Digital coins may be on the verge of going mainstream(nytimes.com)
nytimes.com
Digital coins may be on the verge of going mainstream
https://www.nytimes.com/2017/08/03/style/what-is-cryptocurrency.html
236 comments
But with Google your Mom can find out when the store is open and where it is. Facebook lets grandparents see photos of grandchildren. Reading a blog replaces reading the gossip column in the daily paper. You could finally buy plane tickets without driving somewhere.
And so on. The early web was really fucking useful as it started to mature. It solved a lot of real problems.
What is cryptocurrency going to help these people do that they can't do already today?
And so on. The early web was really fucking useful as it started to mature. It solved a lot of real problems.
What is cryptocurrency going to help these people do that they can't do already today?
"What is cryptocurrency going to help these people do that they can't do already today?"
International payments confirmed and spendable in minutes not days. Escaping inflation in Venezuela/Argentina/whoeverisnext. Sending remittance to family overseas without 10% wasted in fees. Receiving monetary donations for organizations that might be victim of oppressive censorship. Participating in modern e-commerce for the unbanked/underbanked. Allowing merchants to save 2% in credit card fees (which doubles their profit margin if it was 2% to begin with). Allowing merchants to sell in industries prone to credit card fraud. Etc.
Gosh it's so easy to find many benefits in cryptocurrencies.
International payments confirmed and spendable in minutes not days. Escaping inflation in Venezuela/Argentina/whoeverisnext. Sending remittance to family overseas without 10% wasted in fees. Receiving monetary donations for organizations that might be victim of oppressive censorship. Participating in modern e-commerce for the unbanked/underbanked. Allowing merchants to save 2% in credit card fees (which doubles their profit margin if it was 2% to begin with). Allowing merchants to sell in industries prone to credit card fraud. Etc.
Gosh it's so easy to find many benefits in cryptocurrencies.
> International payments
When was the last time you made an international payment? I never made a payment outside of the EU and inside the EU I already have free wire transfers. For most people this is not interesting.
> unbanked/underbanked
You have the right to a bank account in the EU.
> Allowing merchants to save 2% in credit card fees
Currently Bitcoin is more expensive for typical transactions. And there's direct debit which is practically free at least here in Germany.
When was the last time you made an international payment? I never made a payment outside of the EU and inside the EU I already have free wire transfers. For most people this is not interesting.
> unbanked/underbanked
You have the right to a bank account in the EU.
> Allowing merchants to save 2% in credit card fees
Currently Bitcoin is more expensive for typical transactions. And there's direct debit which is practically free at least here in Germany.
"When was the last time you made an international payment?"
I love that you asked this question! The very reason it doesn't happen often is because of friction inherent to legacy payment systems. Cryptocurrencies remove this friction in cross-border trade, hence are making such transactions more commonplace.
It's like you saying in 1890 "Why buy cars? People don't travel that much." But the invention of cars is precisely what increased the desire to travel.
"You have the right to a bank account in the EU"
What about the rest of the world? 6.6B humans?
"Currently Bitcoin is more expensive"
Not for transactions above approximately $100.
I love that you asked this question! The very reason it doesn't happen often is because of friction inherent to legacy payment systems. Cryptocurrencies remove this friction in cross-border trade, hence are making such transactions more commonplace.
It's like you saying in 1890 "Why buy cars? People don't travel that much." But the invention of cars is precisely what increased the desire to travel.
"You have the right to a bank account in the EU"
What about the rest of the world? 6.6B humans?
"Currently Bitcoin is more expensive"
Not for transactions above approximately $100.
>I love that you asked this question! The very reason it doesn't happen often is because of friction inherent to legacy payment systems. Cryptocurrencies remove this friction in cross-border trade, hence are making such transactions more commonplace. It's like you saying in 1890 "Why buy cars? People don't travel that much." But the invention of cars is precisely what increased the desire to travel.
This argument presupposes what it tries to prove: the utility of cryptocurrencies.
There's no argument in there on why, if it was trivially possible due to cryptocurrency, the desire/need for international payments would increase.
This argument presupposes what it tries to prove: the utility of cryptocurrencies.
There's no argument in there on why, if it was trivially possible due to cryptocurrency, the desire/need for international payments would increase.
> What about the rest of the world? 6.6B humans?
“Banking the unbanked” is much discussed in international development circles. Around 2013, Bitcoin advocates started claiming that Bitcoin could help with this problem. Unfortunately:
* The actual problems that leave people unbanked are the bank being too far away, or bureaucratic barriers to setting up an account when you get there.
* Unless they use an exchange (which would functionally be a bank), they’d need an expensive computer and a reliable Internet connection to hold and update 120 gigabytes of blockchain.
* Bitcoin is way too volatile to be a reliable store of value.
* How do they convert it into local money they can spend? Pretty much nobody accepts bitcoin.
* 7 transactions per second worldwide total means Bitcoin couldn’t cope with just the banked, let alone the unbanked as well.
* A centralised service similar to M-Pesa (a very popular Kenyan money transfer and finance service for mobile phones) might work, but M-Pesa exists, works and is trusted by its users – and goes a long way toward solving the problems with access to banking that Bitcoin claims to.
Advocates will nevertheless say “but what about the unbanked?” as if Bitcoin is an obvious slam-dunk answer to the problem and nothing else needs to be said. But no viable mechanism to achieve this has ever been put forward.
“Banking the unbanked” is much discussed in international development circles. Around 2013, Bitcoin advocates started claiming that Bitcoin could help with this problem. Unfortunately:
* The actual problems that leave people unbanked are the bank being too far away, or bureaucratic barriers to setting up an account when you get there.
* Unless they use an exchange (which would functionally be a bank), they’d need an expensive computer and a reliable Internet connection to hold and update 120 gigabytes of blockchain.
* Bitcoin is way too volatile to be a reliable store of value.
* How do they convert it into local money they can spend? Pretty much nobody accepts bitcoin.
* 7 transactions per second worldwide total means Bitcoin couldn’t cope with just the banked, let alone the unbanked as well.
* A centralised service similar to M-Pesa (a very popular Kenyan money transfer and finance service for mobile phones) might work, but M-Pesa exists, works and is trusted by its users – and goes a long way toward solving the problems with access to banking that Bitcoin claims to.
Advocates will nevertheless say “but what about the unbanked?” as if Bitcoin is an obvious slam-dunk answer to the problem and nothing else needs to be said. But no viable mechanism to achieve this has ever been put forward.
A few things:
Bitcoin, being electronic, precisely helps with people being far away from bank branch offices.
Bitcoin SPV wallets run on $10 Android smartphones. No need for an "expensive computer".
"Bitcoin is way too volatile to be a reliable store of value" Still better than being unbanked/underbanked. Also, volatility has been decreasing: https://mobile.twitter.com/lsukernik/status/8649208737189519...
"How do they convert it into local money they can spend? " As Bitcoin adoption increases, there is less and less need to convert it. Today 160k+ merchants accept it. 8 years ago it was 0.
"* 7 transactions per second worldwide total means Bitcoin couldn’t cope with...*" This limit is obviously not set in stone and will increase one way or another: segwit, block size increase, payment channels, etc.
Bitcoin, being electronic, precisely helps with people being far away from bank branch offices.
Bitcoin SPV wallets run on $10 Android smartphones. No need for an "expensive computer".
"Bitcoin is way too volatile to be a reliable store of value" Still better than being unbanked/underbanked. Also, volatility has been decreasing: https://mobile.twitter.com/lsukernik/status/8649208737189519...
"How do they convert it into local money they can spend? " As Bitcoin adoption increases, there is less and less need to convert it. Today 160k+ merchants accept it. 8 years ago it was 0.
"* 7 transactions per second worldwide total means Bitcoin couldn’t cope with...*" This limit is obviously not set in stone and will increase one way or another: segwit, block size increase, payment channels, etc.
> Unless they use an exchange (which would functionally be a bank), they’d need an expensive computer and a reliable Internet connection to hold and update 120 gigabytes of blockchain.
Some of your points are well thought out, but I couldn't leave this one alone.
The vast majority of bitcoin users don't use a bitcoin exchange to store their coins. They also don't download the entire blockchain.
SPV wallets exist (like electrum or the android bitcoin wallet) that give the user complete control over their private keys without needing a copy of the blockchain or using substantial bandwith.
https://en.bitcoin.it/wiki/Electrum
https://en.wikipedia.org/wiki/Bitcoin_network#Payment_verifi...
Some of your points are well thought out, but I couldn't leave this one alone.
The vast majority of bitcoin users don't use a bitcoin exchange to store their coins. They also don't download the entire blockchain.
SPV wallets exist (like electrum or the android bitcoin wallet) that give the user complete control over their private keys without needing a copy of the blockchain or using substantial bandwith.
https://en.bitcoin.it/wiki/Electrum
https://en.wikipedia.org/wiki/Bitcoin_network#Payment_verifi...
> The vast majority of bitcoin users don't use a bitcoin exchange to store their coins. They also don't download the entire blockchain.
I couldn't find numbers on this when I went looking, but that's a numerical claim. Do you have numbers on this?
I couldn't find numbers on this when I went looking, but that's a numerical claim. Do you have numbers on this?
Thanks for being curious. I scraped around to find some numbers to back up my wild claim--I think I did a fairly decent job of it. I do warn you--my numbers are pretty rough.
Blockchain.info claims to be the most popular web wallet with 10M users and users have control of their own keys without needing to run a node. Their android app has 1-5M downloads.
The Mycelium wallet for android has 100k-500k downloads.This is an SPV wallet like electrum, where users have control of their keys without needing to run a node.
Bitpay's wallet for android also has 100k-500k downloads, which is an SPV wallet.
The generic bitcoin wallet for android (also SPV) has 1-5M installs.
Multibit (also SPV) is the only desktop client that posts statistics but it claimed 1.5 million downloads in 2014. Now that multibit is discontinued (and bitcoin has gotten more popular since 2014) it's fairly safe to assume that electrum has numbers quite a bit higher than that. I suspect (although I can't prove) that electrum is more popular than all of the android wallets--It's even packaged in TAILS by default.
For comparison, the only popular wallet where users DON'T have control of their keys is the coinbase wallet with 9 million accounts. Other exchanges exist, and may have higher volume, but they don't market themselves as wallets to users.
There are less than 10,000 full nodes running at any given time--and a large amount of that is running 24/7. Its safe to say full-chainers are in the minority if you do some guesstimation.
I got most of these figures from the google play store.
Blockchain.info claims to be the most popular web wallet with 10M users and users have control of their own keys without needing to run a node. Their android app has 1-5M downloads.
The Mycelium wallet for android has 100k-500k downloads.This is an SPV wallet like electrum, where users have control of their keys without needing to run a node.
Bitpay's wallet for android also has 100k-500k downloads, which is an SPV wallet.
The generic bitcoin wallet for android (also SPV) has 1-5M installs.
Multibit (also SPV) is the only desktop client that posts statistics but it claimed 1.5 million downloads in 2014. Now that multibit is discontinued (and bitcoin has gotten more popular since 2014) it's fairly safe to assume that electrum has numbers quite a bit higher than that. I suspect (although I can't prove) that electrum is more popular than all of the android wallets--It's even packaged in TAILS by default.
For comparison, the only popular wallet where users DON'T have control of their keys is the coinbase wallet with 9 million accounts. Other exchanges exist, and may have higher volume, but they don't market themselves as wallets to users.
There are less than 10,000 full nodes running at any given time--and a large amount of that is running 24/7. Its safe to say full-chainers are in the minority if you do some guesstimation.
I got most of these figures from the google play store.
I love that you asked this question! The very reason it doesn't happen often is because of friction inherent to legacy payment systems.
Perhaps I'm misunderstanding what is meant by "international payment", but surely for a majority of people this is just an irrelevance? I can't imagine my parents have ever needed to make an international payment, for instance.
I have an employee in Iran and my goodness was it hard to work out how to pay him (Iranian banks don't have SWIFT and IBAN and helpful things like that), and Bitcoin did actually seem like a legitimate option at one point, until we realised that between business banking and accounting, it was also going to be really hard to do - so I would love for this new wave of currencies to make international payments easier. But I just don't think it's of very much significance to many people in the grand scheme of things. 54% of Americans apparently don't have a passport; are these people really going to be making regular international payments, more than about once a lifetime?
