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Fun trivia: Brian Armstrong was looking for a co-founder on HN back in 2012: https://news.ycombinator.com/item?id=3754664 https://news.ycombinator.com/item?id=3

Fun trivia: Brian Armstrong was looking for a co-founder on HN back in 2012: https://news.ycombinator.com/item?id=3754664 https://news.ycombinator.com/item?id=3754664

sneak 6y ago
I spoke to him on the phone within a few hours of that post, as I had already prototyped an app to do what was described. I didn't launch mine, nor participate in his (obviously). I suggested that a business in that space, if successful, would result in a similar outcome as happened to other founders of international money transmission systems that weren't under direct government control: i.e. swatting. He was not dissuaded, to his credit. Score one for the "founders must have grit" camp. To be honest, I'm still not sure why the hammer hasn't come down on something like Coinbase by now. It seems that cryptocurrencies in general are the exact opposite of the regime outlined by the BSA, PATRIOT, et c. My unsubstantiated theory is that it has something to do with pmarca, but that's just a guess. The founder of Kraken has expressed his feelings that it's coming soon. I'm glad that Coinbase has permitted so many to participate in the ecosystem, but I wonder about how much of a benefit heavily regulated, custodial wallets bring to the ecosystem as a whole. It seems to me that Bitcoin existed to replace banks, and here we have a bank serving as the Bitcoin equivalent of gmail, re-centralizing everything in a place that is easily and instantly censored by the exact system it was built to replace. The fact that they're listed on a stock exchange and not as an ERC-20 or other permissionless token tells the whole story, in my view. I have a special respect for those who can function in heavily regulated, guilty-until-proven-innocent style markets like financial services in the USA. I personally would not be able to handle it.
- robocat 6y ago
  > I'm still not sure why the hammer hasn't come down on something like Coinbase by now Perhaps you have a answered yourself: “re-centralizing everything in a place that is easily and instantly censored by the exact system it was built to replace”.
  - sneak 6y ago
    If compromising the permissionlessness of Bitcoin is the only way for Bitcoin to come to a certain market, then perhaps it would be better for companies like Coinbase not to exist, and people who want to use Bitcoin should have to take the steps involved in self-custody. To me, it's a shame to see. Now that Gmail and Coinbase have captured so much of their markets, they (or anyone who can coerce them) are now free to start censoring what goes in or out, turning a federated, permissionless system into effectively a dictatorship. https://cryptobriefing.com/bitstamp-begins-track-off-exchange-addresses/ https://cryptobriefing.com/bitstamp-begins-track-off-exchang... I really hope that's not what ends up happening. It's a bummer that financial services in the global west engage in such legally-mandated gatekeeping, locking billions out of the most lucrative payments markets. The internet and cryptocurrencies present a new opportunity there, and re-using the same decades old regulation to segregate the technology into the haves and have-nots is, to me, a tragedy.
    - rawtxapp 6y ago
      The coins stored on Coinbase (and other crypto exchanges for that matter) are at all time lows, people are self-custodying their coins and using them on decentralized protocols where they don't have to trust centralized 3rd parties. Coinbase is just one player in the whole space.
      - spurdoman77 6y ago
        Coinbase is custodying 760k BTC or so... thats more than 5% of all BTC in existence.
        FabHK 6y ago
        They claimed that they were holding about 11% of crypto market cap on their exchange.
      - sneak 6y ago
        I hope you're a) right, and b) it stays that way. I fear that neither is true.
- dd36 6y ago
  If the last few decades tell us anything, it’s once you’re large and have a lot employees, you’re above any regulation that would put you out of business. Slaps on the wrist are the worst you can expect.
  - renewiltord 6y ago
    Backpage was pretty big when it was deep sixed by the Feds.
    - dd36 6y ago
      Did Backpage have institutional money behind it?
      - riffraff 6y ago
        Wirecard did.
  - sneak 6y ago
    My hunch is that it has more to do with the amount of money you've taken from prominent/powerful/connected Rich Guys than how strictly large you are or how many you employ. There's a lot of hidden soft power in the USA amongst the ultra-wealthy, I've come to learn. (Note that this is not a criticism specifically against Coinbase, per se; more an indictment of the lack of equal protection under the law in the USA in general. All animals are equal, but some animals are more equal than others.)
