I send money across borders to friends an organizations via blockchain. And millions of other people do, especially in countries with volatile financial systems. I much prefer crypto to anything else in this case. Hearing "no legitimate use case" arguments is awfully annoying when you get objective use from the thing being criticized.
Your use-case is breaking money transfer laws. Just like every other use-case, it is far less expensive to break money transfer laws with a centralized ledger. When you make blockchain money transfer comply with regulations, it becomes more expensive than legal money transfer using centralized ledger.
When regulation kicks in (and it will — no government wants its citizens to be fleeced by rogue nations like DPRK and Russia), are there really any legitimate use-cases?
You're assuming it breaks laws, but it doesn't have to, it just makes it easier to do something that's painful to do either by design or due to shitty economic circumstances. In some countries banks pop-up and fold a dime a dozen week to week. Does that mean someone shouldn't be able to send funds to their relatives in a fucked up country?
> You're assuming it breaks laws, but it doesn't have to, it just makes it easier to do something that's painful to do either by design or due to shitty economic circumstances
Even if your sending end is regulated, at the other end, there has to be a regulated bank. If not, the person who is receiving the "money" could be breaking their country's laws. Cryptocurrencies don't magically change that. Otherwise, PayPal or Venmo could allow accounts to be created for those people in US dollars and do the job even more inexpensively.
The same regulations that mean you can't cheaply Venmo the person on the other end instead. If Venmo has to follow the law, cryptocurrencies have to follow the law as well. Being your own bank makes you liable to the same regulatory penalties that Venmo has to worry about.
Yes. You'd be a fool to invest. You'd be a fool to think cryptocurrency is useful too, but cryptoscammers and cryptofools haven't hit saturation of the greater fool market yet.
Edit: It appears Strike is attempting to comply with regulations, allowing transfers only to regulated partner banks in a few countries. They bake fees into the exchange rate to account for local exchange rate volatility on both ends and try to lower fees by investing customer deposits in the usual crypto ponzis. If that doesn't sink the company, penalties for facilitating scams will.
> Why not? Having open source protocols that compete with PayPal and VISA and aren’t funded and controlled by central states can be a positive thing
Sure. That isn't what crypto has become. After ten years, it's fair to call it given the amount of fraud, dishonesty and resource misallocation. Again, not saying ban it. Just tax it, regulate it closely, and keep an eye on the folks doing it to make sure they're focussing on doing it abroad.
It’s all relative. The tech is still in its infancy, perhaps like AI was a few decades ago. The current landscape of PoS, applied ZKP, rollup sequencers, stablecoins, and smart contracts are all significant improvements on what existed 10 years ago, and much more practical.
> current landscape of PoS, applied ZKP, rollup sequencers, stablecoins, and smart contracts are all significant improvements on what existed 10 years ago, and much more practical.
To what practical end?
I think exploration should continue. But in the academic, not product, space. Crypto has the potential to be toxic. Licensing regimes for potentially-toxic products is highly precedented.
Not to be rude but you obviously don't follow any of the technology so why even comment on it?
Huge advancements in zero knowledge cryptography have been made in the last year. Ethereum activated Proof of Stake in September. New DeFi primitives are released regularly.
It's actually hard to keep up with all of the research and releases which is why your comment is so perplexing unless it was made in bad faith.
Ethereum move to the Point of Sale ahem, to the PoS was simply late. It's not a new invention an is years old by now. DerangedFinance is only interesting for speculators and scammers. Without CEX on-ramps there is nothing interesting or useful in DeFi for a common people. It is only interesting to observe from the outside, how yet another bridge has been "hacked" due to the poor code, or how another person had been destroyed with slippage due to shitty UI of all token software, etc.
What people mean here is that general innovation is dead in token industry, finding a new niches, new industries. All attempts have dies in 2018 or so. Decentralized storage, decentralized compute (with blockchain), decentralized LoRaWan, decentralized identities, decentralized off-chain ownership and so on and so forth. All failed spectacularly.
The only innovation remaining is simply more advanced instruments for scammers and illegal finance operations. That is innovation, but not particularly interesting for mass market.
None of this stuff actually matters though. The main use case for crypto is speculation, store of value, and money-sending, and that's been working from the very beginning.
> Better phrasing would be niche legitimate use cases not worth supporting, at least not domestically, if you’re America, the EU, China, India or Japan.
Strong emphasis on "domestically". If you want to send money from one of those entities to another one, it gets hairy quite fast. I remember a time before SEPA and it was horrifying.