(The significant number of "digital nomads" on HN who work from a beach in Thailand are really not representative!)
However, if we're taking "international payment" to mean "an easy way to take out/spend money when you're on holiday without getting stung by exchange rates and assorted complexities" then I will certainly grant you that this would be broadly regarded as a mainstream benefit (though, again, I guess those 54% of Americans would probably disagree).
Perhaps I'm misunderstanding what is meant by "international payment", but surely for a majority of people this is just an irrelevance? I can't imagine my parents have ever needed to make an international payment, for instance.
I have an employee in Iran and my goodness was it hard to work out how to pay him (Iranian banks don't have SWIFT and IBAN and helpful things like that), and Bitcoin did actually seem like a legitimate option at one point, until we realised that between business banking and accounting, it was also going to be really hard to do - so I would love for this new wave of currencies to make international payments easier. But I just don't think it's of very much significance to many people in the grand scheme of things. 54% of Americans apparently don't have a passport; are these people really going to be making regular international payments, more than about once a lifetime?
(The significant number of "digital nomads" on HN who work from a beach in Thailand are really not representative!)
However, if we're taking "international payment" to mean "an easy way to take out/spend money when you're on holiday without getting stung by exchange rates and assorted complexities" then I will certainly grant you that this would be broadly regarded as a mainstream benefit (though, again, I guess those 54% of Americans would probably disagree).
At least personally, I make recurring payments in euros rather than US dollars and it can be a hassle to see what the actual exchange rate used will be. I also have the option to pay with Bitcoin (and even receive a small discount for it) and it's very easy to see the USD value of the payment in that case. And while I am now in the passport holding minority, that's a recent development and I was previously part of that small overlap with no passport and frequent international payments.
My parents are also moving abroad in the next few months and I'll be very surprised if we don't end up struggling to move money around at some point, even if it's only a minor issue.
My parents are also moving abroad in the next few months and I'll be very surprised if we don't end up struggling to move money around at some point, even if it's only a minor issue.
> I love that you asked this question! The very reason it doesn't happen often is because of friction inherent to legacy payment systems.
I think the reason it doesn't happen often is that most people have no need to send money internationally when all the things they might want to buy are readily available locally or online. Of course there are people who do it all the time, but it's not "mainstream" and I don't see it becoming so.
I think the reason it doesn't happen often is that most people have no need to send money internationally when all the things they might want to buy are readily available locally or online. Of course there are people who do it all the time, but it's not "mainstream" and I don't see it becoming so.
Last week. I'm Canadian and currently working remotely for an American company. I am in Denmark at the moment and need Danish money because they don't do euros. The American company pays me by wire transfer and my Canadian bank skims $15 off the top. Then I transfer day-to-day spending money via the cheapest, best, most reliable service I have yet found - and it still costs $10 per $1000. I do that every month or so. If you're wondering whether a credit card would be cheaper, the answer is no. My credit card is the best one available to me for travelling abroad, and there's no foreign transaction fee - but they do charge 2.5% currency conversion, which is $25 per $1000. And some places don't take credit cards.
All these fees are wasted money from my point of view, and the sooner I can stop paying them, the better.
All these fees are wasted money from my point of view, and the sooner I can stop paying them, the better.
In the current situation with a few popular cryptos, you still have the exact same problem. Using ShapeShift to change BTC to ETC is going to charge a miner fee.
According to Wikipedia, remittances were in excess of $560 billion last year, faciliated by 250 million migrant workers[1].
You and I are not the user demographic ;)
1: https://en.wikipedia.org/wiki/Remittance
You and I are not the user demographic ;)
1: https://en.wikipedia.org/wiki/Remittance
To be fair that demographic has been traditionally served by the hawala system[1]. It's not obvious to me right now that they'd switch to BTC so easily; of course I could be wrong.
1: https://en.wikipedia.org/wiki/Hawala
1: https://en.wikipedia.org/wiki/Hawala
I'm long Bitcoin but those numbers should be taken with a grain of salt before using them to make a case for remittance and Bitcoin.
Some of the top receiving countries include France, Germany or Belgium (over $1000 per inhabitant) and the top sending countries include Luxembourg ($12B for a population of 575K).
So the numbers probably include cross-border workers. People living in France/Germany/Belgium but working in Luxembourg. Transferring euros within the SEPA region (for free) for at least $50B out of the $560B mentioned.
Some of the top receiving countries include France, Germany or Belgium (over $1000 per inhabitant) and the top sending countries include Luxembourg ($12B for a population of 575K).
So the numbers probably include cross-border workers. People living in France/Germany/Belgium but working in Luxembourg. Transferring euros within the SEPA region (for free) for at least $50B out of the $560B mentioned.
That's his point though, the early internet had many useful applications that where appealing to the mainstream. International money transfers are not a mainstream activity.
Can people in this thread please take a minute to consider demographics outside your immediate circles?
250 million people isn't mainstream? These are people sending money to their families on a monthly basis, and where current transfer fees can take the equivalent of a half day of work.
That strikes me as an appealing use case.
That strikes me as an appealing use case.
a highly regulated one too, crypto does not address the complexities of international monetary regulations. If the solution is to not abide by the existing regulations, it not going to be mainstream.
As jogjayr pointed out, the Hawala system has existed before and after formal regulations. Crypto alone might not represent a viable mainstream alternative, but it does have potential as one piece of a composite solution.
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'International' exists outside of EU. Actually most of the problems mentioned above belong to the vast majority of people outside the developed west.
You're indirectly making international payments when you buy imported goods from local shops. When a single global currency is commonplace, you'll likely start doing it directly. The markets already exist in eBay, Alibaba, and Taobao.
> When was the last time you made an international payment?
About an hour ago. I'm on holiday ftw.
But even not on holiday ... Quite often. With an extortionate credit card fee.
About an hour ago. I'm on holiday ftw.
But even not on holiday ... Quite often. With an extortionate credit card fee.
To add to the list of how many of those problems are already solved in the EU :
> Allowing merchants to save 2% in credit card fees (which doubles their profit margin if it was 2% to begin with).
In the EU those fees are capped at 0.2% for debit cards, 0.3% for credit cards [1]. It'll be helpful if the crypto currency fees gets even lower than those, but 0.2% starts to get pretty low.
[1] http://www.consilium.europa.eu/en/press/press-releases/2015/...
> Allowing merchants to save 2% in credit card fees (which doubles their profit margin if it was 2% to begin with).
In the EU those fees are capped at 0.2% for debit cards, 0.3% for credit cards [1]. It'll be helpful if the crypto currency fees gets even lower than those, but 0.2% starts to get pretty low.
[1] http://www.consilium.europa.eu/en/press/press-releases/2015/...
Interesting. In the US average fees are 2%!
>International payments confirmed and spendable in minutes not days. Escaping inflation Venezuela/Argentina/whoeverisnext.
So cryptocurrency is a niche app for crashing economies in the developing world and those needing to do international payments through unofficial channels?
So cryptocurrency is a niche app for crashing economies in the developing world and those needing to do international payments through unofficial channels?
Crypto simply levels the playing field for people in all types of economies. Many countries force you into using the national currency. Often they create artificial exchange rates which do not match up with market rates (Argentina, Venezuela).
Other countries impose capital controls which force their populations to hold devaluing currencies or restrict how they can spend their money. Think India, China. No surprise that China is one of the world leaders in Crypto right now.
Currency is used as a form of control by governments. It is never in control of the people. Look at what happened in Cyprus, and what almost spread across Europe. Banks went bankrupt, people's hard earned money was taken away, simply due to mismanagement at the highest levels.
Properly used cryptocurrency cannot just be taken away. You are in control of your money. Your government does not control its value. Bitcoin as an entity cannot take out loans which its holders are on the hook to repay. Governments can't freeze your wallet with the flick of a switch.
Money is power, and when people are in complete control of their own money, they take back some of the power that has been consistently taken away from them.
Other countries impose capital controls which force their populations to hold devaluing currencies or restrict how they can spend their money. Think India, China. No surprise that China is one of the world leaders in Crypto right now.
Currency is used as a form of control by governments. It is never in control of the people. Look at what happened in Cyprus, and what almost spread across Europe. Banks went bankrupt, people's hard earned money was taken away, simply due to mismanagement at the highest levels.
Properly used cryptocurrency cannot just be taken away. You are in control of your money. Your government does not control its value. Bitcoin as an entity cannot take out loans which its holders are on the hook to repay. Governments can't freeze your wallet with the flick of a switch.
Money is power, and when people are in complete control of their own money, they take back some of the power that has been consistently taken away from them.
>Crypto simply levels the playing field for people in all types of economies. Many countries force you into using the national currency.
And how would you bypass that with cryprocurrency, except by breaking your country's law?
Just because it's a grey area now doesn't mean it will be forever.
And how would you bypass that with cryprocurrency, except by breaking your country's law?
Just because it's a grey area now doesn't mean it will be forever.
Except, you know, the other use cases I listed that you conveniently left out :)
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There are transaction fees with some cryptocurrencies (for example Bitcoin) – for a small purchase they can be much more than 2%.
Fees are always optional. Right now $0.25 will make a tx confirm in under 70 minutes (typical 225-byte tx, 40 sat/B: https://bitcoinfees.21.co). Solutions are being developed left & right to further reduce this: alts, segwit, block size increases (segwit2x, BCH 8MB blocks), payment channels, etc.
(Answer edited. Yes merchants care indirectly about fees.)
(Answer edited. Yes merchants care indirectly about fees.)
How will the average user be able to avoid these fees considering they'll probably be using some 3rd party app?
Appealing to the common person is going to involve larger exchanges how will digital coin grow and still keep digital currencies decentralized?
I apologize for my ignorance in advance. I'm really just trying to learn more about this, and can't find any consensus, even within blogs/articles authored by the same people.
Appealing to the common person is going to involve larger exchanges how will digital coin grow and still keep digital currencies decentralized?
I apologize for my ignorance in advance. I'm really just trying to learn more about this, and can't find any consensus, even within blogs/articles authored by the same people.
Most Bitcoin wallets give users some control on how much they want to pay in fees.
> Merchants don't care as fees are paid by the sender.
As a merchant I absolutely disagree: the cost of my product is how much it costs the user, which includes the complete costs to the user, not just my price.
As a merchant I absolutely disagree: the cost of my product is how much it costs the user, which includes the complete costs to the user, not just my price.
> Sending remittance to family overseas without 10% wasted in fees.
I just looked at TransferWise, and it seems like the rate is about 0.7-2.5% depending on the pair of currencies.
I found this post of transferring 1000 USD -> EUR via BTC which claimed to have done so for $14: https://bitcoin.stackexchange.com/questions/25583/does-it-ma...
TransferWise asks $10 for this. So in the same ballpark, but not necessarily any better.
> Escaping inflation in Venezuela/Argentina/whoeverisnext.
Who is going to sell you Bitcoins for Venezuelan Bolivars? The only people who want Bolivars are those who need it to purchase goods in Venezuela, and are only going to buy enough Bolivar for their spending in the next week tops because keeping any more in Bolivar would be crazy. It also assumes that the people with capital (eg Bitcoin) haven't already just fled the country, e.g. https://www.economist.com/news/americas/21721944-latin-ameri...
And how do they get Bitcoin anyway? I mean, you could use your subsidised electricity to mine it, but then you get arrested because it's sort of obvious: http://reason.com/blog/2017/02/03/venezuela-surbitcoin-arres...
> Allowing merchants to save 2% in credit card fees (which doubles their profit margin if it was 2% to begin with).
Well that would be cool, but Bitcoin has it's own fees, and an unacceptably long delay for any IRL purchases and inherent currency risk on every transaction.
>> Allowing merchants to sell in industries prone to credit card fraud. Etc.
WRT fraud, merchants certainly want transactions to be irreversible, but since we're all terrible at security, being able to reverse transactions is quite useful for dealing with criminals who would try and steal your money.
I just looked at TransferWise, and it seems like the rate is about 0.7-2.5% depending on the pair of currencies.
I found this post of transferring 1000 USD -> EUR via BTC which claimed to have done so for $14: https://bitcoin.stackexchange.com/questions/25583/does-it-ma...
