cash for convenience and anonymity.
|
| But having a way to transfer money outside of large
| corporations and instead through a government regulated service
| is a good thing.
| landemva wrote:
| It makes me question why we allow government to be in charge
| of our money, and the price of money (interest rate meddling
| by govt contractor federalreserve). I suppose we grow up with
| it and don't question it.
| comte7092 wrote:
| Go ahead and question it. What do you think is a reasonable
| alternative? Actually game it out.
|
| Money wasn't always the sole dominion of government. There
| is a reason we've ended up at this point. I find it to be
| entirely reasonable.
| imtringued wrote:
| We have independent central banks because we don't want the
| "government" (I mean politicians) to control our money.
| jrockway wrote:
| The Federal Reserve sets the interest rate that it loans
| money at. You are free to loan money to anyone at a lower
| rate if you wish.
| idiotsecant wrote:
| I mean, that is true in the same way that if I want to
| create some shrutebucks and loan them out at the schrute
| reserve rate you are also free to loan out shrutebucks at
| whatever rate you want.
|
| The fed may have a _small_ advantage you are willfully
| overlooking.
| imtringued wrote:
| If we believe neoclassical theory then if the fed sets
| the rate too high we get deflation and if the fed sets
| the interest rate too low we will get inflation and we
| will get those things very quickly with very little
| delay. This means that the policy rate would have to
| mirror whatever the optimal market rate is.
|
| If we accept some minor inflation, then the fed is always
| setting the rate a bit too low rather than too high.
|
| In other words. Whatever the Fed does, it is mostly
| irrelevant.
|
| On the other hand, if there is actually some leeway and
| elasticity then monetary policy can actually result in
| increases in economic welfare. In this scenario we want
| to see some utilitarian meddling.
| constantcrying wrote:
| >It makes me question why we allow government to be in
| charge of our money
|
| This isn't true. Private currencies exist(ed) and are afaik
| still legal.
|
| The reason we put governments in charge of our money is
| that up until about a decade ago it was either the
| government or a corporation as a decentralizes currency was
| not really implementable. Do you want to get paid in amazon
| coins only redeemable on amazon? No, you do not.
|
| >interest rate meddling by govt contractor federalreserve
|
| You _need_ to do that. Any currency needs some mechanism to
| control issuing. If not the government who else could do
| that?
| NoMoreNicksLeft wrote:
| > This isn't true. Private currencies exist(ed) and are
| afaik still legal.
|
| For most of my life, those were ancient history or
| theoretical. Then in 2009, something changed.
|
| And ever since then, I've seen nothing less than the most
| zealous propaganda campaign to undermine those... it's
| bizarre to watch it unfold. I keep side-eyeing everyone,
| wondering if I'm the only one that sees it. Sure, it
| doesn't help that the cryptocurrency people are whackjobs
| that might have screwed it all up without any outside
| help. But I guess they couldn't trusted to do that, so
| the help was provided.
|
| Saying that it's "legal" doesn't change the fact that if
| someone were to come up with a private currency, gigantic
| forces, government and not, would be arrayed against them
| to put an end to it.
|
| > Any currency needs some mechanism to control issuing.
| If not the government who else could do that?
|
| I think the implication here is: who could be trusted to
| do it in a way that doesn't favor some at the expense of
| others?
| constantcrying wrote:
| >Saying that it's "legal" doesn't change the fact that if
| someone were to come up with a private currency, gigantic
| forces, government and not, would be arrayed against them
| to put an end to it.
|
| Thousands of private currencies exist _right now_.
|
| Nobody would care about your currency, since it is
| useless, and as such worthless. A centralized currency is
| an enormous _social_ asset. Nobody _wants_ private
| currencies.
|
| >who could be trusted to do it in a way that doesn't
| favor some at the expense of others?
|
| Just try to imagine a currency controlled by amazon. Do
| you think they won't do some hyperinflation making you
| poor once a decade?
|
| The controller of a currency has enormous power. If the
| government can't handle it nobody can.
| NoMoreNicksLeft wrote:
| > Just try to imagine a currency controlled by amazon. Do
| you think they won't do some hyperinflation making you
| poor once a decade?
|
| Do you think that the US government and the fed don't do
| this? You don't see it, of course, because they also
| report the numbers you use to decide if there is
| inflation.
|
| And who says that it has to be controlled at all, in the
| sense that some singular entity controls it, rather than
| an algorithm?
|
| > The controller of a currency has enormous power.
|
| Yeh, and it's no less a problem when it's the government
| rather than Amazon.
|
| > If the government can't handle it nobody can.
|
| That's always been my point.
| constantcrying wrote:
| >Do you think that the US government and the fed don't do
| this? You don't see it, of course, because they also
| report the numbers you use to decide if there is
| inflation.
|
| Inflation is an _objective measure_ it is the price
| increase for a certain basket of goods. Yes, you can fake
| it to a certain extent, but this is true for everything.
|
| >You don't see it, of course
|
| What? That is totally false. Inflation is one of the
| easiest metrics to spot.
|
| >And who says that it has to be controlled at all, in the
| sense that some singular entity controls it, rather than
| an algorithm?
|
| Practicality. Either the algorithm is extremely simple
| (BTC) or you will ruin your economy.
|
| >Yeh, and it's no less a problem when it's the government
| rather than Amazon.
|
| Total nonsense.
| imtringued wrote:
| I have thought about building an algorithmic stable coin
| kind of like RAI but the problem is that actually
| defining and measuring a price level is the hard part.
| constantcrying wrote:
| Doing that on a nation state level means betting your
| economy on the algorithm always working correctly.
|
| You also have to be resilient to attacks on your currency
| and an algorithm gives your oppponent certainty on how
| you will react. You _need_ human control at some point.
| HDThoreaun wrote:
| Because it enables monetary policy which is in large part
| responsible for the most successful economic century in
| human history. Why do you think the "natural" interest rate
| is better than the feds?
| carlosjobim wrote:
| Because you get bombed if you don't accept it. There's no
| "we have allowed", it is "they have imposed", and you and I
| were born into a slave system. Thank God there are ways to
| escape, such as crypto and foreign accounts.
| imtringued wrote:
| The ban on bearer bonds should be repealed. People worry
| about cash because it is the only legal option left.
| Analemma_ wrote:
| FedNow is a replacement for ACH which is an ancient, creaking
| monstrosity. If we can't ever replace or fix old, busted
| infrastructure because of conspiratorial rambling, we are
| fucked as a civilization.
| WeylandYutani wrote:
| What has government ever done for us?
|
| https://youtu.be/Qc7HmhrgTuQ
| lockhouse wrote:
| I've seen a lot of crazy conspiracy theories reveal
| themselves to be true in the past five years.
|
| Apply some critical thinking on this. Governments and
| corporate elites worldwide are salivating over the level of
| surveillance and control that a CBDC will enable.
| lxgr wrote:
| Possibly so, but an instant payment system is not a CBDC,
| and I don't see how keeping bank account transfers
| slow/impossible to initiate for individuals (as seems to be
| the case for ACH credit transfers) would help against
| pervasive government surveillance.
|
| ACH and even check clearing are already largely performed
| by the Fed today!
| the-dude wrote:
| Which crazy conspiracy theories are you referring to? I am
| applying some critical thinking here.
| HideousKojima wrote:
| The NSA monitoring any and all electronic communications
| (foreign and domestic) that they can get their hands on,
| without a warrant.
|
| The federal government cutting off financial services for
| legal but disliked industries such as the gun industry
| (see the Obama admin's Operation Chokepoint).
|
| The Canadian government freezing the bank accounts of
| those who supported the trucker protest.
|
| Not directly related to finances or electronic
| surveillance, but some government fuckery greatest hits
| that actually happened:
|
| - Kidnapping hobos and force feeding them LSD
|
| - Intentionally infecting people (mostly black) with
| syphilis
|
| - Feeding irradiated oatmeal to mentally handicapped
| children
|
| - Obama personally ordering the execution of an American
| citizen without trial and having the military carry it
| out (and killing the target's 16-year old American
| citizen son as well)
| the-dude wrote:
| > The NSA monitoring any and all electronic
| communications (foreign and domestic) ...
|
| Not revealed in the last 5 years.
|
| > The federal government cutting off financial services
| for ...
|
| Not revealed in the last 5 years. Was this subject of an
| actual conspiracy theory?
|
| > The Canadian government freezing the bank accounts of
| those who supported the trucker protest.
|
| At least this is within 5 years. I can't judge if this
| was an actual conspiracy theory or not ( I don't think so
| ).
|
| > - Kidnapping hobos and force feeding them LSD
|
| > - Intentionally infecting people (mostly black) with
| syphilis
|
| > - Feeding irradiated oatmeal to mentally handicapped
| children
|
| > - Obama personally ordering the execution of an
| American citizen ...
|
| All of those AFAIK not revealed in the last 5 years.
| carlosjobim wrote:
| I'm writing this post for whoever is interested, so
| please don't take it as specifically directed towards
| you.