  - alvah 6y ago
    Arthur Andersen and their ~85,000 employees would like a word.
    - piva00 6y ago
      After rubber stamping the squandering of California's energy market into a complete fraud of a company. I think that's a very high bar to cross, requiring damaging a lot of rich people in the process to call attention to it, to be punished.
- swensel 6y ago
  You see no benefit to a flat system in crypto where everyone can participate equally, vs traditional finance / stock brokerages where large institutions like hedge funds automatically get a better deal vs any retail trader?
- st1ck 6y ago
  Charlie Shrem (BitInstant) was a bit less lucky, or maybe it was "too early"?
  - deleted 6y ago
    [deleted]
- GoblinSlayer 6y ago
  >censored by the exact system it was built to replace Bitcoin was designed to replace fiat money, it can't replace swats.
deviation 6y ago
Credit to him for following through with his vision, and standing his ground in his replies to all the comments in that thread. Looking back now, it's certainly evidence of a group bias and the "If the opportunity was that great, X company would be doing it by now" way of thinking. Props are owed for bringing some true innovation to the space. I'd love to know how this turned out. Did he eventually find a co-founder? Or did he continue in his YC application as a sole-founder? For those that don't want to click through: There are replies in that thread such as.. - "No thanks. I'd rather sell sugared water." - "Because bitcoin worked out so well. Have fun with that, dude."
- joering2 6y ago
  How did he follow thru with his vision? Read his other comments to get better picture - he was angry at the system of Credit Cards, PayPals etc that charge outraged fees just to be able to use their network. He wanted to build network that performs exchange at zero fee. Instead, he ended up building and owning one of the most expensive crypto exchanges in the USA. Sure props to him to pull it off, you don't get net worth of $20B by accident or pure luck... but in terms of his vision of the world more united where it is easier to send and receive money without paying outrages fees, he definitely failed on that promise.
  - smnplk 6y ago
    >> but in terms of his vision of the world more united where it is easier to send and receive money without paying outrages fees, he definitely failed on that promise. << It was Bitcoin that failed to deliver that promise, not him.
    - seriousquestion 6y ago
      Or both. Bitcoin and Coinbase each have outrageous fees.
      - spurdoman77 6y ago
        Depends on the kind of transaction you are doing. For bigger transactions it is actually nice not having to pay percentual fee as with Bitcoin. However with coinbase I believe they are high percentually.
seanarnold 6y ago
kinda ironic how in his post he's trying to compete on fees
- solumos 6y ago
  And then someone says "just look at Square or Venmo, they do fine connecting to your bank or whatever, adding Bitcoin to the mix just adds another layer of complication"
- vmception 6y ago
  Coinbase doesnt have 2.5% fees so it is ironic that it is extremely competitive Their retail platform has a 1% withdrawal fee unless you are using USDC in which case it is 0% And their trading platforms have 20 basis points and less commissions
  - anonymoushn 6y ago
    Coinbase charges a spread of about one-half of one percent (0.50%) for cryptocurrency purchases and cryptocurrency sales. However, the actual spread may be higher or lower due to market fluctuations in the price of cryptocurrency on Coinbase Pro between the time we quote a price and the time when the order executes. We also charge a Coinbase Fee (in addition to the spread), which is the greater of (a) a flat fee or (b) a variable percentage fee determined by region, product feature, and payment type. The flat fees are set forth below: If the total transaction amount is less than or equal to $10, the fee is $0.99 If the total transaction amount is more than $10 but less than or equal to $25, the fee is $1.49 If the total transaction amount is more than $25 but less than or equal to $50, the fee is $1.99 If the total transaction amount is more than $50 but less than or equal to $200, the fee is $2.99 Edit: There's another section about how they charge 4% to deposit dollars unless you use ACH (and wait 1 week) or wire transfer (then they charge you $10 to deposit or $25 to withdraw)
archon810 6y ago
https://news.ycombinator.com/item?id=3755073 https://news.ycombinator.com/item?id=3755073 I wonder if he's kicking himself now for not taking the job.
thinking12333 6y ago
Amazing to see. But what I find interesting is that his vision was way off- crypto is nowhere near replacing credit cards, now or in the future. But he did build a huge company because crypto became a speculative asset bubble instead.
