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People don't want to run their own bank
- hungryforcodes 5y agoI definitely want to run my own bank. But I'm not all people.
- josefrichter 5y agoFully agree. I'm heavily in crypto but keep saying the same - people will demand banks, will demand regulation, will demand insurance. One recent example: a few days ago there was a big movement in crypto market. Due to huge traffic spike that went with that, one unnamed chain practically ground to a halt. The only thing that continued working normally was liquidation bots... So tons of people got liquidated coz they couldn't adjust their positions. And now obviously they all are calling for compensation. But in the decentralized world of de-humanized smart contracts with no legal framework, there's obviously nobody responsible, hence nobody to pay any compensation.
- ricardobayes 5y agoIt's a breath of fresh air to read some level-headed (and realistic) response in this topic. I find it usually when btc is in a downswing, it's easier to have a meaningful conversation about it.
- bhouston 5y ago> one unnamed chain practically ground to a halt. What chain? Any links to stories on this?
- josefrichter 5y agoI don't want to spread FUD here. For the point I wanted to convey it's not relevant. Feel free to look it up, but please don't write it here, coz it will turn to flame war.
- jstx1 5y agoIt's not FUD - it either halted or it didn't. Are you talking about Solana?
- ShamelessC 5y agoThey're referring to openly "manipulating sentiment" (with facts?) around a given coin/institution. I guess people are ostracized for this in crypto circles? Seems pretty lame honestly.
- oblio 5y agoNot just lame, highly ironic, considering the entire environment. https://www.youtube.com/watch?v=AwDbx-nuQ5o https://www.youtube.com/watch?v=AwDbx-nuQ5o
- arbol 5y agoSo you hold a lot of SOL then ? ;)
- AtillaBosma 5y agoI believe it's Solana based on this Bloomberg article: https://www.bloomberg.com/news/articles/2022-02-03/solana-polygon-are-among-blockchains-being-overrun-by-crypto-trading-bots https://www.bloomberg.com/news/articles/2022-02-03/solana-po...
- bidirectional 5y agoThe chain is Solana. I've no idea why the other commenter is so adamant on not naming it. https://www.bloomberg.com/news/articles/2022-02-03/solana-polygon-are-among-blockchains-being-overrun-by-crypto-trading-bots https://www.bloomberg.com/news/articles/2022-02-03/solana-po...
- charlieyu1 5y agoI don’t want regulations while being aware I’m at my own risk to take care about my money.
- EugeneG 5y agoThat’s obviously true. And once you accept that then the whole premise behind crypto is gone - if centralization is the only way to make it work, then traditional banking is preferred. All that’s left are use cases that are in the gambling and money laundering category.
- josefrichter 5y agoI disagree. I believe there's a lot of areas where crypto can bring much more efficiency and transparency into financial markets, and that's a good thing. I agree the point is not to replace banks, but perhaps evolve them, bring about new types of financial institutions, products and instruments.
- civilized 5y agoWhat kind of efficiency are you talking about? It's far, far from clear -- at best -- that crypto can be more energy-efficient than traditional banking. Transparency? Really? For whom? Do you want your taxes on the blockchain for everyone to see?
- zikduruqe 5y agoI am not an expert in crypto at all, but what I would love to see maybe, is some type of stablecoin supported by the USPS. USPS used to be in the banking business and are now looking into it again. Is there an opportunity for the USPS to support USDC, to replace money orders to help serve the underbanked? I dunno. https://executivegov.com/2021/10/usps-launches-pilot-banking-program-at-four-postal-service-test-locations/ https://executivegov.com/2021/10/usps-launches-pilot-banking...
- XorNot 5y agoWhy wouldn't the USPS just be a bank, with accounts with the Fed and FDIC insurance though? The USPS not providing banking services is because Congress won't let it.
- ben_w 5y ago
- satellite2 5y agoAll of this would be nice if we didn't stumble into negative interest rates territory for a while. Having to pay to hold a depreciating asset is going to make the choice much less evident.
- noipv4 5y agoDepends on who you ask, during 2010 - 2012 so many people were enthusiastic about running their own bitcoind node. Every other day I see a new reddit post of a cute little node running on a rPI with an external SSD and a tiny e-ink display.