|
| People who doubt the government and especially the fiat
| monetary system usually end up as "gold bugs", they start
| preparing for financial collapse by purchasing physical
| gold. Before the 2008 financial crisis, I was involved in
| gold circles online and everybody there knew a huge
| crisis was coming and they were buying as much gold as
| they could. Now, the price of physical gold (and many
| other commodities) are determined by the prices on the
| Comex futures exchange, which are under the control of an
| oligarchy of big banks.
|
| During the financial crisis and the years after, most
| gold traders and gold bugs noticed that the gold price
| would drop every day about 09:00 on the New York Spot
| market, and everybody was talking about how the big banks
| were illicitly manipulating the gold price to try to keep
| it down. Of course this talk was dismissed by uninvolved
| as loony conspiracy theories, together with every other
| insulting and dismissing adjective that commenters here
| are so fond of.
|
| But it turned out that the conspiracy was true, and in
| 2022 a couple of the bankers' fall guys were sentenced,
| and JP Morgan agreed to pay $920 million in fines[1]:
|
| "The evidence at trial showed that between approximately
| May 2008 and August 2016, the defendants, along with
| other traders on the JPMorgan precious metals desk,
| engaged in a widespread spoofing, market manipulation,
| and fraud scheme. The defendants placed orders that they
| intended to cancel before execution in order to drive
| prices on orders they intended to execute on the opposite
| side of the market. The defendants engaged in thousands
| of deceptive trading sequences for gold, silver,
| platinum, and palladium futures contracts traded through
| the New York Mercantile Exchange Inc. (NYMEX) and
| Commodity Exchange Inc. (COMEX), which are commodities
| exchanges operated by CME Group Inc."
|
| [1] https://www.justice.gov/opa/pr/former-jp-morgan-
| traders-conv...
|
| The same things are going on all the time, sometimes the
| perpetrators are banking giants, sometimes the government
| or parts of government, sometimes tech giants, sometimes
| it's all of them together, sometimes other perpetrators.
| HideousKojima wrote:
| My first two rules of investing are:
|
| #1 Don't bet more than you're willing to lose.
|
| #2 The market can stay irrational longer than you can
| stay solvent.
|
| These are widely known and I make no claims of
| originality. However, your story about gold market
| manipulation brings up a corollary to my #2 rule that I
| do take credit for: Never underestimate the extent to
| which governments and other vested interests will go to
| in order to keep markets irrational for as long as
| possible.
| EdSharkey wrote:
| I cannot abide. What is your point? That the last 5 years
| have seen _fewer_ true conspiracies and clownish
| gaslightings? Are you quibbling over the number 5 or
| something?
| realce wrote:
| "The diabolical criminals in power have done everything
| you say, but I quibble about the timeline you spoke of"
| is not a dunk like you might think.
| HDThoreaun wrote:
| Ah so we are fucked as a civilization.
| adamsmith143 wrote:
| > I've seen a lot of crazy conspiracy theories reveal
| themselves to be true in the past five years.
|
| Such as what?
|
| >Apply some critical thinking on this. Governments and
| corporate elites worldwide are salivating over the level of
| surveillance and control that a CBDC will enable.
|
| How is this any different from the current system? Your
| cash is 99% digital anyway with basically every transaction
| completely monitor-able to the Feds under the right
| circumstances. Don't see how this situation would change
| much.
| anononaut wrote:
| The principle difference is that CBDC is programmable
| rather than just digital. We aren't expressing concerns
| over a digital currency, but rather the degree to which a
| nefarious govt will have control over it.
| anthonypasq wrote:
| feel free to only use cash for everything
| geodel wrote:
| And by not availing convenience of FedNow, one can stop
| government in tracks.
| hiatus wrote:
| I read remarks where Yellen said explicitly that if FedNow
| works, they won't need a CBDC. I'll try to dig that up.
| skybrian wrote:
| If a country's government really wants to get rid of a lot of
| large cash transactions, they could phase out some paper money
| like India (no cryptocurrency required) but in the US it
| doesn't seem very likely?
|
| Most money in the US already consists of electronic records in
| banks. Making bank transfers work better is fairly orthogonal
| to whether ATM's work and retailers accept cash.
| yehosef wrote:
| this is what it is.
| codyb wrote:
| I wouldn't worry too much about replacing the US Dollar
| entirely. We're pretty slow even to get rid of the penny. The
| US Dollar has a _lot_ of fans, I'm certainly one of them.
| deathanatos wrote:
| From the FAQ,
|
| > _No. There is no FedNow app. The Federal Reserve does not
| provide payment services directly to consumers and businesses.
| Banks and credit unions can provide their customers with access
| to instant payments through new features_
|
| See y'all in another 25 years, when banks get around to
| implementing this.
| HoyaSaxa wrote:
| For those curious, it is really using IBM MQ[1] under the hood
| and uses a bespoke flavor of the ISO 20022 specification.
|
| The FedNow Service itself is the tip of the iceberg in terms of
| what actually happens from an end-to-end perspective.
|
| We've been working to become a Certified Service Provider so feel
| free to ask me anything. I'm happy to share anything that is not
| under NDA.
|
| [1] https://www.ibm.com/products/mq
| A4ET8a8uTh0 wrote:
| Super curious, were you involved in the implementation of
| ISO20022 from software perspective or were you more on the
| hardware end? Asking because naturally entire banking in US is
| kinda waiting to see hows its implementation going to turn out
| ( for non-fednow payments ).
| HoyaSaxa wrote:
| Software side
| aidenn0 wrote:
| Is the eventual end-game that I can send money from my account
| at Bank A, to a friend's account at Bank B to split a check at
| dinner without using a third party like Venmo?
| mattsan wrote:
| I had to read this twice - is it really not like in the UK?
| Is this the first US implementation of "Faster Payments"?
| Sure people in the UK sometimes use PayPal, Revolut, but most
| of the time its always just a friend gives (and you save on
| your banking app) their bank account number and sort code,
| and you instantly send it across.
| cj wrote:
| I can think of 0 occasions where I've given anyone my bank
| account info who isn't a commercial organization (employer,
| electric company, etc).
|
| I had no idea it was the opposite in the UK.
|
| Edit: with the exception of writing physical checks, of
| course. I use those when the receiver doesn't accept Venmo
| or Apple Pay.
| grepfru_it wrote:
| I am currently disputing an international payment and
| wire transfer (or walking/driving my happy ass to their
| office and paying cash) is the only method allowed by the
| lawyer representing me. That's at least one occasion you
| are not accounting for (a foreign entity that needs the
| equivalent of cash to proceed)
| kylehotchkiss wrote:
| No, Wire Transfers have been the official fast settlement
| method in US for a while. They have a fixed fee associated
| but given the larger transaction amounts that people
| generally use it for, it's not a bad thing. Everyday
| consumers have their silly apps for money transfer (PayPal,
| Cash app, iMessage Cash). Other than that, people are just
| used to transactions taking 2-3 days and over drafting
| because they made another payment and forgot about it. Yay,
| ACH!
| TRiG_Ireland wrote:
| The UK and Ireland have identical banking codes (six-digit
| sort code & eight-digit account number) and constructed
| IBANs the same way (BIC, sort code, account number), but
| Ireland switched to using IBANs domestically, while the UK
| didn't. That means that you in the UK need one interface
| for domestic payments and a different interface for SEPA
| payments, while we use the same for both.
| keenmaster wrote:
| Not OP, but I thought FedNow will do this on day one for
| participating banks. Someone correct me if I'm wrong. FedNow
| will also settle faster than Venmo currently does (unless you
| pay for Venmo's instant settlement) because it's
| instantaneous. To be fair to Venmo, their bottleneck was
| precisely the lack of FedNow. I assume Venmo will make
| instant settlement free. But they will need to add more
| features now that people might substitute with FedNow.
| Anyway, this is a big deal for Americans and was a long time
| coming.
| HoyaSaxa wrote:
| Yes, that is absolutely a use case. Similar to Venmo, there
| is also a Request for Payment (RFP) mechanism. I'm on the
| Request for Payment (RFP) Work Group that is composed of a
| number of financial institutions, service providers, and
| billers.
|
| Netflix is part of the RFP Work Group. So presumably they are
| interested in offering consumers the ability to pay for
| Netflix using FedNow instead of a credit card. Instead of
| Netflix paying ~$0.50 in credit card processing fees per U.S.
| subscription they'll probably be able to find a bank willing
| to charge them < $0.25. It also gives consumers more control
| as they have to authorize each charge.
| govg wrote:
| Have you looked at other systems across the world for
| inspiration / design choices, and if so, could you
| elaborate on how this system compares? For example, the use
| case mentioned is probably the prime use case for UPI in
| India, which has now been extended to become a full fledged
| payment network alongside CC networks etc.
| ke88y wrote:
| _> they 'll probably be able to find a bank willing to
| charge them < $0.25_
|
| I guess that includes some very small values, but the upper
| bound seems ridiculously high.
| kelnos wrote:
| > _So presumably they are interested in offering consumers
| the ability to pay for Netflix using FedNow instead of a
| credit card._
|
| I do wonder how stuff like this will shake out. I will use
| a credit card, always, with any vendor that doesn't pass
| along credit card fees to the customer in some way. (Why
| would I choose otherwise? The credit card gives me rewards,
| and better fraud protection.)