- eru 6y ago
  Scott Sumner has an interesting argument that it's not a bubble. Similar for the so called 'tech bubble' around the start of the millennium: if you bought all the tech stocks back then and held them until today, you would have made an OK return. (Of course, many companies have gone out of business, but there were a few outsized winners to make up for it. Any individual tech stock was extremely risky, but the overall sentiment that 'tech is the future' was right on the money. If anything, it's not the high valuations of the 'dot-com bubble' that seem off, but the low valuations of the bust.
  - gogopuppygogo 6y ago
    Except 75% or so of this bubble is mined in China and more American firms keep buying into it... This story doesn’t likely have a happy ending.
    - rocho 6y ago
      Plus all the Tether shady stuff.
    - bdamm 6y ago
      "China" isn't one people either.
    - swensel 6y ago
      Why doesn't it have a happy ending?
    - berkes 6y ago
      Proof of Work crypto is mined where energy is cheap. And energy is cheap where it is subsidised or in abundance. The first is often 'China'. The second, currently often hydro. A lot of mining is now moving to Iceland, Canada etc. Where energy is becoming cheaper than CPC funded energy.
aazaa 6y ago
Some observations: 1. Armstrong was so concerned about privacy that he used a throwaway, but ended up giving his identity away anyway. 2. Those responses! The negativity on Bitcoin has been there from the start on HN especially for some reason. 3. That whole payment angle has not worked out the way most people thought. Most enthusiasts in 2012 saw Bitcoin as a PayPal replacement. Instead, Bitcoin has taking its own path, confounding the predictions of skeptics, professional economists, and enthusiasts alike.
- morpheos137 6y ago
  1. See 2. 2. Bitcoin was always a dumb idea from the perspective of building a business or an economy on it. 3. Anyone who really looked at Bitcoin in 2012 could see it was not a realistic replacement for PayPal unless you were thinking about paying on a place like SilkRoad.
  - GoblinSlayer 6y ago
    Fiat systems have such infernal UX, bitcoin can win on that metric alone. The FUD spread by the regulator is the only reason we're here.
    - morpheos137 6y ago
      By infernal you mean they comply with AML regulations like KYC? Not following the law is not a "metric" legitimate businesses usually brag about. Anybody who use FUD as an argument for something is pushing some kind of snake oil. FUD stands for "Fear, uncertainty, doubt." Why does FUD exist? Because historically when we did dumb things there were consequences. Is fearing consequences an irrational thing?
datalus 6y ago
2nd post down... doxxed ooof.
deleted 6y ago
[deleted]
quickthrower2 6y ago
Ah the good old days, when people talked about Bitcoin solving too high credit card fees. It’s now $15+ per transaction in fees but it’s now a store of value so it doesn’t matter!
- spurdoman77 6y ago
  Thats cheap transaction fee for buying my yacht or private island with BTC
- anonymoushn 6y ago
  There are other cryptocurrencies that have higher tps and lower per-transaction fees. Bitcoin has low transaction fees compared to US domestic wire transfers or compared to using a credit card on a purchase of $1000 or more.
- CraigRood 6y ago
  The $15 is debatable, mempool.space is closer to $5 for confirming within 60 minutes, which is many factors faster than what Mastercard do in the traditional world. I would argue though that the magic of Crypto isn't buying coffees. After Silkroad we have seen very little interest in using Crypto as money, and even with "high" fees, alternatives have not become desirable for their ability to transact cheaply. I would also point out that even the likes of Coinbase have a 0.5% fee before spreads. Using crypto over cash or card (at least in Europe) isn't a cheaper of faster process end to end. IMHO Bitcoin IS an offshore account, and the ability to move wealth anywhere in the world, without a middle man, entirely permission-less and trust-less for even at $15 is a massive achievement. Don't get me wrong, it can be cheaper, but what Bitcoin can do, and how individuals from retail investors to publicly listed companies are holding Bitcoin its a massive signal in terms of whats actually desired.
650REDHAIR 6y ago
Threads like that are a big reason I'm not very active here on HN anymore. So much negativity masquerading as "constructive feedback".
deleted 6y ago
[deleted]
ckue 6y ago
Pretty sure ijoey on this thread is a time traveller, as BTC/USD reached $60k when Coinbase IPO'd > Boy. This is the 60000 dollar question isn't it? Who wants to be my partner? Good luck. I really hope you find them. Taking on the credit card industry is going to be awesome! https://news.ycombinator.com/item?id=3754835 https://news.ycombinator.com/item?id=3754835