TransferWise asks $10 for this. So in the same ballpark, but not necessarily any better.
> Escaping inflation in Venezuela/Argentina/whoeverisnext.
Who is going to sell you Bitcoins for Venezuelan Bolivars? The only people who want Bolivars are those who need it to purchase goods in Venezuela, and are only going to buy enough Bolivar for their spending in the next week tops because keeping any more in Bolivar would be crazy. It also assumes that the people with capital (eg Bitcoin) haven't already just fled the country, e.g. https://www.economist.com/news/americas/21721944-latin-ameri...
And how do they get Bitcoin anyway? I mean, you could use your subsidised electricity to mine it, but then you get arrested because it's sort of obvious: http://reason.com/blog/2017/02/03/venezuela-surbitcoin-arres...
> Allowing merchants to save 2% in credit card fees (which doubles their profit margin if it was 2% to begin with).
Well that would be cool, but Bitcoin has it's own fees, and an unacceptably long delay for any IRL purchases and inherent currency risk on every transaction.
>> Allowing merchants to sell in industries prone to credit card fraud. Etc.
WRT fraud, merchants certainly want transactions to be irreversible, but since we're all terrible at security, being able to reverse transactions is quite useful for dealing with criminals who would try and steal your money.
"I just looked at TransferWise, and it seems like the rate is about 0.7-2.5% depending on the pair of currencies."
Average remittance fees, worldwide, are ~7%.
"Who is going to sell you Bitcoins for Venezuelan Bolivars? "
No Bolivars involved. Venezuelan bitcoiners typically acquire BTC by selling services or products (sometimes internationally) while receiving payment in BTC.
"Well that would be cool, but Bitcoin has it's own fees, and an unacceptably long delay for any IRL purchases"
Fees are low: https://news.ycombinator.com/item?id=14926127
There is no delay, IRL merchants usually accept 0-conf tx.
"we're all terrible at security,"
Hardware wallets have largely solved this. There has never been a single case of BTC stolen from a hw wallet.
Average remittance fees, worldwide, are ~7%.
"Who is going to sell you Bitcoins for Venezuelan Bolivars? "
No Bolivars involved. Venezuelan bitcoiners typically acquire BTC by selling services or products (sometimes internationally) while receiving payment in BTC.
"Well that would be cool, but Bitcoin has it's own fees, and an unacceptably long delay for any IRL purchases"
Fees are low: https://news.ycombinator.com/item?id=14926127
There is no delay, IRL merchants usually accept 0-conf tx.
"we're all terrible at security,"
Hardware wallets have largely solved this. There has never been a single case of BTC stolen from a hw wallet.
> WRT fraud, merchants certainly want transactions to be irreversible, but since we're all terrible at security, being able to reverse transactions is quite useful for dealing with criminals who would try and steal your money.
It's more a point about how the horrible service from the current transfer processors is opening a niche for different kinds of transfers to prosper. Somehow, that niche hasn't attracted good quality processors (I blame it on widespread corruption), so it's left open for unofficial money.
That's an opportunity, yes. But I am nor sure it can be fully taken before official processors close it.
It's more a point about how the horrible service from the current transfer processors is opening a niche for different kinds of transfers to prosper. Somehow, that niche hasn't attracted good quality processors (I blame it on widespread corruption), so it's left open for unofficial money.
That's an opportunity, yes. But I am nor sure it can be fully taken before official processors close it.
I love cryptocurrency Goolybib Founder Voice
But could you expound on this part here
> Participating in modern e-commerce for the unbanked/underbanked
From my experience, the unbanked hardly have a chance to own cryptocurrency because they don't even have internet. In my country, MPesa is pretty much ubiquitous and that is because it doesn't need the internet to work.
Are there any ideas on how to overly SMS functionality over cryptocurrency in order to truly bank the unbanked? One idea that is bouncing in my head is a sort of agency model where agents can actually have the internet set up in physical premises and they can be the ones to set up crypto-wallets and withdraw/deposit fiat. The unbanked users can simply continue to use SMS based systems to operate their crypto-wallets.
Only problem is that they wouldn't necessarily truly own their coins - most users on HN may care about that but these folks wouldn't. If it works, it works and that's all they'd care about.
I just thought about the idea now when I read your comment so it isn't necessarily refined.
But could you expound on this part here
> Participating in modern e-commerce for the unbanked/underbanked
From my experience, the unbanked hardly have a chance to own cryptocurrency because they don't even have internet. In my country, MPesa is pretty much ubiquitous and that is because it doesn't need the internet to work.
Are there any ideas on how to overly SMS functionality over cryptocurrency in order to truly bank the unbanked? One idea that is bouncing in my head is a sort of agency model where agents can actually have the internet set up in physical premises and they can be the ones to set up crypto-wallets and withdraw/deposit fiat. The unbanked users can simply continue to use SMS based systems to operate their crypto-wallets.
Only problem is that they wouldn't necessarily truly own their coins - most users on HN may care about that but these folks wouldn't. If it works, it works and that's all they'd care about.
I just thought about the idea now when I read your comment so it isn't necessarily refined.
If you live in a high inflation country you still have to pay taxes in that country's currency. In many of these countries the exchange rate is pinned far away from its real value and it would be difficult to sell a large quantity of cryptocurrency without missing out and theoretically you could also be subject to punitive taxation.
>International payments confirmed and spendable in minutes not days.
Unless bitcoin transactions are clogged this week, and ignoring its extreme volatility and difficulties in conversion at both ends.
> Escaping inflation in Venezuela/Argentina/whoeverisnext.
The Venezuela case is made-up BS, and the same for slotting in some other country. Worked example: https://news.ycombinator.com/item?id=14552819
> Sending remittance to family overseas without 10% wasted in fees.
Instead, they lose it in volatility and delays, and the difficulties cashing out at the other end - the latter was so bad for rebit.ph that they literally had to start an exchange just to have enough pesos on hand.
You're reciting cut'n'paste talking points that are largely refuted, like a Gish gallop in a single paragraph. This is not good argumentation.
Unless bitcoin transactions are clogged this week, and ignoring its extreme volatility and difficulties in conversion at both ends.
> Escaping inflation in Venezuela/Argentina/whoeverisnext.
The Venezuela case is made-up BS, and the same for slotting in some other country. Worked example: https://news.ycombinator.com/item?id=14552819
> Sending remittance to family overseas without 10% wasted in fees.
Instead, they lose it in volatility and delays, and the difficulties cashing out at the other end - the latter was so bad for rebit.ph that they literally had to start an exchange just to have enough pesos on hand.
You're reciting cut'n'paste talking points that are largely refuted, like a Gish gallop in a single paragraph. This is not good argumentation.
"Unless bitcoin transactions are clogged this week"
You can always choose to have a tx confirmed in 10 minutes if you choose to pay the appropriate fee.
"difficulties in conversion at both ends."
You are really stuck in the mindset that one "must" convert to spend coins. But as Bitcoin adoption increases there is less and less a need to convert it. Example: my brother in France sent me BTC and I spent it instantly in the US at NewEgg, a retailer who accepts BTC.
"The Venezuela case is made-up BS"
It's real. Yes journalists exaggerate on how much Bitcoin is used. But it is growing, and quickly: https://coin.dance/volume/localbitcoins/VEF
"Instead, they lose it in volatility"
Statistically, volatility (which has been greatly decreasing by the way: https://mobile.twitter.com/lsukernik/status/8649208737189519...) causes users to lose money half the time and win half the time. So, meh, not a real problem. It averages to zero. On the other hand traditional remittance companies screw you over every single time with a fee averaging 7% worldwide (https://remittanceprices.worldbank.org/en). Clearly I prefer my brother sending me BTC than using Western Union.
You can always choose to have a tx confirmed in 10 minutes if you choose to pay the appropriate fee.
"difficulties in conversion at both ends."
You are really stuck in the mindset that one "must" convert to spend coins. But as Bitcoin adoption increases there is less and less a need to convert it. Example: my brother in France sent me BTC and I spent it instantly in the US at NewEgg, a retailer who accepts BTC.
"The Venezuela case is made-up BS"
It's real. Yes journalists exaggerate on how much Bitcoin is used. But it is growing, and quickly: https://coin.dance/volume/localbitcoins/VEF
"Instead, they lose it in volatility"
Statistically, volatility (which has been greatly decreasing by the way: https://mobile.twitter.com/lsukernik/status/8649208737189519...) causes users to lose money half the time and win half the time. So, meh, not a real problem. It averages to zero. On the other hand traditional remittance companies screw you over every single time with a fee averaging 7% worldwide (https://remittanceprices.worldbank.org/en). Clearly I prefer my brother sending me BTC than using Western Union.
When Cryptocurrency goes mainstream, how do we know that the Governments won't introduce regulations (/taxes?) on them ?
They absolutely would do both of those things.
A world where Bitcoin was the default currency would rob nations of control over their own monetary policy, which is one of the most important tools for controlling the economy. Not to mention we'd be living in a world of persistent deflation (due to the ceiling on the maximum number of Bitcoins) which would have interesting consequences on the economy too.
The only cryptocurrencies that would be allowed to gain widespread usage would be those controlled by the central banks.
A world where Bitcoin was the default currency would rob nations of control over their own monetary policy, which is one of the most important tools for controlling the economy. Not to mention we'd be living in a world of persistent deflation (due to the ceiling on the maximum number of Bitcoins) which would have interesting consequences on the economy too.
The only cryptocurrencies that would be allowed to gain widespread usage would be those controlled by the central banks.
It would only be a deflationary world if Bitcoin were the only currency. Since there are lots of digital currencies, we actually have something like the privately-issued competing currencies advocated by Hayek in The Denationalization of Money.
I am rooting for cryptocurrencies just for cross border payments. What we have today is abysmal and pathetic. We pay a lot of overhead sometimes 3% + 2.5%. I think circle or some startup is about to offer near zero cost cross border payments. We might never need a payment gateway !, per my understanding of the protocol at least.
For me the real benefit of bitcoin is how easy it makes it to send money on the internet. If society at large treated bitcoin like a currency (i.e. suitable for settling all debts, whether public or private), the ease with which it can be sent online without intermediaries, anywhere in the world is what's really great about it.
Internet money, true international internet money. That's what I like about it. If you just ever care about USD and everything you do in your life is in USD and you live in the US, there's little value in bitcoins. When I got started getting paid for IRC math tutoring, from people I had never met, whose identity I didn't know and didn't care about, but who could send me money if I just gave them a bitcoin address; that's when I really started to like bitcoins.
I think bitcoin's utility is a separate question from regulations and taxes. Unlike most other bitcoin proponents, I like regulations and taxes, and I would be happy for whatever laws society thinks we need around bitcoins. I've paid sales tax with bitcoins when I've bought stuff with bitcoins from online retailers who accept them.
The problem I have with banks is that I just think that they are awfully inefficient. Their security features are awfully inconvenient and theatrical. I mean stuff like password requirements and website design, not stuff like being able to roll back incorrect or fraudulent transactions (which, btw, didn't work for me; the one time I had my debit card skimmed the bank didn't do me a whit of good in getting my money back).
Sending Bitcoins is as easy as sending email. Some banks in parts of the world let you do almost that, but it's just not as easy and convenient, and it's certainly not international.
Internet money, true international internet money. That's what I like about it. If you just ever care about USD and everything you do in your life is in USD and you live in the US, there's little value in bitcoins. When I got started getting paid for IRC math tutoring, from people I had never met, whose identity I didn't know and didn't care about, but who could send me money if I just gave them a bitcoin address; that's when I really started to like bitcoins.
I think bitcoin's utility is a separate question from regulations and taxes. Unlike most other bitcoin proponents, I like regulations and taxes, and I would be happy for whatever laws society thinks we need around bitcoins. I've paid sales tax with bitcoins when I've bought stuff with bitcoins from online retailers who accept them.
The problem I have with banks is that I just think that they are awfully inefficient. Their security features are awfully inconvenient and theatrical. I mean stuff like password requirements and website design, not stuff like being able to roll back incorrect or fraudulent transactions (which, btw, didn't work for me; the one time I had my debit card skimmed the bank didn't do me a whit of good in getting my money back).