|
| But more and more, I see companies charging "convenience
| fees" for credit card usage or offering "discounts" for
| cash/debit. Hell, T-Mobile just started requiring you not
| use a credit card to get their $5/mo autopay discount.
|
| So this is all cool (and perhaps would make it easier for
| people who don't have a credit card to pay for Netflix),
| but I don't see why I'd use anything but a credit card to
| pay for my Netflix subscription, unless they offer
| discounts for using FedNow. Which... they probably won't?
| LadyCailin wrote:
| Credit card fees that aren't passed through to you are a
| bit tragedy of the commons. Probably good for them to go
| away. It's fine if you choose to pay them, and it's still
| worth it to you, but otherwise you're forcing everyone
| around you to subsidize your credit card rewards. That's
| not fair.
| oorza wrote:
| Alternatively, everyone not taking advantage of the
| credit card protections isn't taking advantage of what's
| offered around them. Everyone should be subsidizing
| everyone else, because no one should be using a debit
| card to make direct consumer purchases in 2023. It's too
| fraught with risk comparatively, and even the scummiest
| of the sub-prime credit cards give you a grace period to
| not accrue interest.
| aeyes wrote:
| Is there anything special about the IBM MQ implementation which
| makes it worth naming them? It looks like you can connect to it
| using AMQP so I wonder why they wouldn't just say something
| generic like "MQ" or "AMQP protocol".
| smarx007 wrote:
| I assume IBM Message Queue Interface (MQI) is the only
| supported protocol in this installation. Don't know of any
| other compatible brokers to support MQI.
|
| Edit: "The FedNow Service will initially leverage IBM(r) MQ
| MQi Client for the payment message flows." according to
| https://www.frbservices.org/financial-
| services/fednow/blog/a...
| wslh wrote:
| Last time, a decade ago, I played with RabbitMQ and similar
| open source queue system they didn't handle congestion and
| rate limitation well (crashed). From my little experience
| with classical IBM systems like MQ they knew about that
| stuff.
| sjdmdlakziggy wrote:
| I spent a couple years deploying and integrating IBM MQ,
| and I own a couple of services currently that interact with
| it. It was (just a couple years ago) and probably still is
| better than current open source solutions, as long as you
| weren't planning on forking the code for some very specific
| use case that requires heavy modification, or the more
| likely situation of just wanting to save money.
|
| As far as message queues go for something like the federal
| reserve, IBM MQ is really the only option that wouldn't
| raise a lot of eyebrows in the industry. The Fed is not the
| kind of institution that I think people would be lenient on
| for being open and innovative with their software
| solutions, banks really need to know that this thing is
| going to work and they all run IBM MQ themselves already.
|
| This really isn't a surprise to anybody that has spent much
| time programming for banks or payment processors.
| kibwen wrote:
| _> I 'm happy to share anything that is not under NDA._
|
| Meta-questions that you quite possibly can't answer: broadly
| speaking, what parts of this system are under NDA? Why would
| any part of this system be under NDA? Did any government
| agencies impose the NDA, or was it private companies? Is the
| NDA intended to protect those running the system, or is it
| intended to protect those using the system (IOW, is it security
| by obscurity)?
| phdelightful wrote:
| In my line of US government coding (no relationship with this
| project), NDA is orthogonal to security. NDA is used to
| protect confidential vendor information. For example: that
| they have a contract with the government at all (in the case
| of a stealth startup), specific technical capabilities they
| don't want broadcast to their competitors, the size of the
| contract vs. committed resources, etc
| HoyaSaxa wrote:
| Basically everything that is not publicly documented on the
| Federal Reserve's website. Unfortunately, it is really common
| in the financial services space to overuse a NDA. Things like
| specific fraud safeguards, hardware information, network
| diagrams, etc. are all under NDA.
| Ao7bei3s wrote:
| What does a development environment look like, both
| architecturally and simply visually?
|
| Like: Do developers spin up entire fake economies with two
| banks and the fed on their latop, or is it all incremental
| changes to individual microservices in a big permanent test
| setup? Do other banks / service providers / the fed run test
| instances of their systems with fake money for other companies
| to do interop with, like a "global test financial network", or
| do you generally test with "real" money?
|
| What do you see on your screen in day to day developer live?
| Are there like dummy online banking web interfaces? Or is it
| all text logs?
|
| Is it just normal software development like anywhere else, or
| is there anything that really sets it apart in terms of
| developer workflow?
| Frummy wrote:
| In front of your eyes: TSO-ISPF for everything. IDz for the 5
| seconds per month that code is actually written
|
| Test env: Separate permanent envs. From playground where
| nothing matters, env with some fake data in similar databases
| and variants of all systems, to mirror of prod with
| anonymised data, then prod
|
| There are dummy online banking web interfaces
|
| What sets it apart is that the operating system is painful to
| use and never stops being painful to use. And your employer
| is paranoid and keeps you in a digital prison for security so
| very few permissions so there is no creativity or off-road
| improvisational innovation just assemblyline style
| development
| hathawsh wrote:
| Once the service provider is connected to the Fed (a somewhat
| complex process), it's normal software development. The
| client uses either MQI or JMS to send and receive messages;
| the messages are essentially ISO20022 XML. The development
| environment could be anything (any OS, any IDE). You
| interface those messages with your system of accounts. The
| Fed also provides a simple web UI and a testing network where
| you can test with other participants and run regression
| tests.
|
| From a software development perspective, it's really quite
| normal.
| ccleve wrote:
| Tell us as much as you can about the tech stack. What is going
| to be able to handle truly massive volumes of transactions?
| Database, hardware, communications channels, programming lang,
| everything.
| HoyaSaxa wrote:
| Not trying to side-step the question, but The FedNow Service
| Technical Overview and Planning Guide[1] goes into depth on
| what is not under NDA.
|
| [1] https://explore.fednow.org/resources/technical-overview-
| guid...
| ericpauley wrote:
| I'm no expert on this so this is pure speculation, but what
| immediately jumps out from this document is the amount of
| security- and availability-critical work that depends on
| each member bank. With wire transfers this has historically
| been achieved by gating transfers behind physically
| visiting a branch (not universally true). The synchronous
| nature (recipient must confirm transaction in real-time) of
| transfers may also cause annoying failures when recipient
| banks do maintenance or something at inconvenient times.
| [deleted]
| CobrastanJorji wrote:
| Why would any of it be under an NDA?
| ke88y wrote:
| At the very least, one would hope that credentials and
| perhaps also certain design documents such as threat
| models aren't public.
|
| There may also be implementation details or code which
| are subject to NDA, either from the Fed itself or from
| service providers such as IBM in this case. Sometimes you
| can get that info from a FOIA request, but that doesn't
| negate the fact that the employees working on the system
| are bound by an NDA. The FOIA has to happen and run its
| course.
| seany wrote:
| > threat models
|
| This is exactly the thing you _shouldn't_ put under NDA.
| What on earth?
| mistrial9 wrote:
| guess -- knowing the currently discussed threat models is
| a competitive advantage for the dozen fintech security
| firms that are in on this, and a "moat" against the other
| four hundred fintech security firms that are frantically
| trying to find a way to get inside this obviously well-
| funded Big Gov project.
| rkagerer wrote:
| _certain design documents such as threat models aren 't
| public_
|
| That smells like security through obscurity (which
| admittedly is the status quo in the banking world).
|
| Contrasted to approaches like Bitcoin, for which full
| code and whitepaper are public, and which has managed to
| survive every attack vector thrown at it for the last
| decade and a half. Not arguing for Bitcoin as money here,
| just highlighting the diverse approaches to security and
| that it shouldn't be taken as a given that hiding those
| details makes it more secure.
| ke88y wrote:
| LOL what? Keeping private keys private is not "security
| through obscurity". Or if it is then basically all
| security is security through obscurity.
|
| No one is posting their private keys on github, and when
| they do their crypto goes poof nearly instantly. None of
| the exchanges publish their threat model documents. I
| sure as shit don't tell people where I store my private
| keys.
|
| The bitcoin whitepaper and code are more analogous to the
| ISO standard, which is public.
| everfree wrote:
| I must have missed something. Wasn't the person you
| replied to talking about design documents? I don't think
| they suggested credentials like private keys should be
| public.
| CobrastanJorji wrote:
| I'm not sure "don't give out the private keys" is the
| sort of thing that needs a special contractual agreement.
| jacobr1 wrote:
| That is exactly that kind of thing that needs to be in a
| contract. When someone inevitably shares private keys and
| it results in some kind of financial loss ... who is
| responsible for the damages? Contracts codify the
| liability if it isn't otherwise defined by statute.
| mfer wrote:
| Security is one good reason.
|
| Fraud and people trying to mess with the system has been
| a long term problem and likely always will be. The
| results of which can hurt people. Keeping details private
| can make it more difficult for those folks.
|
| If we try to prioritize goals of a system like this...
| security for people should be one of the highest. I think
| of the middle income single parent when I envision an
| example of a person in this system.
| wslh wrote:
| What is innovative and/or well engineered there? Could any bank
| or financial institution connect seamlessly with the system?
| How does it handle security keys, transparency, and transaction
| log duration?
| amelius wrote:
| Do you call those things "innovative"?