Fun trivia: Brian Armstrong was looking for a co-founder on HN back in 2012: https://news.ycombinator.com/item?id=3754664 https://news.ycombinator.com/item?id=3754664

sneak 6y ago

I spoke to him on the phone within a few hours of that post, as I had already prototyped an app to do what was described. I didn't launch mine, nor participate in his (obviously). I suggested that a business in that space, if successful, would result in a similar outcome as happened to other founders of international money transmission systems that weren't under direct government control: i.e. swatting. He was not dissuaded, to his credit. Score one for the "founders must have grit" camp. To be honest, I'm still not sure why the hammer hasn't come down on something like Coinbase by now. It seems that cryptocurrencies in general are the exact opposite of the regime outlined by the BSA, PATRIOT, et c. My unsubstantiated theory is that it has something to do with pmarca, but that's just a guess. The founder of Kraken has expressed his feelings that it's coming soon. I'm glad that Coinbase has permitted so many to participate in the ecosystem, but I wonder about how much of a benefit heavily regulated, custodial wallets bring to the ecosystem as a whole. It seems to me that Bitcoin existed to replace banks, and here we have a bank serving as the Bitcoin equivalent of gmail, re-centralizing everything in a place that is easily and instantly censored by the exact system it was built to replace. The fact that they're listed on a stock exchange and not as an ERC-20 or other permissionless token tells the whole story, in my view. I have a special respect for those who can function in heavily regulated, guilty-until-proven-innocent style markets like financial services in the USA. I personally would not be able to handle it.

robocat 6y ago
> I'm still not sure why the hammer hasn't come down on something like Coinbase by now Perhaps you have a answered yourself: “re-centralizing everything in a place that is easily and instantly censored by the exact system it was built to replace”.
- sneak 6y ago
  If compromising the permissionlessness of Bitcoin is the only way for Bitcoin to come to a certain market, then perhaps it would be better for companies like Coinbase not to exist, and people who want to use Bitcoin should have to take the steps involved in self-custody. To me, it's a shame to see. Now that Gmail and Coinbase have captured so much of their markets, they (or anyone who can coerce them) are now free to start censoring what goes in or out, turning a federated, permissionless system into effectively a dictatorship. https://cryptobriefing.com/bitstamp-begins-track-off-exchange-addresses/ https://cryptobriefing.com/bitstamp-begins-track-off-exchang... I really hope that's not what ends up happening. It's a bummer that financial services in the global west engage in such legally-mandated gatekeeping, locking billions out of the most lucrative payments markets. The internet and cryptocurrencies present a new opportunity there, and re-using the same decades old regulation to segregate the technology into the haves and have-nots is, to me, a tragedy.
  - rawtxapp 6y ago
    The coins stored on Coinbase (and other crypto exchanges for that matter) are at all time lows, people are self-custodying their coins and using them on decentralized protocols where they don't have to trust centralized 3rd parties. Coinbase is just one player in the whole space.
    - spurdoman77 6y ago
      Coinbase is custodying 760k BTC or so... thats more than 5% of all BTC in existence.
      - FabHK 6y ago
        They claimed that they were holding about 11% of crypto market cap on their exchange.
    - sneak 6y ago
      I hope you're a) right, and b) it stays that way. I fear that neither is true.
dd36 6y ago
If the last few decades tell us anything, it’s once you’re large and have a lot employees, you’re above any regulation that would put you out of business. Slaps on the wrist are the worst you can expect.
- renewiltord 6y ago
  Backpage was pretty big when it was deep sixed by the Feds.
  - dd36 6y ago
    Did Backpage have institutional money behind it?
    - riffraff 6y ago
      Wirecard did.
- sneak 6y ago
  My hunch is that it has more to do with the amount of money you've taken from prominent/powerful/connected Rich Guys than how strictly large you are or how many you employ. There's a lot of hidden soft power in the USA amongst the ultra-wealthy, I've come to learn. (Note that this is not a criticism specifically against Coinbase, per se; more an indictment of the lack of equal protection under the law in the USA in general. All animals are equal, but some animals are more equal than others.)
- alvah 6y ago
  Arthur Andersen and their ~85,000 employees would like a word.
  - piva00 6y ago
    After rubber stamping the squandering of California's energy market into a complete fraud of a company. I think that's a very high bar to cross, requiring damaging a lot of rich people in the process to call attention to it, to be punished.
swensel 6y ago
You see no benefit to a flat system in crypto where everyone can participate equally, vs traditional finance / stock brokerages where large institutions like hedge funds automatically get a better deal vs any retail trader?
st1ck 6y ago
Charlie Shrem (BitInstant) was a bit less lucky, or maybe it was "too early"?
- deleted 6y ago
  [deleted]
GoblinSlayer 6y ago
>censored by the exact system it was built to replace Bitcoin was designed to replace fiat money, it can't replace swats.