- noipv4 5y agoAlso people in countries facing hyperinflation or corrupt banking system (Venezuela, Zimbabwe, Argentina, Turkey, Lebanon etc ) might be forced to run their own crypto piggy banking infrastructure, as inconvenient it might be.
- dmitriid 5y ago> Also people in countries facing hyperinflation ... might be forced to use the currency that is as volatile as their own? Why?
- cedilla 5y ago...or they just do what was always historically done and use a neighbour's stable currency, or simply USD or EUR. Switching from an inflationary currency to a stable one is already tough, switching to a volatile deflationary currency would be a nightmare.
- noipv4 5y agothe problem is when shtf, USD and EUR are the first to be controlled by the government and banks.
- cedilla 5y agoWell, I can understand being enthusiastic about storing a 2-4GB blockchain, but today we're already at 390GB, growing by about 60 GB a year. And that's just bitcoin, Ethereum is another 350 GB (up 100 GB last year). Just the cost of hardware, download and energy makes this prohibitively expensive for "banking the unbanked" at least.
- sneak 5y agoIt's true. But the world is moving away from cash, and soon the type of privacy and freedom it affords will be gone. People who need that sort of privacy and freedom need an alternative. Fortunately, the alternatives available are 100% opt-in and can be ignored and avoided if you don't like them - a stark contrast to retail banking in the USA, which we are all forced to use even if we don't want to.
- pietromenna 5y agoI agree with you and the article. I believe that crypto currencies solve if you need privacy with your money use case. What I think is that governments are interested in seeing we’re every penny goes so they can tax you properly. Centralized banks are somehow governments agents, they report were every penny goes. With regards to the money you had in your wallet, it was never your full assets, but the money you got to spend on something you don’t care and you do not want people to know what it was. This is your crypto wallet.
- XorNot 5y agoThe blockchain is public and immutable. There is no privacy. Every transaction of every coin everywhere is completely visible. Even if you run BTC through a tumbler...the overall flow of BTC is going to be moving towards whichever wallet holds it at the end of the chain when a physical transaction takes place. At which point if the physical transaction is picked up, the entire chain unrolls back to every initial source.
- amarant 5y agoWho are these people who need "privacy and freedom" that can't be had with regular banking? I mean, it's not like your account balance is public on regular banks.. I struggle to come up with an example which does not involve shady business, and if that's what we want, it seems like a better solution to just legalise those businesses...
- MinorTom 5y agoLegal Cannabis stores
- remolueoend 5y agoWhy not both? Making use of "crypto banks" but still be able to freely interact with the underlying financial network whenever I wish to? That's pretty hard today without relying on middlemen such as Stripe et. al. thanks to the fact that most banks do not provide any useful APIs.
- Zpalmtree 5y ago> So people use banks. In the UK, they're mostly free. I give an institution my money and, due to a combination of their size, insurance, and regulators, I'm confident that my money will still be there tomorrow. They are unlikely to give me fake notes, and they can refund me if I've been defrauded. I trust them. That's nice that you trust your bank. I wouldn't be so trusting. Nevertheless, if you want someone else to handle your funds for you, there are lots of reputable services that can hold your cryptocurrency with all of the guarantees you are desiring. I'm keeping my keys though.
- GavinMcG 5y ago> all of the guarantees Insurance? Regulatory oversight? Which services?
- ManuelKiessling 5y agoI haven't heard of a single case where a German bank customer lost his or her money because the bank did something fishy.
- capableweb 5y agoFortunately, there are more countries than Germany, and some of them have a very fragile banking ecosystem that many people would like to avoid taking a part of. Just as one example, remember the Greece bank run some years ago? The banks ended up implementing limits on how much you could withdraw each month, which frustrated many people. I'd say that's pretty fishy when the banks give the impression that the money you put into the bank, you'll for sure be able to get out whenever you want.
- amarant 5y agoYeah that Greek incident wasn't great. Still a lot better than when the biggest crypto exchange of Turkey just left with all the money that one time. That was catastrophic for many customers!
- daniel-cussen 5y ago
- fireflymetavrse 5y agoMany people underestimate how hard is to store securely and reliably a crypto wallet key on long period.
