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Full disclosure: I own about $11 worth of bitcoin if I round up a bit, so this might be biased. The most convincing "point" of bitcoin I've heard is to accomod

Full disclosure: I own about $11 worth of bitcoin if I round up a bit, so this might be biased. The most convincing "point" of bitcoin I've heard is to accomodate transfer of large sums of money across borders, quickly, with minimal transaction costs and oversight. Everyone here can afford the fee to transact 8 billion dollars worth of bitcoin. And settlement happens in seconds to a couple minutes. That's appealing to people trying to move millions or billions of dollars around.

systemvoltage 6y ago
That’s the thing. By the time the transfer takes place, BTC exchange rate is now 7% off. How convenient is the transfer mechanism when the underlying is a speculative instrument? Until BTC exchange rate gets stable or gets pegged do the ground, it’s gonna float around in the air of extreme volatility and manipulation - pretty risky adventure to transfer large sums of money.
- panarky 6y ago
  I prefer to own an asset with high volatility that gets more valuable over time than an asset with low volatility that gets less valuable over time.
  - adventured 6y ago
    You're talking about something entirely different from what the parent comment is. What you're talking about is a long-term investment.
  - edgyquant 6y ago
    We aren’t talking about assets and what you’ve just said is the reason we have controlled inflation. Currency isn’t supposed to incentivize hoarding it, quite the opposite in fact.
    - vntok 6y ago
      Not everyone agrees with that view. I for one would rather people spent their hard-earned money in a smart, slow and well-thought way than feel compelled by inflation to do so fast and lose.
      - pertymcpert 6y ago
        Yeah but that disincentivizes investments.
        vntok 6y ago
        Another way of looking at it: that incentivizes better investments.
        edgyquant 6y ago
        Not really. If you can earn risk free appreciation on a currency the smart thing to do is not spend it. This incentivizes hoarding money, not making smarter investments.
        vntok 6y ago
        Nope, you are therefore incentivized to spend that money in objects or services that will bring in more value to you than the risk-free "interest" or gains brought by the mere deflation. Ergo, smarter investments.
        pertymcpert 6y ago
        No, it disincentivizes investments full stop. People aren’t making dumb investments deliberately. You don’t get any new information about whether an investment is smart or not based on your currency being deflationary.
        vntok 6y ago
- spmurrayzzz 6y ago
  This is problematic for layer 1 settlement for sure. But there are layer 2 solutions that can help with the slippage issue (lightning network being the most prevalent). With a sufficient density of multisig wallet availability, as a proxy for liquidity, transactions are near-instant. That said, there are differences in settlement guarantees at layer 2 that might make certain use cases less optimal.
  - vineyardmike 6y ago
    > for layer 1 settlement for sure. But there are layer 2 layers?
    - jkepler 6y ago
      Sure. Layers, like the Internet is made up of protocol layers. Bitcoin on-chain is layer one: slow, sure, and after 6 confirmations considered irreversible and immutable. Layer 2 protocols would include the lightning network and the liquid bitcoin protocols - both systems designed for different use cases, with differing technological benefits and risks. There may be other layer 2 systems that I'm not aware of. Some might consider the OpenBazaar marketplace protocol, the Open Timestamps (https://opentimestamps.org/ https://opentimestamps.org/) application, or the Bisq decentralized bitcoin/fiat exchange to be layer 2 applications, as they're built directly on top of bitcoin but includes protocols. But I think they're simple examples of the kinds of applications that can be built on top of the programmable trust-net that bitcoin represents. Because bitcoin is a decentralized and permissionless technology protocol, anyone who thinks of a way to build on top of it can do so---without needing anyone else's permission. Layer 3 might be applications built on top of layer 2, such as the censorship resistant Juggernaut chat app, built on top of the lightning network: https://www.getjuggernaut.com/ https://www.getjuggernaut.com/. As layer 2 matures, I imagine we'll begin to see a wave of creativity unleashed globally as people create layer 3 applications.