deviation 6y ago

Credit to him for following through with his vision, and standing his ground in his replies to all the comments in that thread. Looking back now, it's certainly evidence of a group bias and the "If the opportunity was that great, X company would be doing it by now" way of thinking. Props are owed for bringing some true innovation to the space. I'd love to know how this turned out. Did he eventually find a co-founder? Or did he continue in his YC application as a sole-founder? For those that don't want to click through: There are replies in that thread such as.. - "No thanks. I'd rather sell sugared water." - "Because bitcoin worked out so well. Have fun with that, dude."

joering2 6y ago
How did he follow thru with his vision? Read his other comments to get better picture - he was angry at the system of Credit Cards, PayPals etc that charge outraged fees just to be able to use their network. He wanted to build network that performs exchange at zero fee. Instead, he ended up building and owning one of the most expensive crypto exchanges in the USA. Sure props to him to pull it off, you don't get net worth of $20B by accident or pure luck... but in terms of his vision of the world more united where it is easier to send and receive money without paying outrages fees, he definitely failed on that promise.
- smnplk 6y ago
  >> but in terms of his vision of the world more united where it is easier to send and receive money without paying outrages fees, he definitely failed on that promise. << It was Bitcoin that failed to deliver that promise, not him.
  - seriousquestion 6y ago
    Or both. Bitcoin and Coinbase each have outrageous fees.
    - spurdoman77 6y ago
      Depends on the kind of transaction you are doing. For bigger transactions it is actually nice not having to pay percentual fee as with Bitcoin. However with coinbase I believe they are high percentually.

seanarnold 6y ago

kinda ironic how in his post he's trying to compete on fees

solumos 6y ago
And then someone says "just look at Square or Venmo, they do fine connecting to your bank or whatever, adding Bitcoin to the mix just adds another layer of complication"
vmception 6y ago
Coinbase doesnt have 2.5% fees so it is ironic that it is extremely competitive Their retail platform has a 1% withdrawal fee unless you are using USDC in which case it is 0% And their trading platforms have 20 basis points and less commissions
- anonymoushn 6y ago
  Coinbase charges a spread of about one-half of one percent (0.50%) for cryptocurrency purchases and cryptocurrency sales. However, the actual spread may be higher or lower due to market fluctuations in the price of cryptocurrency on Coinbase Pro between the time we quote a price and the time when the order executes. We also charge a Coinbase Fee (in addition to the spread), which is the greater of (a) a flat fee or (b) a variable percentage fee determined by region, product feature, and payment type. The flat fees are set forth below: If the total transaction amount is less than or equal to $10, the fee is $0.99 If the total transaction amount is more than $10 but less than or equal to $25, the fee is $1.49 If the total transaction amount is more than $25 but less than or equal to $50, the fee is $1.99 If the total transaction amount is more than $50 but less than or equal to $200, the fee is $2.99 Edit: There's another section about how they charge 4% to deposit dollars unless you use ACH (and wait 1 week) or wire transfer (then they charge you $10 to deposit or $25 to withdraw)

archon810 6y ago

https://news.ycombinator.com/item?id=3755073 https://news.ycombinator.com/item?id=3755073 I wonder if he's kicking himself now for not taking the job.

thinking12333 6y ago

Amazing to see. But what I find interesting is that his vision was way off- crypto is nowhere near replacing credit cards, now or in the future. But he did build a huge company because crypto became a speculative asset bubble instead.