- bell-cot 5y agoThis +10 (if I could). And that ("Many people underestimate...") is before you factor in all the extremely talented people who are looking for ways to remotely steal crypto wallet data.
- im3w1l 5y agoHaving a small amount of money on-chain can work as a hedge in many scenarios. Risk of losing, sure it is high, but the failure mode is very different from anything else you own, so the overall risk is lowered.
- lrvick 5y agoI think it is a lot easier than reliably storing say, gold, and yet it is considered not unusual for people to keep some gold or other physical assets of value in personal home vaults. Unlike physical assets, you can make redundant copies of digital assets giving anyone not lazy a huge durability advantage. For readily accessible warm wallets not storing kidnapping-worthy amounts, this airgapped pattern can work well for the modestly technical https://github.com/hashbang/airgap/blob/master/docs/HD-Cryptocurrency-Wallet.md https://github.com/hashbang/airgap/blob/master/docs/HD-Crypt... Anyone that wants to learn reliable self custody hit me up. My job is teaching self custody to major fintech companies but anyone asking questions for personal use in public in places like #!:matrix.org I will help for free as I have time.
- capableweb 5y agoIt wouldn't be a web article if there wasn't some hyperbole in the title, like speaking for everybody :) But ignoring the title, here is how I see it working out long-term between "Running your own bank" VS "Using someone else's bank": It's true that most people don't want to run their own bank, it comes with lots of issues. But there is a section of people who do want to run their own bank. That the cryptocurrency space exists in the first place is the evidence of this. So can we solve for both things? Yes, I do believe we can. The primitives that support the whole system can be "Running your own bank" while allowing entities above that layer to offer "Use my bank if you want to instead, with insurance and all that", so we get the best of two worlds. The opposite cannot be true, we cannot offer people to run their own banks, on top of a set of entities being the only ones running their banks. In other words, you can build centralization on top of decentralization, but the opposite is not true. So by having the base being decentralized (and dangerous for the common human), we can still have centralized parties on top of that (less dangerous for the common human), that offers the traditional security people are used to, for the ones who want it. Decentralization at the core gives people more options, which I think in the long-term leads to a better world, compared to the alternative. Not because it is decentralized, but because it gives more options to the ones who need it.
- dorena 5y agoYou say that some people want to have their own bank. "That the cryptocurrency space exists in the first place is the evidence of this." Sorry, but that's just not true. Crypto exists because people think they can win money with this Ponzi Scheme!! ONLY reason! Greed
- josefrichter 5y agoVery well said. The more centralized "layers of abstraction" will be built, no question about that. Smaller, more specialized, more efficient institutions. For example, the US has a long tradition of small Credit Unions – that's fairly similar in principle to some of the DAOs popping up these days.
- js8 5y agoI disagree that anything crypto-related is similar to https://en.wikipedia.org/wiki/Credit_union https://en.wikipedia.org/wiki/Credit_union (or even useful, for that matter), but yeah, if you want to run your own bank, credit union is IMHO as decentralized as it can ever be.
- BoardsOfCanada 5y agoI don't think it's so much about running your own bank as having an open interface to finance and be able to hook in new services into it.
- hungryforcodes 5y agoOr just being able to do what you want with your money.
- throwaway22032 5y agoThe purpose of cryptocurrency is to be digital cash. Not everyone wants to use cash. That's fine. For those of us that do, there is now a solution. I think most people generally agree that most of the world aren't going to be using Bitcoin Core with a wallet.dat. They don't need to, though. Maybe 3% of us use desktop Linux. If it or something like it didn't exist, we'd still have to create it.
- josefrichter 5y agowell, one could argue that one of the use cases that cryptocurrencies are not good for is "digital cash". transactions are quite slow and expensive, so vast majority of cryptocurrencies are unusable for e.g. buying a coffee in starbucks.
- throwaway22032 5y agoYou mean like how desktop Linux is unusable by my grandma? I use it as digital cash all the time. Not every cash transaction is for trivial amounts, and as you say, not every blockchain is expensive.
- lowkey 5y agoLightning offers fast, cheap, anonymous transactions with Visa-like transaction throughput as well as instant final settlement. Why do people assume there have been no new technical developments since Satoshi’s invention in 2009? Lightning Payments would allow you to buy a coffee at Starbucks instantly while avoiding the 2-3% in payment processor fees.