Sending Bitcoins is as easy as sending email. Some banks in parts of the world let you do almost that, but it's just not as easy and convenient, and it's certainly not international.
It's illuminative that you didn't mention the trustlessness of blockchain.
After all that was the original idea: Anybody can verify transactions without asking a central authority. But this is mostly not happening.
Why?
It's too difficult. To really trust blockchain on your own you have to understand game theory, cryptography and networks. You have to read source code and compile your clients yourself. Almost nobody does that.
So what's the point?
People are mostly in it for gambling or because they don't have a choice, for example illegal transactions. A honest answer whether they trust bitcoin would be a resounding no! And the banks? They see a way to reduce costs. Then the customers will trust the bank telling them to use it (or not).
It's quite a perversion. I predict: Blockchain will succeed not because of its trustless nature but because it helps reducing transaction costs.
Poor Satoshi Nakamoto would roll over in his grave (if he is dead).
After all that was the original idea: Anybody can verify transactions without asking a central authority. But this is mostly not happening.
Why?
It's too difficult. To really trust blockchain on your own you have to understand game theory, cryptography and networks. You have to read source code and compile your clients yourself. Almost nobody does that.
So what's the point?
People are mostly in it for gambling or because they don't have a choice, for example illegal transactions. A honest answer whether they trust bitcoin would be a resounding no! And the banks? They see a way to reduce costs. Then the customers will trust the bank telling them to use it (or not).
It's quite a perversion. I predict: Blockchain will succeed not because of its trustless nature but because it helps reducing transaction costs.
Poor Satoshi Nakamoto would roll over in his grave (if he is dead).
I think you hit it on the head. Usability. I'm an IT guy and run a headless linux distro with GPU's, mining one of the currencies. I have Accounts on on Kraken and Coinbase along with my Jaxx wallet and local wallet, that I have to use CLI to send with. I have difficulty using Kraken and if my Jaxx wallet doesn't have the currencies I want as part of the ShapeShift application I have to shift to the web app ShapeShift. Bottom line, it can be a pain in the ass to use all of the different platforms to buy/sell and transfer.
I do like the Jaxx interface and if they can adapt more currency wallets and integrate them with ShapeShift, that would go along way to more widespread adoption.
I do like the Jaxx interface and if they can adapt more currency wallets and integrate them with ShapeShift, that would go along way to more widespread adoption.
Gain purchasing power without the central bank constantly taking it away.
Buying drugs.
> What is cryptocurrency going to help these people do that they can't do already today?
"I want to play investor and get filthy rich but don't have enough money to be an accredited investor, playing stocks feels too hard, and angel investing seems too risky."
It's solving that problem.
"I want to play investor and get filthy rich but don't have enough money to be an accredited investor, playing stocks feels too hard, and angel investing seems too risky."
It's solving that problem.
How many shares are outstanding? According to which exchange? Oh, it was recorded on the Bitcoin blockchain? No question, then.
What about a deed or title for property? Which of countless organizations and public records sources has the document? If it was entered on the Ethereum blockchain, there's no doubt as to ownership.
There's also tracking of goods; outbreak of salmonella? If the trail is available on a blockchain then it's easy to find the source and anything else that might be tainted.
The only reason crypto is volatile right now is due to speculation on which blockchain(s) will be most successful, just as TCP/IP was not always the foremost protocol. It is the nature of growth to be uncertain and wild, and be certain that there is no going backward: Bitcoin and blockchains are here to stay.
One additional note is that they are incredibly powerful tools for control and tracking - a deep state's wet dream, in the process of being willfully adopted by the masses and soon to be the delineating mark between the haves and have-nots. Make no mistake: blockchains can be manipulated by institutional forces. Huxley and Orwell could not have imagined this in their worst nightmares... beware.
What about a deed or title for property? Which of countless organizations and public records sources has the document? If it was entered on the Ethereum blockchain, there's no doubt as to ownership.
There's also tracking of goods; outbreak of salmonella? If the trail is available on a blockchain then it's easy to find the source and anything else that might be tainted.
The only reason crypto is volatile right now is due to speculation on which blockchain(s) will be most successful, just as TCP/IP was not always the foremost protocol. It is the nature of growth to be uncertain and wild, and be certain that there is no going backward: Bitcoin and blockchains are here to stay.
One additional note is that they are incredibly powerful tools for control and tracking - a deep state's wet dream, in the process of being willfully adopted by the masses and soon to be the delineating mark between the haves and have-nots. Make no mistake: blockchains can be manipulated by institutional forces. Huxley and Orwell could not have imagined this in their worst nightmares... beware.
Is it on bitcoin cash, or bitcoin core, or bitcoin XL, or bitcoin segwit2 (some options may be incorrect.. :) )
Re: real estate.
I've heard this one many times. Bu everyone now still has to agree to enter the transaction on some specific block chain. Even if you limit things to just the us. The issue isn't that we don't have the tech to have a national database. It's that the records are scattered all over dusty county and town clerks offices in thousands of jurisdictions for all sorts of historical and political reasons.
I've heard this one many times. Bu everyone now still has to agree to enter the transaction on some specific block chain. Even if you limit things to just the us. The issue isn't that we don't have the tech to have a national database. It's that the records are scattered all over dusty county and town clerks offices in thousands of jurisdictions for all sorts of historical and political reasons.
Yes, there are challenges. That isn't to say now is when everything will happen but there is rapid progress being made toward that point, and pilot programs are moving forward.
Most municipalities have digital records available. It ought to take less time to translate those to blockchain records than the time it took for paper documents to be digitized.
As for the selection of blockchain, that's part of where the current speculative wave in the technology comes in. Competition will persist until there are only a handful of well-defined players, at which point it will be reasonable for governments to tie records to them. All it takes is time.
Most municipalities have digital records available. It ought to take less time to translate those to blockchain records than the time it took for paper documents to be digitized.
As for the selection of blockchain, that's part of where the current speculative wave in the technology comes in. Competition will persist until there are only a handful of well-defined players, at which point it will be reasonable for governments to tie records to them. All it takes is time.
Playing stocks is hard?
!. Open a robinhood account. 2. By AMZN.
Come back in a year. Double your cash.
The problem is, that's so boring! :-)
!. Open a robinhood account. 2. By AMZN.
Come back in a year. Double your cash.
The problem is, that's so boring! :-)
Some of this is (to an extent) semantics. What counts as mainstream. Is spotify mainstream if more people still use CDs or tapes than streaming services? Any definition will be at least partially arbitrary, even if some are better than others.
I think the relevant question is "are digital coins an important part of future money?"
I think it's telling that this article is mostly concerned with investment, fortunes risked, fortunes made. Salacious and dramatic. Not so relevant right now to that question.
Investment has a role en route to "mainstream" but this isn't the bottleneck in 2017. Use is - buying goods and services.
On that front, the article has little to say.
I'm skeptical that cryptocurrencies will last unless a lot more people start buying and selling things, paying bills, receiving salaries... Even if they do last as digital investment assets, I'm not sure it matters much.
I think the relevant question is "are digital coins an important part of future money?"
I think it's telling that this article is mostly concerned with investment, fortunes risked, fortunes made. Salacious and dramatic. Not so relevant right now to that question.
Investment has a role en route to "mainstream" but this isn't the bottleneck in 2017. Use is - buying goods and services.
On that front, the article has little to say.
I'm skeptical that cryptocurrencies will last unless a lot more people start buying and selling things, paying bills, receiving salaries... Even if they do last as digital investment assets, I'm not sure it matters much.
Perhaps the comparison should be to linux. Barely anyone knows what this is and yet it runs on most of the phones of the world & is behind most websites aswell. Linux had a long runway to get there.
Rusty Russell has a nice talk about this: https://medium.com/@rusty_lightning/transcript-my-20-year-jo...
Rusty Russell has a nice talk about this: https://medium.com/@rusty_lightning/transcript-my-20-year-jo...
Yeah, I also suspect this may be it. Cryptocurrency will be useful to consumers 'directly' in exactly the same sense that linux is useful to consumers 'directly' - it runs behind practically every service they touch every day.
The fact that many won't need to know or care that's the case, what it is, how it works, may be similarly irrelevant.
The fact that many won't need to know or care that's the case, what it is, how it works, may be similarly irrelevant.
Whether or not one agrees, I've heard many smart folks without a particular dog in the hunt compare blockchain today with the internet circa 1980.
The web was mainstream when I was like 10 on AOL doing who knows what with all my classmates. My grandparents even got into it and sent me emails and chatrooms. Geocities was more or less main stream and kinda like pre-social media. Those communities were a little different.
I can also remember using Altavista and Lycos before I ever heard of a Google. My mom introduced me to google to help me research papers for school. She showed me how to do complex searches and is by no means good with technology.
Absolutely agree bitcoin is not ready for main stream. It's daunting for non techies. It wouldn't be mainstream until I can use it as easy as cash or card. Or mom and pop places accept it.
I can also remember using Altavista and Lycos before I ever heard of a Google. My mom introduced me to google to help me research papers for school. She showed me how to do complex searches and is by no means good with technology.
Absolutely agree bitcoin is not ready for main stream. It's daunting for non techies. It wouldn't be mainstream until I can use it as easy as cash or card. Or mom and pop places accept it.
Your mom is an outlier.
Not really. Don't know when you lads/lasses were born, but the Web was already mainstream, with everybody and their dog getting on it, on 1998-9 or so. It didn't have to wait until Facebook.
In the US, 30% adoption by 1998, 50% adoption by 2000. But much higher rates of adoption for the wealthier households and much lower for the poorer.
So depends on your economic state then.
So depends on your economic state then.
30% is still totally mainstream, even if it's the richer 30%.
Imagine a music genre that 30% of the population enjoys. In what way wouldn't that be totally mainstream?
Imagine a music genre that 30% of the population enjoys. In what way wouldn't that be totally mainstream?
> Your mom is an outlier.
That comment is funnier when you haven't read the parent comment. I imagine it as a statistician's snub.
That comment is funnier when you haven't read the parent comment. I imagine it as a statistician's snub.
Probably for using Google early but not search engines. Vaguely remember school computer labs with various search engine in late 90s.
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Even taking your (IMO incorrect) assumption that the web only became mainstream when Facebook launched at face value...
> When Hotbot was launched and could actually search with some degree of efficiency it wasn't mainstream.
That was 1996.
> When I could post on Twitter and Facebook it was starting to feel like it was mainstream.
That was 2004. So roughly a gap of 8 years.
Bitcoin started in 2009. It's now 2017. A gap of 8 years.
So, uh, how much longer is a "a long way off"?
> When Hotbot was launched and could actually search with some degree of efficiency it wasn't mainstream.
That was 1996.
> When I could post on Twitter and Facebook it was starting to feel like it was mainstream.
That was 2004. So roughly a gap of 8 years.
Bitcoin started in 2009. It's now 2017. A gap of 8 years.
So, uh, how much longer is a "a long way off"?
The web was developed for a long time before 1996. I'd wager cryptocurrency has another 8 years before it's mainstream.
I thought the Internet had gone mainstream in 1992 when I was passed by a UPS truck with their URL painted on the side..
Are you sure it was 1992?
Wikipedia says that there were only 50 web servers in the world in January 1993, and my recollection is that were all at educational and research institutions. I don't think for example that any of the major computer companies, e.g., Microsoft or Apple, had web site that early. (They had internet connectivity, domain names, mail servers, ftp servers -- but back then, ftp servers did not have URLs.) Maybe one or 2 had web servers, but if they did, they were probably the personal projects of one or two employees.
Most of the world's web pages were about computers and the internet.
Wikipedia says that there were only 50 web servers in the world in January 1993, and my recollection is that were all at educational and research institutions. I don't think for example that any of the major computer companies, e.g., Microsoft or Apple, had web site that early. (They had internet connectivity, domain names, mail servers, ftp servers -- but back then, ftp servers did not have URLs.) Maybe one or 2 had web servers, but if they did, they were probably the personal projects of one or two employees.
Most of the world's web pages were about computers and the internet.
Yes. It was something of a surprise at the time. It was also in the UK, on the A1. I know the year because it was shortly after I started a specific job that required driving up and down the A1 often. It would have been late in the year because I think I started that job in November.
