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Someone should open a company which provides tokens in exchange for depositing BTC with them. People can trade these tokens which are notional representations o

Someone should open a company which provides tokens in exchange for depositing BTC with them. People can trade these tokens which are notional representations of the BTC holdings in an instantaneous manner. Then when someone actually wants the BTC, they redeem the tokens with the company and the BTC is transferred to their wallet... alternatively the company itself could act as an exchange and always send currency instead of tokens to the person receiving a payment. Since all the small transactions are happening via these tokens, the cost of Bitcoin transactions would be a much smaller issue..

che_shirecat 9y ago
what would be the point of this? why not just use mainstream payment methods and then when someone actually wants BTC, purchase it from an exchange for fiat? The whole point of cryptocurrency is that its decentralized, creating a derivative on top of it (for payments??) issued by a centralized company subject to counterparty risk kinda ruins the purported advantages of Bitcoin don't you think?
- mkirklions 9y ago
  I think Ethereum might be the closest thing we have to that today. However, still things require an additional layer to get it to work in the physical world. Lets not forget that this technology only became 'accepted' by the mainstream in 2017. Before that, it was nerds volunteering to program various infrastructure. Also, between accounting, finance, and taxes, implementing cryptocurrency for any fortune 500 company will add additional layers of complexity.
- friedButter 9y ago
  As long as this system is run online,it would be free of regulations,so the govt would not be able to impose it's will on your assets...
  - che_shirecat 9y ago
    Until this only-online "exchange" is "hacked" and suddenly you can't claim any BTC with their tokens anymore. Did you read the "counter-party risk" part of my comment?
    - friedButter 9y ago
      My bad, missed that. Yes, that risk is increased quite a bit, but I thought the main selling point of Bitcoin is that govt can't control your spending, which would stay
  - nkrisc 9y ago
    I think you underestimate many governments.
freeone3000 9y ago
This is the concept behind Lightening. TorGuard is already accepting Lightening payments, so it'll only be a decade or so before legitimate companies get on board.
fragmede 9y ago
Until you trade BTC away from their system, that's what hosted wallets eg, Coinbase, actually look like internally. There's a veneer of the BTC being "yours" but that was just a row in Coinbase's database rather than being live on the blockchain. It's a good one thats already been implemented behind the scenes.
fooker 9y ago
Congratulations, you have discovered a bank!
- friedButter 9y ago
  Haha. Kind of,but not nearly as heavily regulated.. just like older banking systems were banks backed by gold,this would be a bank,but backed by Bitcoin. And not subject to regulations that banks are subject to (such as restrictions on cross border money movement,govt monitoring and ability of the govt to put a lien on your account, any insurance and pro consumer regulations applied to the traditional banking system such as their inability to shut shop one day and keep your money,etc).
  - stordoff 9y ago
    Why would it be less regulated? You might be able to fly under the radar at first, but if regulators took notice I don't see why the same requirements wouldn't apply.
    - friedButter 9y ago
      Pretty much how Uber is not regulated, but they wouldn't have any physical presence for the govt to try and force rules on them

che_shirecat 9y ago

what would be the point of this? why not just use mainstream payment methods and then when someone actually wants BTC, purchase it from an exchange for fiat? The whole point of cryptocurrency is that its decentralized, creating a derivative on top of it (for payments??) issued by a centralized company subject to counterparty risk kinda ruins the purported advantages of Bitcoin don't you think?

mkirklions 9y ago
I think Ethereum might be the closest thing we have to that today. However, still things require an additional layer to get it to work in the physical world. Lets not forget that this technology only became 'accepted' by the mainstream in 2017. Before that, it was nerds volunteering to program various infrastructure. Also, between accounting, finance, and taxes, implementing cryptocurrency for any fortune 500 company will add additional layers of complexity.
friedButter 9y ago
As long as this system is run online,it would be free of regulations,so the govt would not be able to impose it's will on your assets...
- che_shirecat 9y ago
  Until this only-online "exchange" is "hacked" and suddenly you can't claim any BTC with their tokens anymore. Did you read the "counter-party risk" part of my comment?
  - friedButter 9y ago
    My bad, missed that. Yes, that risk is increased quite a bit, but I thought the main selling point of Bitcoin is that govt can't control your spending, which would stay
- nkrisc 9y ago
  I think you underestimate many governments.

freeone3000 9y ago

This is the concept behind Lightening. TorGuard is already accepting Lightening payments, so it'll only be a decade or so before legitimate companies get on board.

fragmede 9y ago

Until you trade BTC away from their system, that's what hosted wallets eg, Coinbase, actually look like internally. There's a veneer of the BTC being "yours" but that was just a row in Coinbase's database rather than being live on the blockchain. It's a good one thats already been implemented behind the scenes.

fooker 9y ago

Congratulations, you have discovered a bank!

friedButter 9y ago
Haha. Kind of,but not nearly as heavily regulated.. just like older banking systems were banks backed by gold,this would be a bank,but backed by Bitcoin. And not subject to regulations that banks are subject to (such as restrictions on cross border money movement,govt monitoring and ability of the govt to put a lien on your account, any insurance and pro consumer regulations applied to the traditional banking system such as their inability to shut shop one day and keep your money,etc).
- stordoff 9y ago
  Why would it be less regulated? You might be able to fly under the radar at first, but if regulators took notice I don't see why the same requirements wouldn't apply.
  - friedButter 9y ago
    Pretty much how Uber is not regulated, but they wouldn't have any physical presence for the govt to try and force rules on them