- mikegreenberg 5y agoI disagree and believe that Lightning is not yet safe or easy for users. Here are my primary talking points if you'd like to discuss further: https://news.ycombinator.com/item?id=30210023 https://news.ycombinator.com/item?id=30210023
- 5y ago
- josefrichter 5y agoI highly recommend watching the talk "Thinking Through Law and Code, Again - Lawrence Lessig" to everyone interested in this topic.
- jonathan-adly 5y agoI think this very short-sighted. People don't want to run their own banks now because the UX behind Crypto sucks. But the space is moving like a rocket and who knows what the future holds. Anecdote: I am a fairly technical person but stayed away from the whole self-custody stuff because no way anyone in my family can figure it out and if something happens to me, its all gone. Two days ago, my wife (non-tech as you can get) got a muun wallet and was very happy about the experience. She got the point of being able to send money to her relatives in the middle east without the normal shadiness that goes on over there. (getting USD or any hard currency in and out of some middle eastern countries is a nightmare)
- 300bps 5y agoWait until your non-tech wife accidentally sends ETH to a BTC address. Or her hard drive dies. Or a million other things that can happen. And the one “legitimate” use case you list is to use cryptocurrency to bypass US controls on money transfers to monitored countries. How long do you think that hole will remain open?
- jonathan-adly 5y agoI think you are being disingenuous and emotional about it. Previously, the UX was terrible and didn't protect non-technical users at all, so these scenarios could happen. Newer tech with better UX does a wonderful job protecting users and is improving at rocket speed. The example I used protects the user from all these scenarios you mentioned. Also, the US doesn't care about moving USD in and out of most countries (Iran, NK excluded). It's these countries themselves that want that level of control.
- 300bps 5y agoThe example I used protects the user from all these scenarios you mentioned. How does it protect against hardware failure? How does it protect against sending Coin X to a wallet meant for Coin Y? Also, the US doesn't care about moving USD in and out of most countries That's funny. And even if what you said were true, other countries will eventually control what appears to not be controllable today.
- practice9 5y ago- People don't want to run their own email / FTP server -> Their data and conversations are being watched and analyzed. - People don't want to run their own IoT server -> Their device/subscription stops working if the company goes out of business or changes the ToS. - People don't want to create their own subscription feed -> They are being manipulated by the algorithm and misinformation. - People don't want to run their own bank -> ... There are lots of good reasons to run your own infra and we should strive to make it easier to do for everybody
- hyperman1 5y agoAround here, if one half of a married couple dies, the surviver can't access the shared account until the state gives its OK. Which can take up to 6 months. Imagine living without money for 6 months while having to pay a funeral. I saw it happen to an elder woman. She had to loan from friends and family because of this. Now I heard the law has been updated to avoid the most egregious excesses, but the basic principle still stands. I know of a few people who keep 1 or 2 months worth of money at home, just in case. Can't blame them. Banks are generally good at what they do, but don't put all your eggs in 1 basket. Someone will make a mistake at your expense, better be prepared and have some buffer.
- UncleMeat 5y agoI'd wager that "oh fuck, my partner died and I have no idea how to access their private key" is considerably more likely than "my partner died and I cannot access their traditional bank account but it's all good because I've got their private key to access emergency funds stored in BTC."
- toqy 5y agoYes if they didn’t already have a joint bank account why would crypto magically change this
- av500 5y agoand of course they couple could have shared access to each other's bank accounts
- hyperman1 5y agoThis does not work. When married, all your and his/her accounts are locked, as they are considered shared property, no matter the name on the account. The legal proces after death is to decide who owns what as this decides what share the state gets. Also not advocating for crypto, just saying you should be able to live a while without access to a bank.