Here is the registered date from whois for ups.com :
Created Date: 1992-04-07
I think you (or Wikipedia) are quite mistaken about 50 web servers in early 1993. I remember giving a talk about the Internet in 93 where I showed examples of web sites that were available at the time. One of them was IMDB. If I think of the servers that I ran and my friends ran, I'd get to about 20 so I have a very hard time believing there were only 50 in total. Perhaps there was a huge amount of server growth during 1993?
Here is the registered date from whois for ups.com :
Created Date: 1992-04-07
I think you (or Wikipedia) are quite mistaken about 50 web servers in early 1993. I remember giving a talk about the Internet in 93 where I showed examples of web sites that were available at the time. One of them was IMDB. If I think of the servers that I ran and my friends ran, I'd get to about 20 so I have a very hard time believing there were only 50 in total. Perhaps there was a huge amount of server growth during 1993?
Yeah, 1992 is way too early for that. Even then, it wasn't fully mainstream until advertisers felt able to drop the http://www from the url. When companies could just put coke.com at the end of their TV ads or on the can, it was as mainstream as anything.
As I said above it was a surprise to me at the time, but nevertheless true. The domain was registered in April 1992.
I don't know.
The Web and Bitcoin are operating on different time scales. One of the major factors with the Web's speed of success was that it was able to disrupt traditional media industries because it wasn't recognized as a threat until it was too late.
I don't think the Finance industry is going to let the same thing happen with Bitcoin, hence things like R3 and the Enterprise Ethereum Alliance.
The Web and Bitcoin are operating on different time scales. One of the major factors with the Web's speed of success was that it was able to disrupt traditional media industries because it wasn't recognized as a threat until it was too late.
I don't think the Finance industry is going to let the same thing happen with Bitcoin, hence things like R3 and the Enterprise Ethereum Alliance.
Ask your parents to explain cryptocurrency. It's not about wall clock time. It's about milestones.
My point isn't "it's been eight years, so it must be ready", it's "it's been eight years, so you can stop comparing it to the early internet now".
I've been following Bitcoin for five years now, and I've seen this "it's the early Internet, success doesn't happen overnight" attitude that gets more and more false every year.
Bitcoin and the ecosystem around has barely changed since it was released.
I've been following Bitcoin for five years now, and I've seen this "it's the early Internet, success doesn't happen overnight" attitude that gets more and more false every year.
Bitcoin and the ecosystem around has barely changed since it was released.
TCP/IP started going global in the mid-1980s. If you consider Bitcoin to be just the first working example of a digital currency protocol, then a better analogy might even be the first packet switching protocols in the 1960s.
Bitcoin has barely changed, but the cryptocurrency ecosystem as a whole has changed massively, and shows no sign of stopping.
Bitcoin has barely changed, but the cryptocurrency ecosystem as a whole has changed massively, and shows no sign of stopping.
> Bitcoin and the ecosystem around has barely changed since it was released.
And yet it's still going, and with all the turmoil, it hasn't been fundamentally broken yet.
I think in the end, if it remains unbroken (that is, no 50% attacks, etc) bitcoin will become a backing currency for more flexible/faster/easier to use/understand approaches. I think it has a future, but I'm not sure its future is "My mom understands it." It may nonetheless remain useful, and thus, continue to have value, even if itself it never goes "mainstream".
Already it is seeing over the last 2 years a stability in its price that is very comforting. The main criticism is its extreme volatility, but as it is adopted more, as its price goes up, and as more inertia is inserted into the market, it should stabilize even more and cause a positive feedback loop encouraging more adoption. It's doesn't need to be used for day-to-day transactions for it to have value, I think it's already proven that point imho.
The main concern is that this could literally turn around overnight if ever it gets fundamentally hacked/broken. This is always going to be a risk, an uncertainty which might hurt it in the long run. The question is, is this worse than e.g. counterfeit concerns with fiat currency.
And yet it's still going, and with all the turmoil, it hasn't been fundamentally broken yet.
I think in the end, if it remains unbroken (that is, no 50% attacks, etc) bitcoin will become a backing currency for more flexible/faster/easier to use/understand approaches. I think it has a future, but I'm not sure its future is "My mom understands it." It may nonetheless remain useful, and thus, continue to have value, even if itself it never goes "mainstream".
Already it is seeing over the last 2 years a stability in its price that is very comforting. The main criticism is its extreme volatility, but as it is adopted more, as its price goes up, and as more inertia is inserted into the market, it should stabilize even more and cause a positive feedback loop encouraging more adoption. It's doesn't need to be used for day-to-day transactions for it to have value, I think it's already proven that point imho.
The main concern is that this could literally turn around overnight if ever it gets fundamentally hacked/broken. This is always going to be a risk, an uncertainty which might hurt it in the long run. The question is, is this worse than e.g. counterfeit concerns with fiat currency.
If you're like 25, I could be your parent. And I understand cryptocurrency OK, so I guess make sure you have dumb parents before trying this test.
But actually the difficulty of understanding it is a big part of what keeps it from going truly mainstream. When the equivalent of AOL comes along and abstracts all that stuff away for people, that's when you'll see Eternal September all over again.
But actually the difficulty of understanding it is a big part of what keeps it from going truly mainstream. When the equivalent of AOL comes along and abstracts all that stuff away for people, that's when you'll see Eternal September all over again.
[deleted]
Do you think hotbot launched on day 1 of the web?
> When I switched to this new upstart called Google it wasn't mainstream.
It was in schools by that time. Youngsters could well embrace crypto long before the rest of the normies. I would have loved it when I was a kid. Anyone got kidos who grind crypto?
If you're reading the nytimes for crypto, then you're behind the curve. Bigly. Digital coins. Fucking morons.
& if you're reading the nytimes for crypto investment advice, then you're probably exposing yourself to risk with limited upside. Find someone who is investing in this shit full-time & give your money to them. Even tech VCs invest in crypto hedge funds. Polychain Capital is an example. Olaf Carlson-Wee (who runs it) was on the cover of Forbes recently (I believe ). They're the type of ppl you want investing for you. You could also bing Ari David Paul &/or Chris Burniske. The former is opening a fund. The latter will probably open a fund after his book 'Cryptoassets' is released (I think that's the play).
It was in schools by that time. Youngsters could well embrace crypto long before the rest of the normies. I would have loved it when I was a kid. Anyone got kidos who grind crypto?
If you're reading the nytimes for crypto, then you're behind the curve. Bigly. Digital coins. Fucking morons.
& if you're reading the nytimes for crypto investment advice, then you're probably exposing yourself to risk with limited upside. Find someone who is investing in this shit full-time & give your money to them. Even tech VCs invest in crypto hedge funds. Polychain Capital is an example. Olaf Carlson-Wee (who runs it) was on the cover of Forbes recently (I believe ). They're the type of ppl you want investing for you. You could also bing Ari David Paul &/or Chris Burniske. The former is opening a fund. The latter will probably open a fund after his book 'Cryptoassets' is released (I think that's the play).
> Anyone got kidos who grind crypto?
I just overheard my kid's friend talking about how you buy everything you want on "the dark web" using bitcoin to pay for it.
I just overheard my kid's friend talking about how you buy everything you want on "the dark web" using bitcoin to pay for it.
That's obviously bad. But kids have always bought drugs.
That is an example of how kidos can create their own economies with crypto. Money is something everyone understands. Even penguins & chimps understand trade (for sex, with the link provided)[0].
If there's a way to ensure children didn't have access to drugs of abuse, I'm all for that. Drugs & developing brains !mix. & it seems prohibition hasn't helped any. It's spawned more concentrated substances & resilient drug markets.
[0] https://en.wikipedia.org/wiki/Prostitution_among_animals
That is an example of how kidos can create their own economies with crypto. Money is something everyone understands. Even penguins & chimps understand trade (for sex, with the link provided)[0].
If there's a way to ensure children didn't have access to drugs of abuse, I'm all for that. Drugs & developing brains !mix. & it seems prohibition hasn't helped any. It's spawned more concentrated substances & resilient drug markets.
[0] https://en.wikipedia.org/wiki/Prostitution_among_animals
How would I go about investing via a hedge fund like Polychain Capital? I can't seam to find contact information online. Do I need to go through a broker?
http://polychain.capital
Edit: I believe you invest in hedge funds directly. That's the impression I've gotten. I do my own investing. So have never used a broker.
Edit: I believe you invest in hedge funds directly. That's the impression I've gotten. I do my own investing. So have never used a broker.
Does anyone have any knowledge/experience of brickblock.io?
I don't know much about them -- if you're asking me.
Edit: I'm focusing on the underlying protocols, ATM.
Edit2: & security. A lot of security.
Edit: I'm focusing on the underlying protocols, ATM.
Edit2: & security. A lot of security.
It is actually quite arguable: Is the web starting to go mainstream from all directions? (personal/professional/state-wide)
In fact, there are still many countries who are not using the Internet for "everything". The point being made: If you can do it through the Internet, why have the brick and mortar office in the first place?
The web revolution is just "getting started". I watched Bloomberg the other day where they were trying to make a point on the Nasdaq: This time it is different. The 2000 bubble was an exponential period of exponential growth (in stock prices, and not the underlying)
This time it is not the same. The growth is linear, and most of the companies have infrastructure or even profit to back it up. (Apple eps is not bubbly)
In fact, there are still many countries who are not using the Internet for "everything". The point being made: If you can do it through the Internet, why have the brick and mortar office in the first place?
The web revolution is just "getting started". I watched Bloomberg the other day where they were trying to make a point on the Nasdaq: This time it is different. The 2000 bubble was an exponential period of exponential growth (in stock prices, and not the underlying)
This time it is not the same. The growth is linear, and most of the companies have infrastructure or even profit to back it up. (Apple eps is not bubbly)
> In the same way that today's web users don't care about html, http, or urls, digital currency won't be mainstream until they don't have to care about private keys, bitcoin addresses, or even (gasp!) the blockchain. We're a long way off.
Not all digital currency has keys. World of Warcraft gold, for example. One would imagine there would be a bank of sorts. Coinbase plays that role, at the moment. They supply cold storage.
It does need to become easier to secure your shit -- given. Most ppl aren't going to be verifying a SHA256 hash function output of their client binaries or use (pseudo)-cypherpunk's public key to verify said hash function is correct against a known good output. Unfortunately!
Not all digital currency has keys. World of Warcraft gold, for example. One would imagine there would be a bank of sorts. Coinbase plays that role, at the moment. They supply cold storage.
It does need to become easier to secure your shit -- given. Most ppl aren't going to be verifying a SHA256 hash function output of their client binaries or use (pseudo)-cypherpunk's public key to verify said hash function is correct against a known good output. Unfortunately!
Bitcoin seems quite straightforward and easy to understand, compared to our current banking system.
A lot of comments mention the difficulty of explaining what is bitcoin and how it works, and that mainstream people cannot get enough understanding to start using it.
What about the actual banking system? There are so much mainstream ignorance about our current banking system.
What does it even mean that I own $2000 at a bank? Ok I understand that I can withdraw this cash, but other than that it is a very abstract concept, built into the opaque IT system of my bank.
If I transfer money from bank A to bank B, what does that mean? Did the banks exchange an envelope of cash? Do mainstream users really understand the details of a bank transaction? I personal have no clue about the inner workings of this banking IT systems. Bitcoin seems very easy to grasp.
Understanding quantitative easing? In the bitcoin world this is transparent and easy to grasp. For my national currency I have no clue of how quantitative easing is done, by how much, etc.
The more I think of our national banking/currency systems, the more I believe bitcoin is way simpler to explain and understand.
A lot of comments mention the difficulty of explaining what is bitcoin and how it works, and that mainstream people cannot get enough understanding to start using it.
What about the actual banking system? There are so much mainstream ignorance about our current banking system.
What does it even mean that I own $2000 at a bank? Ok I understand that I can withdraw this cash, but other than that it is a very abstract concept, built into the opaque IT system of my bank.
If I transfer money from bank A to bank B, what does that mean? Did the banks exchange an envelope of cash? Do mainstream users really understand the details of a bank transaction? I personal have no clue about the inner workings of this banking IT systems. Bitcoin seems very easy to grasp.
Understanding quantitative easing? In the bitcoin world this is transparent and easy to grasp. For my national currency I have no clue of how quantitative easing is done, by how much, etc.