You can still have horrifying experiences with SEPA today. A German company once required that I send them CHF to their German IBAN. Which breaks several of the conditions for smooth SEPA transactions. IIRC for something like 30 Euro in value I had to pay 10 Euro in fees.
Wordwide is also problematic. If you can PayPal helps, but PayPal is its own hell, as many shop owners know. Credit Cards work but I can't send money via CC to a friend on the other side of the world, or can I?
I don't think Bitcoin or crypto is it but it would really be beneficial if we had some kind of money that is a first class citizen of the internet.
Depends on the sending and receiving country, and what the relationship is between the two banks, and what the amount is being transferred.
A lot of people have a limited set of experiences, such as sending wires or Wise payments to/from a specific country, and it works well for them, without realizing there is an entire world of other scenarios outside of this scope where it is not as well suited.
bank --> CEX (binance) --> bank (or OTC with a trading desk)
binance has about 10-20 basis points fees
how much did you pay using tradfi? not just fees but the forex spread
Choose almost any two countries in the world that don’t share the same union. eg: From GBP to CAD with Wise, transfer cost is > $5 (sometimes much more) and takes multiple days; compare with USDC on a rollup which is near-instant and < $0.50 regardless of the transaction amount.
My numbers are sourced from Wise’s own website. 1K GBP to CAD has a £5.02 fee and takes two days.
> How does crypto handle fraud?
Not every transactional system needs to adhere to the same set of antiquated and arduous AML checks and balances; which often break (either by allowing fraud to occur or incorrectly flagging and delaying valid transactions). For comparison, Cash App has no dispute mechanism:
I think the logical flaw is in the assumption that AML checks are a bug in traditional money transfer systems when in fact they are a government-imposed feature (largely following on from September 11 and the expanded scope of the FATF[1]). Therefore the same rules will eventually apply to cryptocurrency financial transactions negating many of the advantages that an unregulated process has when compared to a regulated one.
So the real question is: what is the technological benefit offered by decentralized ledger-type technologies versus traditional ones? The answer for many is that the technology is much worse in fundamental ways. Additionally the governance issues of a decentralized system or organization are very challenging to address.
It’s not technically possible for a single controller (the government) to censor and prevent transactions on an individual level across the network. In other words, the antiquated AML system we use for bank transfers cannot be strapped onto crypto ad-hoc. This is either a good thing, or a bad thing, depending on who you are asking.
As to your fundamental question, the above might already hint at it: decentralization. It’s an open source spec; shared and unified across the globe, that is not in the control of any one state government or private company. Other features like near-instant settlement times, programmability, 100% uptime, privacy (ZKP), permissionless usage, minimal transaction fees (L2)—these are all practical bonuses that do improve on the status quo in today’s payment processors.
Link, please? I ask because I have used Wise multiple times over many years and haven't had a transaction take more than 5 minutes. I'm confident I'm not the exception.
Cash App is US only and thus doesn't apply to your initial comment. Let's stay on topic please. Thank you.
Go to Wise.com and input the currencies in the transfer box.
Reiterating what I wrote in another comment, since you seem to be viewing this solely from your own experience:
> A lot of people have a limited set of experiences, such as sending wires or Wise payments to/from a specific country, and it works well for them, without realizing there is an entire world of other scenarios outside of this scope where it is not as well suited.
And Cash App is just an example; people are happy to send money with it, despite the lack of dispute and reversibility. Many people have friends and family across the world now and would probably be fine sending money to them without strict, slow, and costly AML checks on every transaction.
And how do you get the money out. At the end of the days there's a magic internet money to real money transaction and that will get hit with KYC and suddenly the entire house of cards collapses.
Or you never get the money out, but suddenly have a bunch of stuff and you get hit with taxes you can't pay because you didn't take the money out.
Countries aren't just going to let people evade AML because it finances stuff much worse than Johnny buying weed from a guy in Mexico, it finances terrorism and it's infinitely easier to follow the money than anything else.
Anything that gets big will get sued to hell and it's ridiculous to think otherwise.
Exchanges can see the assets I move through on-ramps and off-ramps, but (in the case of Zcash etc) they can't see all the on-chain activity in between, which is generally the more interesting part.
It has similar privacy properties as cash, so I would think governments would treat it similarly, with some reporting requirements depending on the amount.
If they do outright ban transaction privacy, at least that would involve explicit legislation with some risk of backlash - seems preferable to the status quo where the privacy violations are more covert.