- jasode 5y agoThis essay is too simplistic about the motivations of some crypto holders. For many people, the more complete sentiment is this: People don't want to run their own bank but they'd rather deal with that extra hassle instead of letting the government erode their purchasing power or confiscate their savings. How much of a reality that is to particular person depends their economic environment. A Venezuelan living with hyperinflation thinks about the fragility of their savings differently than an American. Likewise, many don't really want to run their own electric generator because it's noisy and keeping diesel fuel on hand is extra work. However, they'd rather deal with that than have no electricity when the power company issues rolling blackouts. So, an option can be framed as a "bad choice" but it must also be compared to other bad choices that may be worse. Which bad choice do people prefer? A noisy diesel power generator they have to babysit or a no power at all? Writing a hypothetical essay titled "People Don't Want to Run Their Own Diesel Generators" -- will not actually educate readers on what's happening. Yes, crypto POW uses too much energy. But how do you get people to prioritize the environmental impact over their fears of government manipulation?
- edent 5y agoAuthor here. I broadly agree with you. I run my own power generation. They're solar panels on my roof and require zero maintenance. People don't want to run generators. They want stable electricity. There are a variety of ways we can give it to them. Similarly, people in a hyper-inflation environment don't want crypto - they want stability. But there's nothing inherent in crypto which prevents hyperinflation. Yes, I've read the original bitcoin paper. That talks about monetary supply - it doesn't do anything if a cartel decides to raise prices.
- magicjosh 5y agoThis article seems like it could have been written in 2009 at the launch of Bitcoin. It has no real world examples or data. There are so many disaster stories. Is there a reason you chose to write such a high level article now? One of the things that made Moxie's piece a hit was it had real examples of his experiences trying to do things. But this article has none of these examples or experience. For example, your article misses people who are indeed using cryotocurrencies as banks [1]. It misses the current conversation around social management of keys. The rise of automated exchanges like Uniswap. Lots of room for critiques on these items. That the only examples of people using crypto for real banking are in collapsing currencies. That if there's such a problem managing keys that social management will still fail. But you seem to have missed all of them which really undercuts your article to me. Again, this seems like it could have been written in 2010 based on the concept of crypto rather than real world experience. Just curious about your motivations for such a piece. It certainly has attracted commenting here. Disclosure: I own crypto [1] Reporting of LocalBitcoin use in Venezuela. Certainly room to use these examples of why cryptocurrencies will never scale, but not mentioned in the article: https://www.reddit.com/r/Bitcoin/comments/s5i64l/24_btc_were_traded_in_venezuela_last_week_only/ https://www.reddit.com/r/Bitcoin/comments/s5i64l/24_btc_were...
- ghostwriter 5y ago> I don't have the time, energy, or skill to securely run important servers all by my self. But some other people do. > I give an institution my money and, due to a combination of their size, insurance, and regulators, I'm confident that my money will still be there tomorrow. They are unlikely to give me fake notes, and they can refund me if I've been defrauded. I trust them. Good luck! Your trust in them is not a guarantee that you are able to get your money back from them at any point [1] [2] [3] [4] [1] https://www.reddit.com/r/UKPersonalFinance/comments/aqxz5n/hsbc_has_frozen_our_bank_accounts_leaving_me_my/ https://www.reddit.com/r/UKPersonalFinance/comments/aqxz5n/h... [2] https://www.reddit.com/r/UKPersonalFinance/comments/ryc8i4/barclays_closed_my_account_and_requesting_proof/ https://www.reddit.com/r/UKPersonalFinance/comments/ryc8i4/b... [3] https://www.reddit.com/r/UKPersonalFinance/comments/l4tps5/hsbc_closed_my_account_and_i_will_be_in_trouble/ https://www.reddit.com/r/UKPersonalFinance/comments/l4tps5/h... [4] https://www.reddit.com/r/UKPersonalFinance/comments/cbpxit/hsbc_blocked_account_due_to_fraud_but_unsure_what/ https://www.reddit.com/r/UKPersonalFinance/comments/cbpxit/h...
- learc83 5y agoYour first example was caught up in a government mandated anti money laundering investigation. If the government is after you, crypto isn’t going to protect you. It might make the cost to go after your money a little higher if you’re willing to violate court orders and live as a fugitive.
- throwaway22032 5y agoNo, but it sure is easier to deal with day-to-day expenses if you don't have an empty account. You can co-operate with an investigation whilst also not handing over complete control of ~all of your assets for the interim.
- learc83 5y agoNot if the investigation includes a warrant to seize your crypto assets. Which a money laundering investigation certainly could.