The more I think of our national banking/currency systems, the more I believe bitcoin is way simpler to explain and understand.
That's ridiculous - you seriously think that how the blockchain works and concepts like cryptographic proof-of-work is easier for a layman to understand than interbank settlement and reserve accounts at a central bank?
[deleted]
It means exactly the same as bitcoins. You have an entry on some computers somewhere.
The difference is that the entry on a regulated bank's computer can be used to settle a tax bill, or a loan. The entry in a blockchain can do neither.
So at some point you have get the right sort of money to settle debts imposed on you by wider society.
Blockchain 'currencies' are just intangible bottles of wine, artworks, or tulip bulbs and will go through the same bubble and bust as all those things have previously.
The difference is that the entry on a regulated bank's computer can be used to settle a tax bill, or a loan. The entry in a blockchain can do neither.
So at some point you have get the right sort of money to settle debts imposed on you by wider society.
Blockchain 'currencies' are just intangible bottles of wine, artworks, or tulip bulbs and will go through the same bubble and bust as all those things have previously.
You can't settle a tax bill with gold either.
It means they are holding $2000 of your money. And if you send it to another bank then it means they send it to them and now the other bank is holding your $2000. Nothing hard about that.
Bitcoin might be easy if you're a techie and interested in it. I am not interested in it and I barely even know where to start. What does it mean to mine stuff? Blockchain? What.. There is no way my parents would remotely get started with Bitcoins at this point. And I believe that once it becomes easy enough for mainstream, it will be as abstract as anything.
Bitcoin might be easy if you're a techie and interested in it. I am not interested in it and I barely even know where to start. What does it mean to mine stuff? Blockchain? What.. There is no way my parents would remotely get started with Bitcoins at this point. And I believe that once it becomes easy enough for mainstream, it will be as abstract as anything.
> "It means they are holding $2000 of your money. And if you send it to another bank then it means they send it to them and now the other bank is holding your $2000. Nothing hard about that."
This isn't even close to how modern fractional reserve banking systems or payment settlement processes work. The average user has no need to understand these systems, just as they will have no need to understand how the blockchain works in order to benefit from it.
This isn't even close to how modern fractional reserve banking systems or payment settlement processes work. The average user has no need to understand these systems, just as they will have no need to understand how the blockchain works in order to benefit from it.
I don't mean they hold the cash, I mean they "write a note" that you have deposited $2000. So they know they can give it back to you at some point. If that makes it better I don't know. It was supposed to be a simplification anyway.
The issue with Bitcoin is that you current kind of need to know about how it all works don't you?
The issue with Bitcoin is that you current kind of need to know about how it all works don't you?
You don't need to know how it works, you just need to download some software on your phone, or buy a hardware wallet, and then buy some Crypto from some place like Coinbase. Sending/receiving crypto (specifically Bitcoin or Ethereum) is actually very easy.
The real issues right now are:
1. Buying crypto in the US requires giving private info to 3rd party companies you may not trust (I wish my bank sold Bitcoin) or using a Bitcoin ATM, which most people would be hesitant to use.
2. Storing coins on your phone wallet has more risk than using Apple Pay or a credit card.
3. If you use a phone or hardware wallet, you have to maintain your mnemonic phrase, or if you lose your wallet, you lose all of your money.
4. Prices aren't stable, and people generally want their currency to be stable. In some countries, crypto is more stable than the local currency, but in the US, that isn't the case.
These things can be made easier, and hopefully financial institutions get on board and start providing crypto access with means of securely storing your mnemonic phrase in a way that they can't access without you.
The real issues right now are:
1. Buying crypto in the US requires giving private info to 3rd party companies you may not trust (I wish my bank sold Bitcoin) or using a Bitcoin ATM, which most people would be hesitant to use.
2. Storing coins on your phone wallet has more risk than using Apple Pay or a credit card.
3. If you use a phone or hardware wallet, you have to maintain your mnemonic phrase, or if you lose your wallet, you lose all of your money.
4. Prices aren't stable, and people generally want their currency to be stable. In some countries, crypto is more stable than the local currency, but in the US, that isn't the case.
These things can be made easier, and hopefully financial institutions get on board and start providing crypto access with means of securely storing your mnemonic phrase in a way that they can't access without you.
If everyone wants to take their $2000 out at once, can they?
In most countries that's highly unlikely, so is it really $2000? Or something entirely different?
In most countries that's highly unlikely, so is it really $2000? Or something entirely different?
It's debt, they're not storing money for you unless you get a safe deposit box and leave it in that.
Deposits are loans you make to the bank. The interest rate is crap because you want the ability to call in that debt whenever you feel like. But like loaning anyone else money, they might not have it on them when you come to collect.
Deposits are loans you make to the bank. The interest rate is crap because you want the ability to call in that debt whenever you feel like. But like loaning anyone else money, they might not have it on them when you come to collect.
Deposits are de facto loans, but not given the same rights as the actual loans the banks are creating.
A long, long, long time from now they'll call that exploitation in the name of convenience and the status quo.
A long, long, long time from now they'll call that exploitation in the name of convenience and the status quo.
> If everyone wants to take their $2000 out at once, can they?
They'd stand a better chance than everyone trying to withdraw their bitcoins from the various ~bucket shops~ er, bitcoin exchanges.
They'd stand a better chance than everyone trying to withdraw their bitcoins from the various ~bucket shops~ er, bitcoin exchanges.
Are you suggesting that bitcoin exchanges keep a fractional reserve? Nonsense.
Also, there's no requirement that you keep your coins in an exchange unless you're, well, exchanging them. That's kinda the point.
Also, there's no requirement that you keep your coins in an exchange unless you're, well, exchanging them. That's kinda the point.
> Are you suggesting that bitcoin exchanges keep a fractional reserve?
No, fractional reserve would imply transparency. I'm pointing out that historically, several large bitcoin exchanges have lost or stolen their customers' coins, and lied or tried to hide that fact.
No, fractional reserve would imply transparency. I'm pointing out that historically, several large bitcoin exchanges have lost or stolen their customers' coins, and lied or tried to hide that fact.
And now we have large bitcoin exchanges which undergo regular, verifiable audits as a result.
BTC-e has never been a reputable exchange. Nobody has recommended its use ever since there's been reasonable alternatives, such as Coinbase and Kraken.
Also, the fact that it was used for money laundering does not in any way show that the exchange system provided to customers was anything other than totally above-board. That the police are able to steal people's money when the issue at hand has nothing to do with those people's money is the problem here. HSBC isn't stealing its customers' money because it turned a blind eye to money laundering either.
Also, the fact that it was used for money laundering does not in any way show that the exchange system provided to customers was anything other than totally above-board. That the police are able to steal people's money when the issue at hand has nothing to do with those people's money is the problem here. HSBC isn't stealing its customers' money because it turned a blind eye to money laundering either.
What happens to Bitcoin if everyone decides to cash in?
Same as what would happen in case of USD - price would drop to zero.
Well, someone has to be buying all those btc at the other end. It might drop a lot but I find zero unlikely.
"Price drop to 0" literally means nobody's buying it, of course. If everybody (in the absolute) suddenly decided they didn't want to hold bitcoins, the price would indeed be 0, since there wouldn't be any buyers. (It might even be negative in some cases - you'd have to pay someone to take it from you.)
Price tanks. But your bitcoin remains.
I think it is common knowledge that banks use money to invest, lend to others for profit and so on. So no, not everyone could take it out at once as it would crash the bank.
I guess you could say that they hold your $2000 most times, but at times they use it for something else and are in debt to you.
I don't think on the user-level it is complicated at all. You can literally go to a bank, have them create your account and give them physical money. Then take it out.
I guess you could say that they hold your $2000 most times, but at times they use it for something else and are in debt to you.
I don't think on the user-level it is complicated at all. You can literally go to a bank, have them create your account and give them physical money. Then take it out.
It's common understanding. It's also completely wrong.
Banks are money factories, not warehouses. When you go for a loan the Bank creates the money for you on the spot. DR Loan Assets, CR Deposits.
We pay for things by swapping somebody else's liabilities with each other.
Banks are money factories, not warehouses. When you go for a loan the Bank creates the money for you on the spot. DR Loan Assets, CR Deposits.
We pay for things by swapping somebody else's liabilities with each other.
Which primarily shows that you don't understand the banking system?
Banks generally don't invest (with the exception of investment banks, but that does not have anything to do with the money in your account). They don't hold your money at all, rather they are in debt to you the moment you put money into your account. Also, there are way more functions and processes at a bank than "putting money into your account" and "withdrawing from your account".
Banks generally don't invest (with the exception of investment banks, but that does not have anything to do with the money in your account). They don't hold your money at all, rather they are in debt to you the moment you put money into your account. Also, there are way more functions and processes at a bank than "putting money into your account" and "withdrawing from your account".
So where do the $2000 go when I hand the bills over? Surely they keep it somewhere. And when I want to take it out, they give it back to me (obviously not the same bills).
But yeah, I don't really know how banks work and what they do. But for the average jo (me included) is is all extremely simple to use - which is my point, that Bitcoins are not.
But yeah, I don't really know how banks work and what they do. But for the average jo (me included) is is all extremely simple to use - which is my point, that Bitcoins are not.
Cash is an asset to the bank. If you give $2000 to the bank, they have an asset ($2000 cash) and a matching liability (they owe you $2000).
They either keep that cash to use for a withdraw or can swap it at the central bank (the Fed in the US) for central bank reserves.
Each bank has an account at the central bank, which they use for settling transfers. There are various ways for banks to send instructions to a clearing house (like ACH, Swift, etc.) but at the end of the day they settle the difference by transferring central bank reserves between their accounts at the central bank.
Here's the important part - since banks are transferring both ways between each-other, generally the amount of reserves transferred between them is some fraction of the total amount being credited to each account. For example, if bank A needs to give bank B $100 million, and bank B needs to give bank A $99 million, then only $1 million actually moves at the end of the day. So banks don't need to hold anywhere near the full amount of deposits in reserves. If they don't have enough to make good, they borrow if from another bank, or the lender of last resort (the central bank itself). For this, the CB charges them the official interest rate.
Anyway, that's how banks are able to create money to lend. Since money lent becomes a deposit, lending from existing deposits doesn't work if you want to follow the laws of double entry accounting. Instead, the bank creates an asset (the signed loan contract with you) and then deposits your account (creating the matching liability), creating new bank credit (which is considered money by people and the Government, even if taxes can only be settled in cash or reserves) as well as debt.
They either keep that cash to use for a withdraw or can swap it at the central bank (the Fed in the US) for central bank reserves.
Each bank has an account at the central bank, which they use for settling transfers. There are various ways for banks to send instructions to a clearing house (like ACH, Swift, etc.) but at the end of the day they settle the difference by transferring central bank reserves between their accounts at the central bank.
Here's the important part - since banks are transferring both ways between each-other, generally the amount of reserves transferred between them is some fraction of the total amount being credited to each account. For example, if bank A needs to give bank B $100 million, and bank B needs to give bank A $99 million, then only $1 million actually moves at the end of the day. So banks don't need to hold anywhere near the full amount of deposits in reserves. If they don't have enough to make good, they borrow if from another bank, or the lender of last resort (the central bank itself). For this, the CB charges them the official interest rate.
Anyway, that's how banks are able to create money to lend. Since money lent becomes a deposit, lending from existing deposits doesn't work if you want to follow the laws of double entry accounting. Instead, the bank creates an asset (the signed loan contract with you) and then deposits your account (creating the matching liability), creating new bank credit (which is considered money by people and the Government, even if taxes can only be settled in cash or reserves) as well as debt.
>For this reason, none of the investors I spoke with engage in short-term trading but instead choose, in the online parlance of cryptocurrency enthusiasts, to “hodl” (“hold on for dear life,” rather than sell off for temporary gains).
Someone trolled this author. "hodl" is just a misspelling of "hold," not an acronym.
Someone trolled this author. "hodl" is just a misspelling of "hold," not an acronym.
First seen here:
"I am hodling." https://bitcointalk.org/index.php?topic=375643.0
"I am hodling." https://bitcointalk.org/index.php?topic=375643.0
"Pop bottles and Hodl"
That amused me too as well. But I wouldn't be surprised if "hodl" eventually turns into an abbreviation. In order for cryptos to "go mainstream", it will have to say goodbye to some of its attached memes.