| dheera wrote:
| Does this end the T + 2day ridiculousness? It should be T +
| 1millisecond at worst. What does it take to update 2 "balance"
| values in databases?
| zeroxfe wrote:
| T + 2day is ridiculous. T + 1ms is also ridiculous (speed of
| light and all.)
| semiquaver wrote:
| Apologies if I've misunderstood you (edit: I have) but
| assuming you are saying that 1ms to transfer funds between
| banks is ridiculously slow, why do you say that?
|
| Light travels about 300km in one millisecond in a vacuum,
| about 200km in optical fiber. The best achievable
| theoretical fiber optic RTT for NYC-LA is about 35-40ms. In
| practice 65ms+ is more realistic due to routing overhead
| and the fact that cables aren't always laid in a great
| circle. This being a financial API with three parties
| involved in most transactions (the two banks and the fed
| clearinghouse) there is sure to be more than one round trip
| involved for TLS establishment, authentication,
| verification of funds and account availability etc, many of
| which involve traversing many inevitably complicated
| systems on each side. It would shock me if such a system
| could realistically target anything less than 500ms P50.
| pyrelight wrote:
| This is the most hacker news conversation ever.
| pksohn wrote:
| I believe the comment you replied to was suggesting that
| 1ms is infeasibly fast.
| semiquaver wrote:
| Ah, thanks! In that case feel free to interpret my reply
| as intended for GP.
| j16sdiz wrote:
| Some transactions can be rolled back asynchronously.
|
| There are physical bank note, database from different
| system in trust or untrusted parties that need to be cross
| checked and reconsolidated
| kibwen wrote:
| Not sure it's even useful to call it a "transaction" at
| that point, since nothing has been transacted. It feels
| like the difference between updating a value in-memory
| and committing a value to the database. Maybe you can
| hide the latency, but that hasn't removed the need to
| actually do the transaction, eventually, and now you have
| the added problem of managing consistency.
| ceejayoz wrote:
| > What does it take to update 2 "balance" values in
| databases?
|
| Quite a bit more than you seem to think.
|
| https://engineering.gusto.com/how-ach-works-a-developer-
| pers...
| abbusfoflouotne wrote:
| This was super helpful, I have always wondered how this all
| worked
| smarx007 wrote:
| The PDF linked in the thread [1] specifies T+20s or no
| settlement.
|
| [1]: https://explore.fednow.org/resources/technical-overview-
| guid...
| HoyaSaxa wrote:
| TLDR: Nearly all payments will irrefutably settle within a
| handful of seconds
|
| Strictly speaking the primary means in which money moves in
| the United States from a volume perspective is ACH today.
| That system is a T+1 day from a default perspective, but it
| has offered the option to same-day settle during a handful of
| batches throughout a business day. However, ACH is not
| irrefutable and so it is common to have holds associated with
| this movement of money.
|
| FedNow is truly 24/7/365 and push only.
|
| All payment flows are subject to an end-to-end payment
| timeout clock of 20 seconds, starting from the creation
| timestamp to the point at which the recipient FI (almost
| always really a Service Provider on their behalf) sends a
| formal response that they intend to accept or reject the
| message.
|
| An accepted payment must then be posted to the receiving
| account "as soon as practicable, but no longer than a few
| seconds" unless there are compliance/fraud concerns.
|
| In practice, it should rarely take 23 seconds and will likely
| take 1-5 seconds from an end-to-end perspective depending on
| the processing speed of the originator, receiver and FedNow
| Service itself.
| 88913527 wrote:
| Couldn't having payments settle so quickly result in
| increased risk of overall system instability? I don't have
| a specific example, but I'm thinking of things like bank
| run panics. I'm sure this sort of thing would have been
| considered, however.
| Narkov wrote:
| You must remember, the US is very late to the "instant"
| payment party. This isn't a groundbreaking development.
| HoyaSaxa wrote:
| Yes, it absolutely does increase the overall system
| instability. However, that is at great benefit to the
| consumer. There are some safeguards in place in the
| actual FedNow Service, but it is primarily up to the
| Service Providers to give the financial institutions
| tools to manage risk. This includes features like
| liquidity management, circuit breakers, fraud/compliance
| monitoring, limits, etc.
| [deleted]
| beojan wrote:
| T + 1 millisecond seems impossible. Light can only travel a
| couple of hundred miles in a millisecond.
| ceejayoz wrote:
| Famously: http://web.mit.edu/jemorris/humor/500-miles
| mike_hock wrote:
| Expected the sendmail story, got the sendmail story.
| dheera wrote:
| So if you're both in NYC it should be fine. At the very
| least T + ping time + 1 ms
|
| And this should be available to customer investors (dudes
| at home) before retail investors (hedge funds)
| NavinF wrote:
| "retail investors" normally refers to individuals at home
| and T+2 doesn't affect them because they have margin
| accounts.
|
| The only limitation is that if you day trade, you'll need
| $25k in your margin account. If you don't day trade _or_
| you have $25k, you can withdraw $0.01 a few milliseconds
| after selling $0.01 in shares
| dheera wrote:
| Personally I use the word "retail" to refer to
| restaurants, stores, malls, and other soulless things
| that occupy commercial real estate.
|
| I use "customers" to refer to souls that occupy
| residential real estate.
| dbish wrote:
| You can use that, but there are pretty well understood
| terms in finance already (like retail investors), and
| probably best to use the standard if you want to be well
| understood.
| NavinF wrote:
| I find that obnoxious
| sclarisse wrote:
| Lewis Carroll wrote a gag about people using words like
| this.
| iknownothow wrote:
| The problem is, which "database"? If you know the data is
| always going to be in the range of ~1TB, use Postgres or some
| other ACID database. But I don't know of any petabyte scale
| ACID compliant database.
|
| Also I'm not sure if ACID is sufficient or not for banking
| systems.
| chaxor wrote:
| Any database easily handles terabytes, idk why that's a
| condition.
|
| DuckDB and SQLite easily handle terabytes of data. They're
| just not so much for cloud based apps, or things that need
| multiusers and access control junk. They're the best choice
| for just about everything else though.
| ZeroCool2u wrote:
| BigQuery is ACID compliant and easily handles petabytes.
|
| https://cloud.google.com/bigquery/docs/introduction
| ibains wrote:
| Yes, but in addition to being ACID compliant
| (serializable ANSI), you need to support a million
| transactions per second - it's not just about data size.
| moneywoes wrote:
| What's the cloud infra like?
| 89vision wrote:
| Nobody in their right mind is using BQ for oltp workloads
| Symmetry wrote:
| Was it difficult avoiding using an ESB? I've heard stories
| about how requirements to use those were listed as an example
| of an interoperable system in law and then ended up being
| mandated across DoD for everything.
| swader999 wrote:
| Is there a record of 'what' was bought or transacted for?
| hnburnsy wrote:
| FedNow Payment Flow diagram...
|
| https://www.frbservices.org/binaries/content/assets/crsocms/...
| umeshunni wrote:
| So, how do we use it?
| 2143 wrote:
| Funny thing about topics like this is that people of any given
| country is oblivious to how other countries have solved that
| problem, or the challenges other countries face, or inturn the
| problems that they themselves face.
|
| Regarding payment systems specifically, people generally don't
| realize what they're missing.
|
| Pick anybody from anywhere and they'll tell you they've been able
| to do everything they ever wanted to do (with regards to
| payments) using the already-existing systems of their country.
| WeylandYutani wrote:
| It's true that America is very far behind now but they're also
| the ones who started creditcards all the way back in the 1950s.
|
| Anyway I have a theory: big countries are too far up their own
| ass to notice or care what the rest of the world is up to.
|
| Compare a small, international oriented country like the
| Netherlands or Denmark to sleepy provincial Germany.
| TechBro8615 wrote:
| Sure, but in most countries, those services are provided by
| banks, not the government. There is certainly something to be
| said for legislation like open banking regulations that
| encourages/forces banks to facilitate instant peer to peer
| payments. But that's a far cry from a service offered directly
| from the government (okay, technically the fed isn't the
| government, but it may as well be).
| tiffanyh wrote:
| Sounds like a European view.
| lxgr wrote:
| Interbank payment systems are actually provided by central
| banks or the government (or affiliated organizations of
| either) in quite a few cases.
|
| Europe has TIPS (an ECB-operated implementation of the SEPA
| Instant Credit Transfer scheme), India has UPI (which is
| pretty close to the central bank, as far as I understand)
| etc.
|
| In the case of FedNow and TIPS, there are private
| alternatives as well, such as RTP in the US or EBA Clearing's
| SEPA Instant implementation in Europe. This is similar to ACH
| - there's both a public (FedACH) and a private (The Clearing
| House) implementation/network available.
| nordsieck wrote:
| OK.
|
| But it doesn't seem to me like there's a huge difference
| between "Know Your Customer" + FDIC and Fed Now aside from
| removing risk to consumers that most people ignore anyhow.
| TechBro8615 wrote:
| There's a big difference between checking passports before
| onboarding a customer, and sending every transaction to the
| federal government in real time.
| chimeracoder wrote:
| > There's a big difference between checking passports
| before onboarding a customer, and sending every
| transaction to the federal government in real time.