    - spmurrayzzz 6y ago
      Yea this terminology is borrowed from the OSI model for networking, with which you're likely familiar. It originally was used as just an analogy, but has increasingly just become the way the space describes (and markets) the different protocol layers of cryptocurrencies generally.
cortesoft 6y ago
The price volatility is way more expensive than transaction cost, if you have billions of dollars.
- ad31mar 6y ago
  It's usually in your favour tho. Anyways, there are plenty of stablecoins if that's your thing and you can use Bitcoin (the network) for the rails only.
  - cortesoft 6y ago
    I don’t think I’d be making decisions on risk for BILLIONS of dollars based on something “usually” being in my favor. Also, stablecoins staying “stable” is a huge risk you are taking on if you use them. Again, if you have billions of dollars, you are going to be doing a lot more risk analysis and want a lot less uncertainty than you are going to get with any sort of cryptocurrency that exists today.
u678u 6y ago
No if you have millions or billions basic wire transfers are instant and cheap. It is more interesting for if you have a few hundred or a few thousand dollars, where a $10-$50 fee is significant. Or you want to bypass regulations or bureaucracy eg send money to a friend in Argentina or Lebanon which have currency controls.
- whatshisface 6y ago
  Bitcoin's use as a way of bypassing currency controls is one of the best arguments against it, because governments, already prone to suspicion towards anything that might upset their monetary policy, will have no quarter towards anything that upsets their laws.
  - Alupis 6y ago
    That, and folks like Elon Musk perpetrating blatant Pump 'n Dump Schemes[1]. Eventually it'll be regulated after a bunch of opportunistic "investors" get hosed - which ironically, will make the dump even worse. [1] https://www.valuethemarkets.com/2021/02/09/if-dogecoin-is-a-joke-why-is-elon-musk-pumping-this-meme-cryptocurrency/ https://www.valuethemarkets.com/2021/02/09/if-dogecoin-is-a-...
    - cacarr 6y ago
      The dump doesn't seem to have happened yet, though. DOGE has stabilized at about $.07, down from ~$.08.
  - red_trumpet 6y ago
    That's just not true. Every Bitcoin transaction is conserved in the blockchain, so a government can easily reconstruct the money flow.
    - smartties 6y ago
      And the transactions made on the exchange ? and decentralized exchange ? Can they all be tracked and reconstructed ?
blackbrokkoli 6y ago
Yeah, sure settlement in Bitcoin happens within a few minutes. Getting that converted into usable money is a whole other story, no? I can basically think of two scenario types when you are in need of international, spontaneous money transfer: a) "I just got carjacked in Sierra Leone and need some money for an hotel and a flight home" b) "I have some weird novel business and I would like to pay my contractors in East Timor biweekly" I cannot image using Bitcoin for either, first one because of the convert-to-money-thing, second one because of the volatility. There is also some kind of - how do you call this - meta-trust that I just don't have in Bitcoin: Go off-grid for two weeks and there is a non trivial chance that some weird shit happened within crypto that is now an obstacle (crash or rally, outlawing, split, ...). That does not happen with US dollars. I got the feeling that this is yet another incredibly obscure use case that doesn't even really work Bitcoin fanatics (not directed at the quite reasonable parent comment) use to justify their gambling and Lambo-dreams. Just like "it could be the new gold" or "what if the US gov collapses". But I am certainly no expert in international money transfer by any means, so feel free to change my mind!
- FalconSensei 6y ago
  > Go off-grid for two weeks and there is a non trivial chance that some weird shit happened within crypto that is now an obstacle For people in countries with a more stable economy/currency, this is very true. Even in countries with a bigger inflation, things are a bit more predictable. But of course, different countries/economies/currencies have different realities.
- throw89323432 6y ago
  I had contractor on Litecoin in Russia for 6 months. Worked pretty well.
  - faffe 6y ago
    Out of curiosity, can I know why you did use Litecoin rather than others crypto???
    - 6y ago
ska 6y ago