eru 6y ago
Scott Sumner has an interesting argument that it's not a bubble. Similar for the so called 'tech bubble' around the start of the millennium: if you bought all the tech stocks back then and held them until today, you would have made an OK return. (Of course, many companies have gone out of business, but there were a few outsized winners to make up for it. Any individual tech stock was extremely risky, but the overall sentiment that 'tech is the future' was right on the money. If anything, it's not the high valuations of the 'dot-com bubble' that seem off, but the low valuations of the bust.
- gogopuppygogo 6y ago
  Except 75% or so of this bubble is mined in China and more American firms keep buying into it... This story doesn’t likely have a happy ending.
  - rocho 6y ago
    Plus all the Tether shady stuff.
  - bdamm 6y ago
    "China" isn't one people either.
  - swensel 6y ago
    Why doesn't it have a happy ending?
  - berkes 6y ago
    Proof of Work crypto is mined where energy is cheap. And energy is cheap where it is subsidised or in abundance. The first is often 'China'. The second, currently often hydro. A lot of mining is now moving to Iceland, Canada etc. Where energy is becoming cheaper than CPC funded energy.

aazaa 6y ago

Some observations: 1. Armstrong was so concerned about privacy that he used a throwaway, but ended up giving his identity away anyway. 2. Those responses! The negativity on Bitcoin has been there from the start on HN especially for some reason. 3. That whole payment angle has not worked out the way most people thought. Most enthusiasts in 2012 saw Bitcoin as a PayPal replacement. Instead, Bitcoin has taking its own path, confounding the predictions of skeptics, professional economists, and enthusiasts alike.

morpheos137 6y ago
1. See 2. 2. Bitcoin was always a dumb idea from the perspective of building a business or an economy on it. 3. Anyone who really looked at Bitcoin in 2012 could see it was not a realistic replacement for PayPal unless you were thinking about paying on a place like SilkRoad.
- GoblinSlayer 6y ago
  Fiat systems have such infernal UX, bitcoin can win on that metric alone. The FUD spread by the regulator is the only reason we're here.
  - morpheos137 6y ago
    By infernal you mean they comply with AML regulations like KYC? Not following the law is not a "metric" legitimate businesses usually brag about. Anybody who use FUD as an argument for something is pushing some kind of snake oil. FUD stands for "Fear, uncertainty, doubt." Why does FUD exist? Because historically when we did dumb things there were consequences. Is fearing consequences an irrational thing?

datalus 6y ago

2nd post down... doxxed ooof.

deleted 6y ago

[deleted]

quickthrower2 6y ago

Ah the good old days, when people talked about Bitcoin solving too high credit card fees. It’s now $15+ per transaction in fees but it’s now a store of value so it doesn’t matter!

spurdoman77 6y ago
Thats cheap transaction fee for buying my yacht or private island with BTC
anonymoushn 6y ago
There are other cryptocurrencies that have higher tps and lower per-transaction fees. Bitcoin has low transaction fees compared to US domestic wire transfers or compared to using a credit card on a purchase of $1000 or more.
CraigRood 6y ago
The $15 is debatable, mempool.space is closer to $5 for confirming within 60 minutes, which is many factors faster than what Mastercard do in the traditional world. I would argue though that the magic of Crypto isn't buying coffees. After Silkroad we have seen very little interest in using Crypto as money, and even with "high" fees, alternatives have not become desirable for their ability to transact cheaply. I would also point out that even the likes of Coinbase have a 0.5% fee before spreads. Using crypto over cash or card (at least in Europe) isn't a cheaper of faster process end to end. IMHO Bitcoin IS an offshore account, and the ability to move wealth anywhere in the world, without a middle man, entirely permission-less and trust-less for even at $15 is a massive achievement. Don't get me wrong, it can be cheaper, but what Bitcoin can do, and how individuals from retail investors to publicly listed companies are holding Bitcoin its a massive signal in terms of whats actually desired.

650REDHAIR 6y ago

Threads like that are a big reason I'm not very active here on HN anymore. So much negativity masquerading as "constructive feedback".

deleted 6y ago

[deleted]

ckue 6y ago

Pretty sure ijoey on this thread is a time traveller, as BTC/USD reached $60k when Coinbase IPO'd > Boy. This is the 60000 dollar question isn't it? Who wants to be my partner? Good luck. I really hope you find them. Taking on the credit card industry is going to be awesome! https://news.ycombinator.com/item?id=3754835 https://news.ycombinator.com/item?id=3754835