|
| I guess there's _technically_ a difference between
| "sending every transaction to the federal government in
| real-time" (FedNow) and "sending every transaction to the
| federal government, in batches three times per day" (the
| status quo).
|
| But from a privacy standpoint, the two are functionally
| identical.
| xp84 wrote:
| Can you clarify something? I thought FedNow was for
| settling up when I, as an ABC Credit Union customer,
| initiate a transfer of $5000 to you, a Chase customer.
| Now ABC needs to subtract it from my account, and if
| successful, tell the Fed to take money out of ABC's Fed
| account and put it into Chase's, and to tell Chase to
| expect $5000 (Transaction ID: XXXX?) and here's who it's
| for.
|
| Does FedNow, or whatever batch job it is replacing,
| involve ABC telling FedNow "This is for a transfer from
| Jane Doe (SSN 123-45-6789) to Joe Bloggs (SSN
| 098-76-5432)"? As I imagined it, FedNow would only _need_
| to know what bank is sending and what is receiving.
| lampiaio wrote:
| > in most countries, those services are provided by banks,
| not the government
|
| That's something I always point out when telling others how
| awesome the Brazilian Pix system
|
| https://en.wikipedia.org/wiki/Pix_(payment_system)
|
| is. It's not a private initiative by a bunch of individual
| banks, but rather a zero-fee payment system managed by the
| country's central bank:
| https://www.bcb.gov.br/en/financialstability/pixfaqen .
| 2143 wrote:
| This, ladies and gentlemen, illustrates the point I was
| trying to make.
| ksec wrote:
| Which is basically why all the De-Fi, Web 3.0, Cyrpto nonsense
| are very much US centric.
| earthboundkid wrote:
| When I lived in Japan twenty years ago, everybody just wired
| money electronically and checks were long obsolete. In the US,
| I write checks every week or so. They also had a system where
| you would put your checkbook into the teller machine and it
| would print your credits and debits into the book for you. It
| was very convenient. On the downside, the ATMs were turned off
| (!) during national holidays, so you had to get cash
| beforehand.
| lmm wrote:
| I don't think cheques are obsolete in Japan, so much as never
| having been popular and established in the first place. A lot
| of things are just done in cash (even e.g. buying houses!)
| and that's not seen as unacceptably risky the way it is in
| many countries; COD is an established practice that again
| just doesn't exist (and wouldn't remotely be considered safe)
| elsewhere. Furikomi is slow and expensive and cheques would
| actually be an upgrade in many ways.
| tombert wrote:
| I'm only nominally a grown-up, but I've lived in the US my
| entire life and I don't think I write a check more than once
| a year. Most stuff I buy is done with credit cards (which I
| generally pay with their respective mobile apps with bank
| transfers), my mortgage is automatically withdrawn from my
| checking account, and I use CashApp or Paypal to send money
| to people directly.
|
| I think the last time I actually wrote a physical check was
| when I refinanced my house in 2021.
| adventured wrote:
| > When I lived in Japan twenty years ago, everybody just
| wired money electronically and checks were long obsolete. In
| the US, I write checks every week or so.
|
| And yet in Japan they're still obsessed with using backwards
| fax machines and paper.
| jeffchien wrote:
| Checks never took off in Japan because their 1947 Labor
| Standards Act (Art. 24) actually made it illegal to pay wages
| by check [1]. So it's not that checks were made obsolete,
| it's that they were smothered in their crib. Until the advent
| of electronic payment, it's said that tens of millions still
| got paid in cash rather than bank transfer in the early 90s
| [2].
|
| I think it's easy to forget that societies that adopt a
| technology early might be doing so because the slightly
| outdated alternative from elsewhere was never brought over.
| Japan has no shortage of those, like a lot of dining is still
| cash only. Who knows, perhaps in 10 years those restaurants
| will skip credit cards and contactless and go straight to
| face-based automatic payment.
|
| [1] PDF warning https://www.ilo.org/dyn/travail/docs/2018/Lab
| or%20Standards%... [2] 1991 article https://www.sun-
| sentinel.com/1991/10/24/japanese-prefer-cold...
| zerocrates wrote:
| Surprised you're writing checks every week: I haven't written
| a check in years. ACH transfers, sure, but not physical
| checks.
|
| I do still _receive_ them occasionally, almost always as
| printed checks from companies.
| xp84 wrote:
| It depends. I have to use checks to pay my landscaper and
| housekeeper, because there isn't another unilateral payment
| document.
|
| By this I mean, in the US everyone _could_ use CashApp,
| Venmo, PayPal, Zelle (glorified ACH, right?), etc. for p2p
| payment. If you have the same bank, many banks have a
| trivial "send money to another customer's account"
| feature. However, to do so requires essentially a
| 'handshake' where the two parties agree on a method. Checks
| require no up-front handshake, since everyone knows what to
| do with a check (deposit it at your ATM, take a picture of
| it with mobile app, or take it to a check-cashing place or
| the issuing bank).
|
| If I could print on paper a key or QR code that allows you
| to claim the money into the account of your choice, like a
| check does, I'd use that. Sadly, banks seem to have put
| their effort into Zelle instead.
| mnahkies wrote:
| Aren't you just describing cash? Cheque has the same
| issue as the online alternatives in that it could
| "bounce" - cash (or I guess crypto) can't
| aidenn0 wrote:
| Large checks are cheaper to handle than an equivalent
| amount of cash. Most people won't just toss $10k in the
| back of their car and drive to the bank, but would think
| nothing of taking a $10k check to the bank.
|
| Also, there is less of a need for a receipt when paying
| by check. If I pay someone by check, my bank has a record
| of it. If I pay them by cash, I better get (and keep)
| that receipt in the case of a later non-payment dispute.
| ghaff wrote:
| Yeah. And with online banking apps, it's basically not
| worth anyone's time to do the handshake because
| depositing just isn't a big deal [ADDED: If there's an
| in-person transaction]. I use credit/debit/ACH 95%+ of
| the time but if that's not an option check is easy.
| Qworg wrote:
| Zelle may still allow for you to send money to a non-
| Zelle account - as a dark pattern, they'll hold that cash
| for the recipient and give them an opportunity to sign up
| and receive it. This was a big pressure point for smaller
| banks and CUs to sign up.
| TheNewsIsHere wrote:
| I run into this myself a whole lot with various home
| service businesses in particular.
|
| It's not unusual for me to get an invoice for a company via
| QuickBooks Online, with cash or check as the only payment
| options.
|
| Other businesses around here have started giving discounts
| for paying with cash or check versus apps or credit/debit
| cards, to avoid the recent increases in fees.
|
| I'll also write checks when having a "hard" traceable
| payment instrument physically makes sense for auditing
| purposes or fraud prevention, although that's less
| frequently needed.
| 2143 wrote:
| > They also had a system where you would put your checkbook
| into the teller machine and it would print your credits and
| debits into the book for you.
|
| That's intresting to know.
|
| Where I'm at, we had (still have?) a "passbook", a small
| booklet where you could get all your transactions printed
| onto.
|
| But AFAIK we couldn't do it ourselves through the teller
| machine though. Once in a few months or so you go to the
| respective bank and ask the staff there to update the
| passbook. They use a machine, however.
|
| Of course, there days it's unnecessary as you can
| electronically download a list of your transactions for a
| given period from the bank's website/app.
| notRobot wrote:
| I've seen (and actually even used once, I think) automatic
| passbook updating printer machines in quite a few ATMs in
| some places.
| seanalltogether wrote:
| > Pick anybody from anywhere and they'll tell you they've been
| able to do everything they ever wanted to do (with regards to
| payments) using the already-existing systems of their country.
|
| This is like comparing candles and lightbulbs. Sure you can
| light up your home using both methods just fine, but you end up
| realizing how inconvenient candles were once you've made the
| jump to the newer technology.
| tomcam wrote:
| Not my good friend from Tuvalu
| nodesocket wrote:
| Will banks be able to charge fees to their customers for using
| FedNow like wire transfers?
| toomuchtodo wrote:
| They could theoretically, but it is unlikely due to each
| transaction costing a few cents and the monthly FedNow fee
| being $25 (it is a utility run on a cost recovery basis). No
| banks charge for Zelle payments to my knowledge, for example.
|
| This eventually replaces checks, money orders, Zelle, Venmo,
| ACH, and probably credit card payment volume over time (as seen
| with UPI in India and PIX in Brazil). Every deposit account can
| send to other deposit accounts instantly.
| xxpor wrote:
| is the fee on a per bank or per account basis?
| toomuchtodo wrote:
| Per routing number, so effectively per bank.
|
| Edit: (throttled, can't reply) GSIPs (globally systemic
| important banks) like JPMC with multiple routing numbers
| are the exception, not the rule.
| nodesocket wrote:
| Typically banks have many routing numbers[1], but it
| seems like they grossly undercharging banks here. Should
| be like $500/mo per routing number, that's still chump
| change for banks.
|
| [1] https://www.gobankingrates.com/banking/banks/chase-
| routing-n...
| jaywalk wrote:
| Per bank. $25/month/account would be insane.
| Tommstein wrote:
| At a whole $25 per bank, why even bother charging
| anything?