I've never understood this argument. Moving large amounts of one currency between countries isn't expensive or slow (relative to how quickly you typically need to do this). Assuming you are allowed to do it at all. Oversight is a different story, but there aren't many legitimate reasons to want to do that (probably none that aren't problematic). There are, of course, a ton of illegitimate reasons but that's a different conversation. Getting that 1mm+ from one currency to another is a whole different story, but that story only gets worse if you involve crypto. Paying $40 in wire fees to move $200 sucks, but it's just not an issue on large transactions. So I think your real use case is lots of small transactions, not a few big ones. And unless you can spend the crypto directly, the volatility can kill this application pretty easily. What am I missing?
- irae 6y ago
  It is not that simple once you cross borders to countries USD is used by all kinds of criminals. When you have honest business, you are screwed by the system. Here in Brazil, getting money in and out is a nightmare if above 5k USD. I live in Brazil and work for a US company. My first month payment took 3 months to clear, and because of 3 accumulated payments I got audited and the 4th pay got delayed again. The first one that cleared in 3 days was the 6th payment. All payments were charged 40 USD to my employer, but 20 was charged by middle man every month. I also have a US based health insurance but (again) I currently live in Brazil. I had a surgery reimbursement be withheld for 65 days, I had to send dozens of documents and when they finally cleared, I had not only lost to exchange rates, on middle man bank took 20 USD and my branch in Brazil took an extra 170 USD.
- MrMan 6y ago
  I get free wire transfers at my bank
sorbits 6y ago
> And settlement happens in seconds to a couple minutes That is incorrect. On average it takes 10 minutes to mine a block, but you have to submit the transaction to be included in the block, so > 10 minutes before it appears on the blockchain. However, there are actually many block chains, as miners creates block in parallel, it’s the longest one that is the “official”, but the minute you see your transaction in a block, you do not know if this block will stay in the longest chain, so in general you want at least 5 new blocks, after your block, before it is considered “safe”. So now we are talking about one hour to do a transaction, and that assumes that the network is not overloaded, because there is also a cap on number of transactions that can be included in a block. All in all, it is a terrible system for fast transactions.
- FalconSensei 6y ago
  Awesome, go to the supermarket, pay with BTC and wait there for an hour for your transaction to complete. Or try to buy anything time/quantity limited, so you don't get it because the transaction took too long to complete. Meanwhile, in Canada, I just do a money transfer by email without any fees (if sending more than $10), and it's almost instant if the receiver have auto-deposit set up.
  - sizzle 6y ago
    Why would you have to wait an hour? A credit card isn't instant? Isn't there some level of trust involved here?
    - imtringued 6y ago
      You won't have to wait an hour because MasterCard will support Bitcoin. However, this completely goes against the idea of decentralization.
      - faffe 6y ago
        Actually the article mention " select crypto" but not the BTC. And to be honest I do not see the point for them to support a decentralised currency like. just complying with the regulatory rules ( KYC, anti Money laundering,etc...) Would be a real nightmare
kelnos 6y ago
People who want to move millions or billions of dollars around don't care about a $30 wire fee. What they do care about is recourse in the case of fraud or mistakes, which Bitcoin by design does not give you. Moving large amount of money without government interference, however, is certainly a feature of Bitcoin that fiat currency usually doesn't have. And there are some (though perhaps not many?) non-shady reasons why someone might want this.
- MrMan 6y ago
  By the time recourse and other modern financial conveniences are built on btc it will lose its luster for the hucksters
mancerayder 6y ago
Forget million and billions. Hasn't anyone on this thread lived and worked abroad? Transferring 10s of thousands from the US to the EU or vice versa costs a ton in the banks skimming off the back of exchange rates that they choose and fees. There are ways to do it via trading accounts but it's a pain.
- louloulou 6y ago
  It's actually pretty cheap and easy these days with a transferwise account. But I agree, it used to be a massive pain, and still is for smaller currencies or more closed-off banking systems like japan.