Saw Chris DeRose troll him. He runs a sceptical crypto-based podcast (changing the name to 'Chris DeRose Uncensored' (the pod, that is))
I tend to believe this is being upvoted because people want to believe this, not because it's actually true.
There's also probably quite a few influential people who have a vested interest in digital currency increasing in value.
Myself, for example!
This is a big reason. A substantial amount of people with vested interest that would benefit greatly if the price of crypto increases are in tech and post on HN.
So you get a lot of crypto and bitcoin related posts upvoted very quickly here. It's just that HN has disproportional amount of people invested in crypto so they act in their interest.
Most bitcoin early adopters were hackers after all.
So you get a lot of crypto and bitcoin related posts upvoted very quickly here. It's just that HN has disproportional amount of people invested in crypto so they act in their interest.
Most bitcoin early adopters were hackers after all.
Seriously, TFA was posted in the Style section. It's not exactly the most rigorous part of the Times.
It also has a clickbait title added; which gives it an advantage wrt attention.
This is dangerous!
When everyday folks go bust on their crypto holdings, there will be pain, suffering and retribution. Or, perhaps you agree that we don't need any of these pesky financial and gambling regulations and safeguards.
If this article was about Beanie Babies or penny stocks, would you be clapping?
When everyday folks go bust on their crypto holdings, there will be pain, suffering and retribution. Or, perhaps you agree that we don't need any of these pesky financial and gambling regulations and safeguards.
If this article was about Beanie Babies or penny stocks, would you be clapping?
Just keep in mind the age-old adage: never invest more than you are willing to lose. Same goes for beanie babies, penny stocks, and index funds.
Shall we abolish the FDIC and the SEC? Then, should we redirect some of the funds into gambling addiction support groups?
It's not about Beanie Babies or penny stocks.
>“If my landscaper ever asks me about crypto, that’s the day I get out,” he said.
My hairdresser spent an hour extolling the virtues of cryptocurrencies to me a few weeks ago, and yesterday an electrician who was in the office was explaining to us his weekend project which was basically a multisig wallet written in PHP.
Perhaps crypto has already reached peak bubble.
My hairdresser spent an hour extolling the virtues of cryptocurrencies to me a few weeks ago, and yesterday an electrician who was in the office was explaining to us his weekend project which was basically a multisig wallet written in PHP.
Perhaps crypto has already reached peak bubble.
it bears mentioning here that the vast majority of cryptocurrency investors seem to be male, and their Twitter discourse tends to be less than refined, with insults often lodged at devotees of rival currencies.
The vast majority of cryptocurrency investors probably don't even have a twitter account. This seems like a big logical jump to make.
The vast majority of cryptocurrency investors probably don't even have a twitter account. This seems like a big logical jump to make.
I believe that crypto currencies will not affect most people’s lives (<10%), and therefore it will never go “mainstream”. The applications for BTC are quite limited, and are mostly edge cases such as evading detection, and easy international transfers. The value of a BTC is currently based on the price of mining one BTC, plus mass speculation. If you consider the immense inefficiency and resources required to mine a BTC, you realize that in most cases using your state’s currency is a better option. The trust and safety provided by BTC is subject to the law of diminishing returns, meaning that most will be content with the money system currently being used today.
Lets start with the whole, "crypto-concurrency mining is wasting money" argument.
This link https://www.federalreserve.gov/faqs/currency_12771.htm shows how much it costs to print a currency note just in the US. This shows how many notes are in circulation in the us https://www.federalreserve.gov/paymentsystems/coin_currcircv...
Then there's the cost in securing the money, transferring it, and keeping track of it add the cost of fake notes, lost and damaged notes and you should see where I am going with this argument.
Then lets talk about "application of btc for edge cases" moving money internationally is not an edge case, it is something that makes the world go round and disruption in that area is no trivial thing. Its not an edge case. As for crypto being used by people to avoid detection, well, you can do the same things with fiat currencies. Why do you think there are organisation like the FBI hiring highly skilled people to track and trace what people do with their money. In a crypto world there is a better chance for law enforcement to catch criminals.
The best thing about the blockchain is it helps us solve the problem of trust, ofcourse I agree there are problems with this model right now, for example how mining pools can technically launch a 51% attack on the major block-chains and the wole tx/s problem. But what you need to realize is these problems are being acknowledged by the community and are being solved little by little, the technology is progressing there's billions of dollars worth of money tied up in this project. One more point, the block chain is not just about currencies, there's so many more areas where they can be useful. Take a look at the Ethereum project.
Therefore I am someone who really believe that block-chains are here to stay and they are going to effect every single one of us.
Then there's the cost in securing the money, transferring it, and keeping track of it add the cost of fake notes, lost and damaged notes and you should see where I am going with this argument.
Then lets talk about "application of btc for edge cases" moving money internationally is not an edge case, it is something that makes the world go round and disruption in that area is no trivial thing. Its not an edge case. As for crypto being used by people to avoid detection, well, you can do the same things with fiat currencies. Why do you think there are organisation like the FBI hiring highly skilled people to track and trace what people do with their money. In a crypto world there is a better chance for law enforcement to catch criminals.
The best thing about the blockchain is it helps us solve the problem of trust, ofcourse I agree there are problems with this model right now, for example how mining pools can technically launch a 51% attack on the major block-chains and the wole tx/s problem. But what you need to realize is these problems are being acknowledged by the community and are being solved little by little, the technology is progressing there's billions of dollars worth of money tied up in this project. One more point, the block chain is not just about currencies, there's so many more areas where they can be useful. Take a look at the Ethereum project.
Therefore I am someone who really believe that block-chains are here to stay and they are going to effect every single one of us.
It's worth noting that in most countries, notes are a low-single digit percentage of actual money supply. Most money exists either as central bank reserves or bank credit.
Using blockchains (crypto-currencies) as digital escrows will have wide ranging and high value impact. Modernized escrows for the 3rd millenium.
--
Early merchants used cuneiform impressed tokens (or equiv) to represent some kind of trade, for convenience. You and I agreed to trade 100 bushels of wheat for 10 jugs of wine. I give you 100 bushels. You give me 10 wine tokens. I later redeem tokens for actual wine. Or trade my 10 wine for 2 silk. Or whatever.
Those tokens only became "money" when they became ubiquituous enough to become units of measurement (of value) onto themselves, independent of their original intent.
Meaning the escrow medium became currency. A phase change.
Maybe that happens with bitcoin. I don't see it. For me, bitcoins are akin to collectables, like limited edition baseball cards. Precious bits of data that you might be able to pawn off onto someone else.
Until bitcoin becomes currency (a ubiquituous form of escrow), bitcoin investments is just a form of gambling.
Anyone wanting something like bitcoin to supplant something like US dollars should build towards that future by tackling the escrow use cases.
--
Early merchants used cuneiform impressed tokens (or equiv) to represent some kind of trade, for convenience. You and I agreed to trade 100 bushels of wheat for 10 jugs of wine. I give you 100 bushels. You give me 10 wine tokens. I later redeem tokens for actual wine. Or trade my 10 wine for 2 silk. Or whatever.
Those tokens only became "money" when they became ubiquituous enough to become units of measurement (of value) onto themselves, independent of their original intent.
Meaning the escrow medium became currency. A phase change.
Maybe that happens with bitcoin. I don't see it. For me, bitcoins are akin to collectables, like limited edition baseball cards. Precious bits of data that you might be able to pawn off onto someone else.
Until bitcoin becomes currency (a ubiquituous form of escrow), bitcoin investments is just a form of gambling.
Anyone wanting something like bitcoin to supplant something like US dollars should build towards that future by tackling the escrow use cases.
And, now, we have two bitcoins. Cash and umm, Bitcoin.I wonder what effect it has(will have) on the future of cryptocurrency?
Bitcoin Cash isn't the only altcoin. It's just a recent popular one that forked from Bitcoin's blockchain history.
Coinbase is going to support cash... as they go others will as well...
Coinbase currently has no plan to support Bitcoin Cash trading. They won't even support withdrawals until 2018.
Crawl, walk, run. Market demand will change all that.
Quite the day for bitcoin, it may be going mainstream. A few years back I had to travel to the Valley to find a bitcoin ATM and now there are three in my hometown!
Front page of today's Lansing State Journal:
http://www.lansingstatejournal.com/story/news/local/2017/08/...
Can't get more mainstream than that!
Front page of today's Lansing State Journal:
http://www.lansingstatejournal.com/story/news/local/2017/08/...
Can't get more mainstream than that!
The value of fiat currency is that the issuing entity assures it's worth, ensures it's security, it's validity and facilitates flow. The benefits of cryptocurrency may look appealing, however, as a store of wealth it's a long way from 'mainstream' and I believe entropy will prevail, in the fiat system entropy is handled, the supply of money is flexible, in a system with entropy, everyone's wealth will tend towards zero over the long term.
And 2017 will be the year of Linux desktop.
Digital coins will go mainstream the same year the Linux Desktop does. (A.K.A. $currentyear+1)
Regardless of whether it will ever go mainstream in the near future, and as a newbie to cryptocurrency, is it expected that, whenever it goes mainstream, the value will?
1) Dramatically rise
2) Rise
3) Behave as usual (depending on current trend)
4) Fall
5) Dramatically fall
There is a limited total number of bitcoins and the number of bitcoins is increasing very slowly now so technically the more people buy in the more it should go up. Because there is more money in bitcoins but not more bitcoins.
Thanks. So a physical bitcoin is not worth 1 bitcoin, but rather a percentage of the entire bitcoin market value (maybe not the right term), relative to the number of physical bitcoins, correct?
Huh? There is no such thing as a physical bitcoin. 1 bitcoin will always be worth 1 bitcoin. To calculate the total bitcoin market cap you multiply the number of circulating bitcoins by the current exchange rate for your preferred currency.
> There is no such thing as a physical bitcoin.
Of course there are: https://www.google.com/search?q=physical+bitcoin&oq=physical...
As to how they relate to crypto, I have no idea, which is why I asked about it.
Of course there are: https://www.google.com/search?q=physical+bitcoin&oq=physical...
As to how they relate to crypto, I have no idea, which is why I asked about it.
So what happened in 2014?
It depends on how "mainstream" bitcoin gets. Lots of commentators use the current total value of various liquid asset markets, such as gold or M1 money supply, as a rough idea of the market cap bitcoin could grow to.
Taking gold as an example, the ten largest central banks hold a total of about 33,000 tonnes of gold, worth about $1.6 trillion. If bitcoin could cut into, say, one quarter of that, it implies a market cap of $400 billion, or a price of about USD 20,000 per BTC. (Of course, there are good arguments to be made that central banks will never use bitcoin as a reserve asset like gold, but this just shows one example of a rough reckoning for bitcoin's value.)
The price forecasts get more zany & bullish the larger the market you look at, and the larger share you assume bitcoin will take. I personally view it as an option on the potential creation of a new monetary order (with all the risks implied in option ownership). The more that governments and banks use their control over money to dictate the financial lives of their denizens and depositors, the better bitcoin will do.
Taking gold as an example, the ten largest central banks hold a total of about 33,000 tonnes of gold, worth about $1.6 trillion. If bitcoin could cut into, say, one quarter of that, it implies a market cap of $400 billion, or a price of about USD 20,000 per BTC. (Of course, there are good arguments to be made that central banks will never use bitcoin as a reserve asset like gold, but this just shows one example of a rough reckoning for bitcoin's value.)
The price forecasts get more zany & bullish the larger the market you look at, and the larger share you assume bitcoin will take. I personally view it as an option on the potential creation of a new monetary order (with all the risks implied in option ownership). The more that governments and banks use their control over money to dictate the financial lives of their denizens and depositors, the better bitcoin will do.
I would guess rise. There is growing interest in getting involved. The easier it is to buy in, the more will chance it.
All of the above...
My parents know about bitcoin, so as far as I'm concerned digital coins are already mainstream.
I'm still waiting for them to ask me what an ICO is.
I'm still waiting for them to ask me what an ICO is.
What is an ICO?
(I'm only being half-serious. But it's amusing that there isn't a consistent definition. It's basically "you can buy an asset I created out of thin air that may or may not have any utility.")