| xxpor wrote:
| Yeah, that's why I asked. Either it's insanely expensive,
| or insanely cheap!
| staringback wrote:
| Given how generous credit card rewards are in the US,
| combined with the interest rates that get charged to people
| who buy things they can't afford, I don't see it replacing
| credit cards.
| DeRock wrote:
| You need to see it from the merchants perspective. What if
| they offered you a 5% discount for paying with FedNow?
| staringback wrote:
| 5% is still in the realm of cashback rewards, I use my
| Citi Custom Cash card to purchase gas and receive 5% back
| (it is cheaper this way even though the credit price is
| usually 10c higher per gallon)
| cdnsteve wrote:
| The beginning of the end is here. Social credit score will soon
| follow. Expiring money and control or limits of savings or what
| you can buy. This is not good.
| tjpnz wrote:
| I don't understand why FedNow and CBDC are such a big issue in
| the US. FedNow looks quite attractive from a fees perspective,
| especially when compared to PayPal and alike. Part of me wonders
| if the middlemen who stand to lose out might be trying to muddy
| the waters. It wouldn't be the first time.
| dboreham wrote:
| The same thing happens when a town decides to string fiber on
| their utility poles and sell transit. All sorts of reasons why
| that's a terrible thing. Same for importing drugs from other
| countries. And on and on.
| ke88y wrote:
| The ISP duopoly/monopoly is worse from a consumer perspective
| and functionally equivalent from a civil rights perspective.
| To think otherwise is naive.
|
| In fact, the private sector solution is perhaps even worse
| from a civil rights perspective.
|
| Consider a prosecutor in Jurisdiction A hell-bent on
| violating the civil rights of a citizen in Jurisdiction B,
| and suppose Jurisdiction B is sympathetic to this citizen.
| This isn't even hypothetical in the USA. Abortion,
| immigration, civil disobedience, etc. In the corporate
| duopoly setup, Jurisdiction A can compel the ISP to comply --
| either by physically entering the property of the ISP and
| taking data by force, or by threatening market access. In the
| muni ISP case, Jurisdiction B says "shove it".
|
| And that's before noting that corporations such as modern
| ISPs are -- like governments -- also large bureaucracies
| endowed with incredible power that are de facto impossible to
| opt out of. Except at least in representative government you
| have some sort of voice, however small, which isn't dependent
| on amassing vast sums of cash.
| rootusrootus wrote:
| > a town decides to string fiber on their utility poles and
| sell transit
|
| I dream of the day my municipality does this. The idea of
| buying service from whoever I want rather than be forced to
| use Comcast... -swoon-
| lbotos wrote:
| Because there are many Americans who are small gov and against
| excessive taxation. A CBDC is "too far" for a lot of people who
| believe that.
| bluescrn wrote:
| Imagine being paid in a 'programmable' currency that your
| employer (or government) decides cannot be spent on alcohol,
| meat, or fossil fuels.
|
| Meanwhile, wealthier people get paid in 'unrestricted'
| currency.
| Spivak wrote:
| I mean if we're talking that level of societal breakdown
| they would just use the system we already have for tracking
| semi-restricted purchases which is scanning and reporting
| your government ID.
|
| Then you can enforce meat and fossil fuel rations with no
| way to buy yourself around it.
| zirgs wrote:
| Payment processors like VISA can already block payments
| that they don't like. Even if they are completely legal.
| hrdwdmrbl wrote:
| A CBDC does not necessarily need to be implemented with
| that capability.
| bluescrn wrote:
| No, but big centralized power tends to crave ever more
| power, control, and surveillance
| candiddevmike wrote:
| That already exists today, food stamps/SNAP/EBT for low
| income and dollars for everyone else
|
| I'd just as soon give everyone dollars via UBI
| realce wrote:
| Your employer doesn't pay you in food stamps, they pay
| you in money you can use to buy anything you need in the
| entire world.
|
| The government provides coupons that allow you to buy
| food which is remediated to the seller in dollars. The
| authority and funding to provide that service is
| something that voters can impact or change.
|
| These are very different things, not "that already
| exists" at all.
| digging wrote:
| > they pay you in money you can use to buy anything you
| need in the entire world.
|
| This is an primarily American phenomenon though and it's
| only really true because of the dominance of the US and
| US petrodollars over global society. It's probably not
| easy to spend Turkish lira in Madagascar, for example.
| Yes there are banks which will exchange approved
| currencies, but that's one step removed from being paid
| in a global global currency as you imply.
| imtringued wrote:
| Honestly, if governments paid out all social benefits in
| a demurrage currency which they accept for tax payments,
| they would save a lot of money because the velocity and
| therefore fiscal multiplier of a demurrage currency is
| very high.
|
| Christian Gelleri made this proposal to solve the Greek
| crisis: https://papers.ssrn.com/sol3/papers.cfm?abstract_
| id=3144910
| maerF0x0 wrote:
| afaik food stamps/SNAP/EBT is a charitable thing though,
| right? ie, the recipients are not trading labor for it,
| right?
| treyd wrote:
| Why would they want to do that? How would either your
| employer or the fed have the _grounds_ to justify doing
| that?
| hellojesus wrote:
| Look at what happened with the Canadian protests and
| banking restrictions.
|
| Many are concerned that cdbc will allow the gov to create
| carbon rations that are enforced by disallowing
| purchases. Cash is fungible while regulated digital
| currency isn't.
| johnny22 wrote:
| it's what they do with foodstamps already, is the point.
| I don't know whether that'll atually happen, but that's
| the theory.
| bluescrn wrote:
| Something along the lines of 'We face a climate emergency
| that is even more serious than the Covid emergency, we
| have to do this, this is about saving lives'?
|
| (I'm not in any way a climate denier, just a huge
| pessimist when it comes to attempted solutions)
| ke88y wrote:
| I view this type of thinking as the conspiratorially
| minded's version of "trying to solve social problems with
| technical solutions".
|
| If there were political motive and will to implement such a
| system, it could be done without a CBDC and _certainly_
| without modernization of ACH (heh).
|
| Conversely, if there's not political motive and will, then
| the presence of a CBDC doesn't change that fact.
| Mistletoe wrote:
| You are already starting to pigeonhole people with your
| stereotype. I'm as liberal as they come and I find the
| thought of a CBDC to be an unimaginable Orwellian nightmare.
| A boot stamping on the face of civil liberties and privacy
| forever.
| chaostheory wrote:
| Supposedly, it's because of more centralized surveillance and
| control.
|
| https://medium.com/beyondmoney/the-good-bad-and-ugly-of-cbdc...
|
| https://medium.com/illumination/how-the-central-banks-digita...
| hitpointdrew wrote:
| > I don't understand why ~FedNow and CBDC~ BIG BROTHER are such
| a big issue in the US.
|
| Fixed this for you.
|
| I don't really want a gigantic federal agency having insight
| into every financial transaction I make. Hard, fucking, pass.
| itake wrote:
| Just wondering, but how is this different from our current
| system where judges can approve search warrants and companies
| have to comply?
|
| Are you think they won't need search warrants?
| hellojesus wrote:
| Cash isn't recordable in the same way. I don't provide my
| id with the transaction when making cash purchases.
| itake wrote:
| I don't think this service is replacing cash payments
| unless I am missing something?
| hellojesus wrote:
| You are correct. I was thinking cdbc not fednow.
| phpisthebest wrote:
| It is a step, a big one, to their "dream" of a "cashless
| society" that we have been on for decades.
| amflare wrote:
| This is the difference between the government needing a
| search warrant and having to come to your house, and them
| needing a search warrant but a law enforcement officer
| already living in your house. Sure, they still "need a
| warrant", but that doesn't make the situation acceptable.
| itake wrote:
| Do you think private unregulated businesses (CashApp,
| Venmo, etc.) that this is trying to replace are any
| better? These companies just sell your transaction data
| to the highest bidder, no warrant needed.
| Analemma_ wrote:
| Are you under the impression that ACH, the thing FedNow is
| replacing, is free from government influence?
|
| This is what's bizarre to me about the FedNow hysteria. It's
| not a government system replacing a private market system.
| It's a government system replacing an older, worse government
| system. It's like having a panic attack because the Federal
| Reserve is updating their PCs to from Windows XP to Windows
| 10.
| dylanlacom wrote:
| Because Nacha (and ACH) is explicitly not a government
| system
| PaulDavisThe1st wrote:
| ACH involves the Federal Reserve Bank in every transfer.
| FedNow involves the Federal Reserve Bank in every
| transfer.
| biesnecker wrote:
| To be fair only about half of US ACH traffic flows
| through the Fed (the other half goes through the Clearing
| House Payments Company), but the Fed is very much
| involved (and a critical component of) the ACH network,
| even if the system is not explicitly a government one.
| [deleted]
| [deleted]
| kelnos wrote:
| Ignoring the fact that FedNow doesn't change much in this
| regard...
|
| I'm torn on this. Visa, MasterCard, Venmo (aka PayPal), etc.
| all know about large subsets of my transactions, and they go
| and sell my personal data to other companies in sleazy ways
| to cover their costs.