systemvoltage 6y ago

That’s the thing. By the time the transfer takes place, BTC exchange rate is now 7% off. How convenient is the transfer mechanism when the underlying is a speculative instrument? Until BTC exchange rate gets stable or gets pegged do the ground, it’s gonna float around in the air of extreme volatility and manipulation - pretty risky adventure to transfer large sums of money.

panarky 6y ago
I prefer to own an asset with high volatility that gets more valuable over time than an asset with low volatility that gets less valuable over time.
- adventured 6y ago
  You're talking about something entirely different from what the parent comment is. What you're talking about is a long-term investment.
- edgyquant 6y ago
  We aren’t talking about assets and what you’ve just said is the reason we have controlled inflation. Currency isn’t supposed to incentivize hoarding it, quite the opposite in fact.
  - vntok 6y ago
    Not everyone agrees with that view. I for one would rather people spent their hard-earned money in a smart, slow and well-thought way than feel compelled by inflation to do so fast and lose.
    - pertymcpert 6y ago
      Yeah but that disincentivizes investments.
      - vntok 6y ago
        Another way of looking at it: that incentivizes better investments.
        edgyquant 6y ago
        Not really. If you can earn risk free appreciation on a currency the smart thing to do is not spend it. This incentivizes hoarding money, not making smarter investments.
        vntok 6y ago
        Nope, you are therefore incentivized to spend that money in objects or services that will bring in more value to you than the risk-free "interest" or gains brought by the mere deflation. Ergo, smarter investments.
        pertymcpert 6y ago
        No, it disincentivizes investments full stop. People aren’t making dumb investments deliberately. You don’t get any new information about whether an investment is smart or not based on your currency being deflationary.
        vntok 6y ago
spmurrayzzz 6y ago
This is problematic for layer 1 settlement for sure. But there are layer 2 solutions that can help with the slippage issue (lightning network being the most prevalent). With a sufficient density of multisig wallet availability, as a proxy for liquidity, transactions are near-instant. That said, there are differences in settlement guarantees at layer 2 that might make certain use cases less optimal.
- vineyardmike 6y ago
  > for layer 1 settlement for sure. But there are layer 2 layers?
  - jkepler 6y ago
    Sure. Layers, like the Internet is made up of protocol layers. Bitcoin on-chain is layer one: slow, sure, and after 6 confirmations considered irreversible and immutable. Layer 2 protocols would include the lightning network and the liquid bitcoin protocols - both systems designed for different use cases, with differing technological benefits and risks. There may be other layer 2 systems that I'm not aware of. Some might consider the OpenBazaar marketplace protocol, the Open Timestamps (https://opentimestamps.org/ https://opentimestamps.org/) application, or the Bisq decentralized bitcoin/fiat exchange to be layer 2 applications, as they're built directly on top of bitcoin but includes protocols. But I think they're simple examples of the kinds of applications that can be built on top of the programmable trust-net that bitcoin represents. Because bitcoin is a decentralized and permissionless technology protocol, anyone who thinks of a way to build on top of it can do so---without needing anyone else's permission. Layer 3 might be applications built on top of layer 2, such as the censorship resistant Juggernaut chat app, built on top of the lightning network: https://www.getjuggernaut.com/ https://www.getjuggernaut.com/. As layer 2 matures, I imagine we'll begin to see a wave of creativity unleashed globally as people create layer 3 applications.
  - spmurrayzzz 6y ago
    Yea this terminology is borrowed from the OSI model for networking, with which you're likely familiar. It originally was used as just an analogy, but has increasingly just become the way the space describes (and markets) the different protocol layers of cryptocurrencies generally.

cortesoft 6y ago

The price volatility is way more expensive than transaction cost, if you have billions of dollars.

ad31mar 6y ago
It's usually in your favour tho. Anyways, there are plenty of stablecoins if that's your thing and you can use Bitcoin (the network) for the rails only.
- cortesoft 6y ago
  I don’t think I’d be making decisions on risk for BILLIONS of dollars based on something “usually” being in my favor. Also, stablecoins staying “stable” is a huge risk you are taking on if you use them. Again, if you have billions of dollars, you are going to be doing a lot more risk analysis and want a lot less uncertainty than you are going to get with any sort of cryptocurrency that exists today.

u678u 6y ago

No if you have millions or billions basic wire transfers are instant and cheap. It is more interesting for if you have a few hundred or a few thousand dollars, where a $10-$50 fee is significant. Or you want to bypass regulations or bureaucracy eg send money to a friend in Argentina or Lebanon which have currency controls.

whatshisface 6y ago
Bitcoin's use as a way of bypassing currency controls is one of the best arguments against it, because governments, already prone to suspicion towards anything that might upset their monetary policy, will have no quarter towards anything that upsets their laws.
- Alupis 6y ago
  That, and folks like Elon Musk perpetrating blatant Pump 'n Dump Schemes[1]. Eventually it'll be regulated after a bunch of opportunistic "investors" get hosed - which ironically, will make the dump even worse. [1] https://www.valuethemarkets.com/2021/02/09/if-dogecoin-is-a-joke-why-is-elon-musk-pumping-this-meme-cryptocurrency/ https://www.valuethemarkets.com/2021/02/09/if-dogecoin-is-a-...
  - cacarr 6y ago
    The dump doesn't seem to have happened yet, though. DOGE has stabilized at about $.07, down from ~$.08.
- red_trumpet 6y ago
  That's just not true. Every Bitcoin transaction is conserved in the blockchain, so a government can easily reconstruct the money flow.
  - smartties 6y ago
    And the transactions made on the exchange ? and decentralized exchange ? Can they all be tracked and reconstructed ?

blackbrokkoli 6y ago

Yeah, sure settlement in Bitcoin happens within a few minutes. Getting that converted into usable money is a whole other story, no? I can basically think of two scenario types when you are in need of international, spontaneous money transfer: a) "I just got carjacked in Sierra Leone and need some money for an hotel and a flight home" b) "I have some weird novel business and I would like to pay my contractors in East Timor biweekly" I cannot image using Bitcoin for either, first one because of the convert-to-money-thing, second one because of the volatility. There is also some kind of - how do you call this - meta-trust that I just don't have in Bitcoin: Go off-grid for two weeks and there is a non trivial chance that some weird shit happened within crypto that is now an obstacle (crash or rally, outlawing, split, ...). That does not happen with US dollars. I got the feeling that this is yet another incredibly obscure use case that doesn't even really work Bitcoin fanatics (not directed at the quite reasonable parent comment) use to justify their gambling and Lambo-dreams. Just like "it could be the new gold" or "what if the US gov collapses". But I am certainly no expert in international money transfer by any means, so feel free to change my mind!