(I'm only being half-serious. But it's amusing that there isn't a consistent definition. It's basically "you can buy an asset I created out of thin air that may or may not have any utility.")
I have a theory that once you can define ICOs, they will cease to exist in their current form. If the layman buying ICOs for their speculative value understands the asset they're buying, they might not want to buy it anymore.
Don't be so sure. The penny stock market is alive and well. People love to gamble.
I have another theory, ICOs will evolve with public due diligence, real products instead of whitepapers, etc. In this way, companies and people from developing countries and below could raise money faster and with less friction. I am not saying that scams will be surpressed but interesting projects will find a better destiny.
I have another theory, that this has already happened.
I see what you did there. ;-)
https://www.goodreads.com/quotes/2397-there-is-a-theory-whic...
https://www.goodreads.com/quotes/2397-there-is-a-theory-whic...
An ICO is the process of providing liquidity to early coin miners and investors.
Projects are issuing tokens to raise funds (ICO ~= IPO). They are of two types:
1) Protocol coins (coins that have some value within the project / product) and
2) Asset coins (coins that can be thought of as shares in a company).
Protocol coins are being positioned as presold revenue and need not necessarily conform with securities laws. Most ICOs are trying to position their coins as kickstarter-type "token gifts" (e.g. T-shirts)
Asset coins on the other hand, come under the purview of securities laws and act
People are buying these coins because of FOMO. Large majority of these projects having ICOs are scams - not too different from the dot-com bubble. Eventually, some good ideas are going to come out of these projects.
1) Protocol coins (coins that have some value within the project / product) and
2) Asset coins (coins that can be thought of as shares in a company).
Protocol coins are being positioned as presold revenue and need not necessarily conform with securities laws. Most ICOs are trying to position their coins as kickstarter-type "token gifts" (e.g. T-shirts)
Asset coins on the other hand, come under the purview of securities laws and act
People are buying these coins because of FOMO. Large majority of these projects having ICOs are scams - not too different from the dot-com bubble. Eventually, some good ideas are going to come out of these projects.
Pretty good summary:
http://www.investopedia.com/terms/i/initial-coin-offering-ic...
http://www.investopedia.com/terms/i/initial-coin-offering-ic...
My dad has Bitcoin and sends me Cryptocurrency articles.
My girlfriends father was an investment banker during the 80s and is long on gold. Every time I see him he asks me about Bitcoin.
Note: I am not a crypto expert.
My girlfriends father was an investment banker during the 80s and is long on gold. Every time I see him he asks me about Bitcoin.
Note: I am not a crypto expert.
[deleted]
This reminds me of the wired article "the long boom" which described how the economy was on a permanent upswing. The telco / .com crash happened a couple years later.
The article asserts that currency will always go up because people will want it as an investment strategy. Sounds like the idea that real estate value will always go up
The article asserts that currency will always go up because people will want it as an investment strategy. Sounds like the idea that real estate value will always go up
[deleted]
I feel like it's already mainstream, in Singapore at least. I was getting a haircut at the neighbourhood barbershop and I overhead the shop owner talking about cryptocurrency with a female customer -- stuff like regulatory issues, Satoshi's identity, altcoins, and so on. They probably had more knowledge of Bitcoin than I did.
It sounds like a sign of a bubble to me.
Singapore's government has been very favorable to cryptocurrencies. Startups around the world who want to do ICOs have been basing themselves in Singapore, along with several other friendly countries. It wouldn't be surprising if the five million residents of Singapore have an unusually high level of awareness.
I heard similar conversations from laymen in USA recently. During 2000s bubble I heard that you can hear about perspectives of different IT companies form unexpected people as well.
Sounds like cyberpunk to me.
What exactly is 'going mainstream' as it relates to digital coins? Seems like everyone draws the line differently.
If nothing else, cryptocurrency might do one thing that is needed, if only roughly and imperfectly, and is to distribute wealth from the the old to the young.
It's the one counterbalance to the debt based asset bubbles of the last 40 years that have transferred wealth to pensioners at the expense of the young
It's the one counterbalance to the debt based asset bubbles of the last 40 years that have transferred wealth to pensioners at the expense of the young
Care to explain? If anything, it's wealth transfer from the coin/token buyers to sellers.
Yes, it's from more technically savvy to less technical so to some degree from young to old. Not exactly of course but it's the one countervailing flow to the housing and other asset bubbles and debt transfer which have massively transferred wealth in the opposite direction.
Merkle tree code that helps run Bitcoin was written by a grandpa aged person, cryptographic nonces were created by grandpas also and Satoshi and Hal Finney were of the grandpa group too. This generation can thank the last three generations no less, for the opportunity of cryptocurrency.
Not yet in India. It's almost banned here because of lack of compliance.
The first digital coin land rush was when people and companies were registering thousands of somewhat random domain names per day hoping to hit on one that someone would eventually want.
Tulip bulbs are prettier.
"I am clever because tulips and Holland lol. you certainly won't find ME getting taken by all those bitcoin hucksters, yuk yuk yuk"
Money has been getting increasingly less tangible over the past few thousand years.
Initially, the value of money was in the materials that made it up; e.g gold, silver coins.
Then people started paying with paper backed by gold; so although the paper itself had no value, it could be used to redeem gold.
... People got used to paper.
Then people started paying with paper fiat currencies not backed by anything.
Then people started paying with electronic numbers on computer screens in their bank accounts backed by the fiat paper money.
... People got used to digital numbers in their bank accounts.
Now we have cryptocurrencies which are backed by the electronic numbers in our bank accounts.
It does seem like a logical progression.
Initially, the value of money was in the materials that made it up; e.g gold, silver coins.
Then people started paying with paper backed by gold; so although the paper itself had no value, it could be used to redeem gold.
... People got used to paper.
Then people started paying with paper fiat currencies not backed by anything.
Then people started paying with electronic numbers on computer screens in their bank accounts backed by the fiat paper money.
... People got used to digital numbers in their bank accounts.
Now we have cryptocurrencies which are backed by the electronic numbers in our bank accounts.
It does seem like a logical progression.
Money has never been tangible. It always has been a token for a debt owed by somebody.
There is no difference between a paper bill, a coin and a cheque other than the account it references.
There is no difference between a paper bill, a coin and a cheque other than the account it references.
There is a huge difference between a coin and a paper bill.
Unlike the paper bill, the gold coin is both a currency and a commodity - It has many useful properties. It can be melted down and turned into jewellery, used in electronics, tooth fillings, glass-making, paint, etc...
Fiat money can be exchanged for other things but fiat money in itself cannot be converted into anything useful. Destroying fiat currency to sell the underlying material is illegal in most countries.
When gold coins were currency, people would shave slivers of gold from their coins to pay for small things. This emphasises that the value of the currency was entirely in its material.
The value of a gold coin as a currency was equal to its value as a commodity.
Unlike the paper bill, the gold coin is both a currency and a commodity - It has many useful properties. It can be melted down and turned into jewellery, used in electronics, tooth fillings, glass-making, paint, etc...
Fiat money can be exchanged for other things but fiat money in itself cannot be converted into anything useful. Destroying fiat currency to sell the underlying material is illegal in most countries.
When gold coins were currency, people would shave slivers of gold from their coins to pay for small things. This emphasises that the value of the currency was entirely in its material.
The value of a gold coin as a currency was equal to its value as a commodity.
You've obviously never made a paper plane out of a bank note.
Or had one with a printing error where it becomes a collectible artwork.
The value of any coin is far greater than its metal value in any normal system. Gold included.
Or had one with a printing error where it becomes a collectible artwork.
The value of any coin is far greater than its metal value in any normal system. Gold included.
It's worth reading "Debt: The First 5000 Years" by anthropologist David Graeber.
It's actually crazy how much of what most people think about money (such as the above) has actually no anthropological or historical evidence.
It's actually crazy how much of what most people think about money (such as the above) has actually no anthropological or historical evidence.
It's all zero-sum. It doesn't create wealth.
> It's all zero-sum.
But this is the same as "conservation of energy". Everything is zero-sum, and yet we still do stuff.
> It doesn't create wealth.
Well I have two answers for this. One is simple: these are financial products, and people need those. The other answer is a question: what is wealth ? Or, what is value? And these questions are like koans, they are both profound and also without solution. Wild price gyrations on exchanges going back hundreds of years are testament to this.
But this is the same as "conservation of energy". Everything is zero-sum, and yet we still do stuff.
> It doesn't create wealth.
Well I have two answers for this. One is simple: these are financial products, and people need those. The other answer is a question: what is wealth ? Or, what is value? And these questions are like koans, they are both profound and also without solution. Wild price gyrations on exchanges going back hundreds of years are testament to this.
If it enables new kinds of transactions, it will create wealth.
Quick question: what do people do with them? Invest?
I made happy returns (poor-student-sized and regrettably non-leveraged) on three occasions simply by monitoring when exposure would go up and timing the end of hype (e.g. when the first senate hearing on BTC). stats.grok.se, forums and HN were good informers. Then I quit. I wish I knew the full answer to your question.
People pay me for doing stuff. And I pay for stuff, mainly for VPN services and servers.
Until I can pay taxes with it, not interested.
[deleted]
Another way to phrase this is: "Are digital coins on the verge of going mainstream?" to which I reply: Betteridge's law of headlines
That's not the headline. The editorialised headline hasn't been changed.
Incorrect title.
The fucking title is wrong. Not only that, I got downvoted for pointing out it's wrong. & It hasn't been changed.
2017 is the year of Linux on the desktop
ChromeOS put Linux on the desktop and no one noticed.
That's not really "Linux on the desktop" as its advocates imagine it. For most ChromeOS users, the Linux-y parts like the shell and the GNU toolchain are largely restricted.
Not to be overly pedantic but the "shell" and "GNU toolchain" are literally not Linux.
You're right, and I didn't mean to imply those things comprise Linux. They are, however, what most people are talking about when they say they "use Linux". GNU + Linux comprise the "desktop Linux" platform.
Well, were you expecting "Linux on the desktop" to be a giant terminal shell? Of course it was going to hide all the Linux-y stuff. That's what desktop UIs are for. Windows is "DOS on the desktop" and OS X is "BSD on the desktop".
I don't expect a giant terminal shell but I do expect the GNU corelibs, shell utilities and other open source parts of the Linux ecosystem such as systemd and X11/Wayland. The kernel itself isn't the only part of "desktop Linux" in the sense that many people refer to it in.
*Year of Linux running inside pico-processes on top of the NT kernel.
Since POTUS tweets using an Android device in the Oval Office, we can at least say 2017 is the year of Linux on the top desk.
Does Trump still use an Android as POTUS? Any info on what make, OS?
I believe it is a Samsung Galaxy 2. A quick search yielded:
http://bgr.com/2017/01/26/donald-trumps-android-phone/
https://www.cnbc.com/2017/03/29/donald-trump-apple-iphone-an...
http://bgr.com/2017/01/26/donald-trumps-android-phone/
https://www.cnbc.com/2017/03/29/donald-trump-apple-iphone-an...
That's a bit cheapskate for a president.
Bit too risky to upgrade, don't want the POTUS's phone to spontaneously combust.
lol, no. Go ahead download the ledger.
When my university lab computer got trumpet winsock and Netscape installed, it wasn't mainstream. When Hotbot was launched and could actually search with some degree of efficiency it wasn't mainstream. When I learned html and javascript from reading Webmonkey posts it wasn't mainstream. When I switched to this new upstart called Google it wasn't mainstream. When I could use Google Maps to zoom in on the house I used to live in it wasn't mainstream. When I could publish posts on Blogger it wasn't mainstream. When I could post on Twitter and Facebook it was starting to feel like it was mainstream. But when my parents could figure out how to get on Facebook on their mobile phones, I knew that the web had become mainstream, even thought it's debatable how much of the web is really left.
In the same way that today's web users don't care about html, http, or urls, digital currency won't be mainstream until they don't have to care about private keys, bitcoin addresses, or even (gasp!) the blockchain. We're a long way off.
EDIT: Since I get the sense a lot of cryptocurrency proponents are taking this as a dismissal, let me say that I do think it has a bright future. I just think there's a lot of work ahead until we get there.