|
| Is that better or worse than the government knowing all this
| stuff? Sure, the government can also legally use force
| against me and deprive me of my freedom and possessions, and
| might pervert my transaction history into justifying doing
| bad things to me. But that's a risk, not a certainty. Private
| companies selling my data and using it in nefarious ways is a
| certainty.
| chimeracoder wrote:
| > I don't really want a gigantic federal agency having
| insight into every financial transaction I make. Hard,
| fucking, pass.
|
| If that's the case, I have bad news for you about the banking
| system of literally every developed country.
| bboygravity wrote:
| Ever heard of cash?
|
| I can buy an icecream anywhere in the world without anybody
| tracking me. Even with the "wrong" political opinion (even
| if I would be a trucker in Canada during certain protests).
|
| I cannot do that with CBDC.
|
| No. CBDC (aka: the ultimate totalitarian's dream) is not
| the same as the current banking system, despite the current
| banking system also being very horrible for privacy.
|
| * All of the above assuming that cash will be banned and
| CBDC will be mandatory for everybody.
| kredd wrote:
| The reality is, supermajority (including me) of people
| prefer not using cash. Especially up here in the North.
|
| Can't even recall to ever pulling some out other than
| some casino entertainment night. I understand all the
| "freedom" (or whatever one might call it) I'm losing, but
| the positive sides are much better (never have to care
| about losing my wallet, much faster transactions,
| convenience and etc.). Sure, sounds bad on paper, but I
| haven't felt any negatives in 10+ years, especially when
| in practice makes my life easier.
| NamTaf wrote:
| That's a very load-bearing assumption.
| hellojesus wrote:
| Not as load bearing when you look at the legal limits of
| cash transactions in countries in Europe. Also not so
| load bearing when you consider the unconstitutional civil
| asset forfeiture of the current US.
| ke88y wrote:
| _> I can buy an icecream anywhere in the world without
| anybody tracking me._
|
| No you can't. Companies like OpenEye and Deep Sentinel
| offer facial recognition solutions that are targeted at
| loss-prevention, and these systems are commonplace in the
| USA. Facial recognition-based consumer analytics systems
| are also available.
|
| In fact, I think you'd be hard pressed to find a pint of
| ice cream that you can buy without having a camera
| pointed at your face. Even the little stand at the beach
| in the state park near my old place had a camera, and I
| didn't even have real LTE coverage there.
|
| Privacy comes only from the force of law; not the other
| way around.
|
| Anyways, the whole conversation is a red herring. This is
| a replacement for ACH, which already exists, and there
| isn't substantively more information sharing between
| banks and governments than already exists.
| amflare wrote:
| So because malicious parties can track us via other
| means, we should just allow them to start doing it (even
| more) through our financial history?
|
| Anyways, it's not (fully) about information sharing. It's
| about control. It's the difference between read access
| and read/write access.
| ke88y wrote:
| FedNow doesn't allow any more or less tracking than
| what's already possible through the Fed's visibility into
| ACH. So for the purposes of FedNow the entire
| conversation is off-topic.
|
| Anyways, you missed the point.
|
| The anti-new-technology and anti-gov-technology response
| to privacy and control is misguided. Corporations will
| fuck you, left unchecked, and governments will fuck you
| through corporations. There is no technical solution to
| political problems, and physical cash vs FedNow vs
| digital currency is a suite of technical solutions.
|
| Trying to solve a political problem by eliminating
| technology is literally the same thing as trying to solve
| political problems with technology. The fallacy is in
| focusing on technology where the actual problem is
| political.
|
| The problem is political and needs to be treated as such.
| The solution is building and maintaining political
| consensus in favor of strong privacy and personal
| property rights, not carrying around a billfold full of
| physical cash.
| danielmarkbruce wrote:
| FedNow isn't a big issue.
|
| CBDC really isn't a big issue either, because it almost
| certainly won't happen. Americans are very unlikely to want a
| system like that.
| atentaten wrote:
| Americans didn't want a central bank, but look at where we
| are.
|
| https://www.cambridge.org/core/journals/perspectives-on-
| poli...
| danielmarkbruce wrote:
| The "central bank" americans fought hard against in the
| first place didn't have the same function as the modern
| central bank started last century.
| CameronNemo wrote:
| Two points of context:
|
| * the Biden administration is planning to monitor smaller
| denomination transactions (in an inflationary environment!)
|
| * IRS resources historically and presently target low-income,
| low-wealth households/individuals for audits
|
| https://www.cnbc.com/select/irs-600-reporting-rule-delayed/
|
| https://www.cbsnews.com/news/irs-audit-eitc-five-times-as-li...
| PaulDavisThe1st wrote:
| IRS auditing targeting has been at the explicit behest of
| Republican controlled Congresses. That is, they were told to
| stop/reduce targetting high net worth individuals, or face
| even further cuts to their budget.
| jonhohle wrote:
| What benefit would targeting low wealth individuals have to
| the IRS? I worked on a state tax system briefly at Accenture
| and they offered the product for a percentage of reclaimed
| taxes. They started with high debts with good credit scores.
| Since they had skin in the game (which it could be argued the
| IRS doesn't), they wanted to maximize the unpaid taxes they
| collected.
| CameronNemo wrote:
| Tax collectors have traditionally extracted from low wealth
| individuals to enrich wealthy individuals.
|
| I'll let you figure out why.
| PaulDavisThe1st wrote:
| > What benefit would targeting low wealth individuals have
| to the IRS?
|
| Wrong question. The correct question is:
|
| What benefit would the IRS targetting low wealth
| individuals have to high wealth individuals?
| genmud wrote:
| Because wealthier people have more complicated returns and
| are much more likely to litigate, resulting in more time
| commitment.
|
| For high net wealth audits, you could have potentially
| dozens of people working on it for years so there is a
| _possibility_ that a judge / jury rules in your favor.
|
| They are going after low effort people, but making it up by
| volume.
| DANmode wrote:
| > What benefit would targeting low wealth individuals have
| to the IRS?
|
| I'll shorten the explanation even further: many more
| easy/no contest wins.
| digging wrote:
| > IRS resources historically and presently target low-income,
| low-wealth households/individuals for audits
|
| If we could actually increase their funding substantially,
| this would be less true, but it's difficult and expensive to
| go after wealthy individuals.
| skizm wrote:
| How does this system impact the normal person? Like who is the
| customer for this? Can I uninstall Venmo and Paypal? Or is this
| something banks would use under the hood and consumers would
| never interact with?
|
| e: ah I see the diagram now. more helpful.
| [deleted]
| mydriasis wrote:
| > Banks and credit unions of all sizes can sign up and use this
| tool to instantly transfer money for their customers, any time of
| the day, on any day of the year.
|
| Whoa. Is this as awesome as it sounds? Is this akin to
| government-backed Venmo, or something?
| lisper wrote:
| > Is this akin to government-backed Venmo, or something?
|
| Yes, exactly. But you have to keep in mind that this is a two-
| edged sword. On the one hand, it's going to be convenient and
| probably secure. On the other hand, it's going to let the
| government see every transaction you make, which for some
| people will be a very high price to pay.
| s3p wrote:
| Ok but.. ACH
| cameldrv wrote:
| I don't see how this is much different than the current
| situation. The Fed already processes ACH transactions
| (basically all bill-pay, most transfers to/from Paypal/Venmo
| etc), and all wire transfers (most high dollar money
| transfers)
| lisper wrote:
| The new system is faster.
| iudqnolq wrote:
| > On the other hand, it's going to let the government see
| every transaction you make
|
| Can you go into more detail here on what you think will
| change from the status quo? Existing bank transfers are
| obviously not secret from the government on request. While
| the government doesn't have direct access to run search
| heuristics on the whole dataset they just delegate that to
| the banks' internal compliance team.
| lisper wrote:
| The magnitude of the change is somewhat in the eye of the
| beholder. On the one hand, the government already has a lot
| of visibility into your finances. On the other hand, this
| removes some friction that currently exists for certain
| kinds of transactions. This matters more to some people
| than others. There is also concern that this might be a
| step towards the eventual elimination of cash.
| iudqnolq wrote:
| I find it annoying that we have these endless debates in
| the US where it's assumed that if there's some magnitude
| it of course must be more than epsilon.
|
| I would be interested in if anyone can give a example
| where the friction increases in such a way as a person
| would experience an actual difference, or how this would
| actually make cash easier.
|
| Otherwise this sounds to me like the endless silly
| arguments against a national id card by people. (State ID
| cards that then go into a federal database are no more
| private but come with annoying downsides like ID.me)
| didntcheck wrote:
| I wrote a comment on another thread today about this wrt
| surveillance. Reduced friction in surveillance definitely
| is something to be feared, as the evidence is that if the
| government/police/alphabet agencies _can_ use a power
| (literally, not necessarily legally), they will. The only
| thing holding them back in the pre-digital age was the
| high cost of physical surveillance and even data storage,
| when "files" were things you held. The difference in
| quantity of possible surveillance has become a difference
| in quality, where it's just "common sense" that the
| government can easily pull your movements from cell tower
| records, and that they'll do so regardless of whether
| they're allowed to (or say "terrorism!" allows them to)
| EgregiousCube wrote:
| It lowers the cost of the government performing wide
| surveillance of financial activity; the fear is that
| lowering this cost will enable more advanced forms of
| detection and enforcement that ultimately look and feel
| like harassment.