FalconSensei 6y ago
> Go off-grid for two weeks and there is a non trivial chance that some weird shit happened within crypto that is now an obstacle For people in countries with a more stable economy/currency, this is very true. Even in countries with a bigger inflation, things are a bit more predictable. But of course, different countries/economies/currencies have different realities.
throw89323432 6y ago
I had contractor on Litecoin in Russia for 6 months. Worked pretty well.
- faffe 6y ago
  Out of curiosity, can I know why you did use Litecoin rather than others crypto???
  - 6y ago

ska 6y ago

I've never understood this argument. Moving large amounts of one currency between countries isn't expensive or slow (relative to how quickly you typically need to do this). Assuming you are allowed to do it at all. Oversight is a different story, but there aren't many legitimate reasons to want to do that (probably none that aren't problematic). There are, of course, a ton of illegitimate reasons but that's a different conversation. Getting that 1mm+ from one currency to another is a whole different story, but that story only gets worse if you involve crypto. Paying $40 in wire fees to move $200 sucks, but it's just not an issue on large transactions. So I think your real use case is lots of small transactions, not a few big ones. And unless you can spend the crypto directly, the volatility can kill this application pretty easily. What am I missing?

irae 6y ago
It is not that simple once you cross borders to countries USD is used by all kinds of criminals. When you have honest business, you are screwed by the system. Here in Brazil, getting money in and out is a nightmare if above 5k USD. I live in Brazil and work for a US company. My first month payment took 3 months to clear, and because of 3 accumulated payments I got audited and the 4th pay got delayed again. The first one that cleared in 3 days was the 6th payment. All payments were charged 40 USD to my employer, but 20 was charged by middle man every month. I also have a US based health insurance but (again) I currently live in Brazil. I had a surgery reimbursement be withheld for 65 days, I had to send dozens of documents and when they finally cleared, I had not only lost to exchange rates, on middle man bank took 20 USD and my branch in Brazil took an extra 170 USD.
MrMan 6y ago
I get free wire transfers at my bank

sorbits 6y ago

> And settlement happens in seconds to a couple minutes That is incorrect. On average it takes 10 minutes to mine a block, but you have to submit the transaction to be included in the block, so > 10 minutes before it appears on the blockchain. However, there are actually many block chains, as miners creates block in parallel, it’s the longest one that is the “official”, but the minute you see your transaction in a block, you do not know if this block will stay in the longest chain, so in general you want at least 5 new blocks, after your block, before it is considered “safe”. So now we are talking about one hour to do a transaction, and that assumes that the network is not overloaded, because there is also a cap on number of transactions that can be included in a block. All in all, it is a terrible system for fast transactions.

FalconSensei 6y ago
Awesome, go to the supermarket, pay with BTC and wait there for an hour for your transaction to complete. Or try to buy anything time/quantity limited, so you don't get it because the transaction took too long to complete. Meanwhile, in Canada, I just do a money transfer by email without any fees (if sending more than $10), and it's almost instant if the receiver have auto-deposit set up.
- sizzle 6y ago
  Why would you have to wait an hour? A credit card isn't instant? Isn't there some level of trust involved here?
  - imtringued 6y ago
    You won't have to wait an hour because MasterCard will support Bitcoin. However, this completely goes against the idea of decentralization.
    - faffe 6y ago
      Actually the article mention " select crypto" but not the BTC. And to be honest I do not see the point for them to support a decentralised currency like. just complying with the regulatory rules ( KYC, anti Money laundering,etc...) Would be a real nightmare

kelnos 6y ago

People who want to move millions or billions of dollars around don't care about a $30 wire fee. What they do care about is recourse in the case of fraud or mistakes, which Bitcoin by design does not give you. Moving large amount of money without government interference, however, is certainly a feature of Bitcoin that fiat currency usually doesn't have. And there are some (though perhaps not many?) non-shady reasons why someone might want this.

MrMan 6y ago
By the time recourse and other modern financial conveniences are built on btc it will lose its luster for the hucksters

mancerayder 6y ago

Forget million and billions. Hasn't anyone on this thread lived and worked abroad? Transferring 10s of thousands from the US to the EU or vice versa costs a ton in the banks skimming off the back of exchange rates that they choose and fees. There are ways to do it via trading accounts but it's a pain.

louloulou 6y ago
It's actually pretty cheap and easy these days with a transferwise account. But I agree, it used to be a massive pain, and still is for smaller currencies or more closed-off banking systems like japan.