| carlosjobim wrote:
| Automated surveillance and automated interference. If you
| think YouTube's algorithms for determining copyright or
| Facebooks algorithms for "community standards" are bad,
| wait until you have your bank account locked and can't buy
| food.
| caseysoftware wrote:
| If the government wants to tax these transactions - and
| let's admit it, they do - they'll take it right off the
| top. Unlike with the banking system where different banks
| have different prices for wires - or even free under
| certain conditions - you can't "shop around" for a new
| government.
|
| Further, if a government determines you are not an
| "acceptable" participant, they have the ability to stop
| transactions to/from you.
|
| *Ability doesn't necessarily translate to authority - you
| can probably fight it - but the government's legal fees are
| paid by us so they're effectively unlimited.
| xcrjm wrote:
| It won't be any worse or better than existing federally
| administered systems. The government already oversees all
| the major existing bank-to-bank transfer systems
| mentioned in the press release. In the US banks charge
| different wire fees because they can as a competitive
| matter, but they all use FedWire to talk to each other.
| Just like they can impose arbitrary limits on ACH
| transfer size but they all use FedACH to handle the
| actual transfer. This one is just a faster, more secure
| version of the latter.
| iudqnolq wrote:
| > If the government wants to tax these transactions - and
| let's admit it, they do - they'll take it right off the
| top.
|
| If the federal government wants to tax things they indeed
| can. But I was asking about a chance from the status quo.
|
| If you owe the US government money right now they can
| take it out of your bank account.
|
| > Unlike with the banking system where different banks
| have different prices for wires - or even free under
| certain conditions - you can't "shop around" for a new
| government.
|
| You can shop around for a different bank but it will
| still follow US law and also go above and beyond to help
| out the feds.
|
| > Further, if a government determines you are not an
| "acceptable" participant, they have the ability to stop
| transactions to/from you.
|
| Yes, but this already exists.
| https://ofac.treasury.gov/specially-designated-nationals-
| and...
|
| > *Ability doesn't necessarily translate to authority -
| you can probably fight it - but the government's legal
| fees are paid by us so they're effectively unlimited.
|
| Yes but your legal remedies might actually be better
| under FedWire. US fourth amendment law has a massive
| loophole whereby if a private business "voluntarily"
| assists the government it doesn't count as a search. So
| if the government searches your government bank account
| you'll have potentially better remedies than if they ask
| your private bank to pretty please send a printout. (and
| there's very little chance your current bank tells the
| feds to shove off and come back with a warrant in that
| kind of situation)
| jonhohle wrote:
| If the government could stop cash transactions entire
| classes of crime would be significantly more impractical
| (while at the same time significantly invading the
| privacy of all citizens).
| id0ntw4ntit wrote:
| Can't stop cash, cash is a fact.
| PaulDavisThe1st wrote:
| > If the government wants to tax these transactions - and
| let's admit it, they do - they'll take it right off the
| top.
|
| They have no authority to do this unless you're subject
| to a tax witholding order. The government cannot collect
| taxes on arbitrary transactions as they occur - it can
| levy taxes, and then attempt to collect them (it hopes
| via voluntary payment by taxpayers).
|
| You, like so many other commenters here, seem to fail to
| grasp that FedNow is a replacement for ACH, the existing
| inter-bank exchange system that already involves the
| Federal Reserve to precisely the same extent that ACH
| already does.
| chimeracoder wrote:
| > If the government wants to tax these transactions - and
| let's admit it, they do - they'll take it right off the
| top.
|
| The Federal Reserve isn't the government. Yes, if they
| want to charge a fee for this service, they could. The
| same is true of every existing money-moving mechanism.
|
| > Unlike with the banking system where different banks
| have different prices for wires - or even free under
| certain conditions - you can't "shop around" for a new
| government
|
| FedNow is essentially free[0]. If FedNow imposes a higher
| fee in the future, you can always choose to use other
| services (ACH, wire payments, etc.). It's a competitive
| market.
|
| > Further, if a government determines you are not an
| "acceptable" participant, they have the ability to stop
| transactions to/from you.
|
| This power already exists. FedNow doesn't change it one
| way or the other.
|
| [0] https://www.frbservices.org/news/press-
| releases/012722-fedno...
| mixmastamyk wrote:
| Govt can already see any bank transaction made as it chooses
| already.
|
| Question is, why does this fact get brought up everytime as
| if it's novel?
| delfinom wrote:
| The government can already see all your ACH transactions like
| payroll, rent, etc because the Fed Reserve literally runs
| ACH. This also isn't replacing credit cards or the like, so
| it is basically an ACH replacement.
|
| That's on top of reporting requirements banks already have
| for your transactions.
| jsmith45 wrote:
| The Fed only runs FedACH, which is one of two ACH networks
| running the same protocol. The other is The Clearing House
| Payments Company's Electronic Payments Network. Indeed
| there used to be more private network operators, but the
| other two eventually folded, leaving just these two
| remaining.
| mlsu wrote:
| Put the flag of North Korea into the notes of a venmo
| transaction. You will very quickly find out the extent to
| which the government knows what you are doing with your
| money.
| imilk wrote:
| That's just not true and conspiracy nonsense.
| booleandilemma wrote:
| Maybe not that specific example, but it's very true
| generally. You can get your account blocked for specific
| words in your Venmo payments:
|
| https://www.inc.com/tess-townsend/venmo-reportedly-
| blocking-...
|
| https://angelinatravels.boardingarea.com/2017/05/04/caref
| ul-...
|
| I tested one of these and had to send Venmo customer
| support an email explaining I was not a terrorist.
| yieldcrv wrote:
| which once again has nothing to do eith the government
| and everything to do with Venmo incorporated (Paypal
| Inc.)
| yieldcrv wrote:
| Thats actually a private corporation having an excessively
| skittish _interpretation_ of federal regulations.
|
| The government would still need to go out of their way to
| know about that transaction. And the liability would only
| come after you or the organization got in trouble for
| something else.
| seydor wrote:
| paypal , visa and the like have proven to be worse than most
| governments
| rvz wrote:
| > Whoa. Is this as awesome as it sounds?
|
| No. A possible CBDC rails in the US is nothing to get excited
| about. Unless you want savings limits and expiry dates on your
| money.
|
| > Is this akin to government-backed Venmo, or something?
|
| Yes, but even worse.
| imtringued wrote:
| >Unless you want savings limits and expiry dates on your
| money.
|
| I don't believe in saving limits or expiry dates in the sense
| of losing 100% of your money. But think about what impact
| limiting savings has on debt. In aggregate, there can only be
| as much debt as there are savings. This means if you want to
| limit debt in the economy, you are going to have to limit
| savings as well.
|
| This is particularly relevant with debt brakes. A country
| with a debt brake but without a savings brake is going to run
| into a pretty fundamental limitation.
|
| Savers can delay their spending decisions and this ultimately
| delays the ability to repay debts but since debtor's are at
| the mercy of lenders, we blame the debtor for the lenders
| tardiness.
| nimbleplum40 wrote:
| Savings and debt in an economy are related, but not 1:1.
| See the money multiplier [1].
|
| [1] https://en.m.wikipedia.org/wiki/Money_multiplier
| samstave wrote:
| [flagged]
| pertymcpert wrote:
| [flagged]
| tarsinge wrote:
| This is not something revolutionary, multiple countries already
| have instant payment:
| https://en.wikipedia.org/wiki/Instant_payment. This is just a
| technical improvement on existing systems. Regarding your
| questions the FED is simply providing a facility
| (https://en.wikipedia.org/wiki/Clearing_house_(finance)) that
| willing participants (the list of early adopters is in the
| article) can use.
| whockey wrote:
| Founder of a developer bank, Column N.A. here. If people are
| interested in starting to build on FedNow hit us up.
| column.com/fednow and my email is william at column dot com .
| openthc wrote:
| Do you support cannabis business? Or rather, those of us who
| provide services too cannabis businesses? Some folk (eg:
| Stripe, Twilio) frown on even using their platforms for things
| next-to (but not touching) cannabis.
| mikewarot wrote:
| Does this eliminate the late night flights of Mitsubishi MU2
| turboprop cargo planes delivering canceled checks for the Federal
| Reserve?
| tjohns wrote:
| I thought Check 21 (enacted back in 2003) was supposed to
| eliminate that, allowing digital check images to substitute for
| physical copies during the clearing process. My understanding
| was banks (or even sometimes merchants) just scan in the paper
| checks on receipt these days and process everything
| electronically.
|
| https://en.wikipedia.org/wiki/Check_21_Act
| ncann wrote:
| Is this equivalent to Interact eTransfer in Canada?
| heydenberk wrote:
| Powell has mentioned[0] that the Fed is unable to affect fiscal
| policy, which is the fastest and best solution to certain
| economic crises. Does this bring the Fed closer to being able to
| simply give people money?
|
| [0] https://rollcall.com/2020/06/16/feds-powell-urges-
| congress-t...
| curiouselephant wrote:
| Just in time before they layoff 5% of the staff.
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