- deleted 5y ago[deleted]
- endisneigh 5y agoThe problem with crypto is that since the price goes up people rationalize everything. If the price went down 10% year after year forever I guarantee people would shut up about it even though none of the underlying reasons for supporting it should have changed.
- XorNot 5y agoI mean that notion right there sums up everything about it: the "price" of crypto - as related to USD. That's what people care about. No one's treating it as a currency.
- BTCOG 5y agoThis is also not true and is just a "wide brush" principle. Many people are dollar cost averaging into Bitcoin and buying weekly/monthly regardless of the price, saving up in a secondary store of value. Just because you see a few cryptobros shilling some altcoins on Twitter/Reddit or wherever doesn't mean your assumptions apply to everyone, or even a vast majority. Many real life folks I know buy little chunks of Bitcoin on a consistent base regardless of the price as a form of savings.
- SantalBlush 5y agoThe true underlying reason for supporting it is "stonks go up." They call it deflationary, but that's the same thing.
- mavhc 5y agothe problem is that unless the transaction costs are high, anyone can hack it If your problem is the government might go crazy, the solution is to be part of society and stop that happening, not run away and hide in your cave
- lostmsu 5y agoI don't understand the point that you are trying to make. This is what it looks to me: "the problem with gravity is that since the objects fall down people rationalize everything (e.g. give explanations why they should fall down). If the objects went up year after year forever I guarantee people would shout up about it even though none of the underlying reasons for supporting it should have changed"
- raven105x 5y agoIt's not a step backwards, it's a tradeoff. Crypto is a tool, just like a bank is a tool. It has different pros, it has different cons. Personally I greatly enjoy sending any amount to any country without the possibility of a hold or embargo because "MuH TeRrOrIsM, tHiNk Of ThE cHiLdReN and WaR oN DrUgZ" which is in reality just about governments always wanting more power since all three of those are routinely found to be enabled by and participated in by big banks anyways. At the end of the day, you relinquish control for a false sense of security. Everyone storing their money in banks in Venezuela found this lesson out the hard way: you don't have any money. The government allows you to store and pass around notes for debt, which are commonly agreed upon as valuable and so our economy spins onward. You know what they say about those willing to give up freedom for security. Realistically, use your head please. Full tradfi and full defi are equally unwise. It's risk management 101. And yes, some very unsavory things going down in any country are always a risk if you are planning a resilient infrastructure for your estate spanning generations. Usually this has taken the form of multinational diversification, but now we have the extra option to secure long-term wealth without all the legal expenses. Don't dismiss it. A non-material agreed upon medium of value transfer completely outside of control of governments is unprecedented. You can go to any country, and get someone to give you their paper currency, for a digital one you possess - without ANY restrictions or moratoriums. I'm not sure how that can possibly be called a step backwards. It's a valuable tool even if most of HNs audience has no use for it. Control comes with risks and responsibilities. This is true for being your own bank, running your own infrastructure, and everything else. Literally nothing about this tradeoff is new or shocking, except that it's now available for currency as well.
- samwillis 5y agoThis is also why I don't believe in "Smart Contracts" and the term "code is law", ultimately people want people to be answerable to people. We have courts specifically to address contract and financial disputes, they are essential and provide a level of insurance over business and financial operations. With smart contracts you have none of this as well as the risk of a bug or backdoor in the code. No one is going to be auditing all smart contracts. They want to be able to use the legal system to address a problem after the fact if it goes wrong. Admittedly I am no expert, but those concerns have kept me away from ever considering exploring them.
- lostmsu 5y ago> This is also why I don't believe in "Smart Contracts" and the term "code is law", ultimately people want people to be answerable to people. We have courts specifically to address contract and financial disputes, they are essential and provide a level of insurance over business and financial operations. This is exactly wrong. Some people ultimately want people to be answerable to people. There are plenty of people however, who want to be answerable to code instead. Unlike with other people, you can potentially verify that the code you trust in is neither irrational, nor cruel.
- temptemptemp111 5y ago
- hd4 5y agoThis is by far the dumbest ever HN post that has made it to #1. Too many fallacies to bother taking apart but the worst one must be "banks are free that means they're preferable".
- rvz 5y agoWhen the author's PayPal, Square Cash, Amazon Smile, Ko-Fi and Flattr accounts all get shutdown, for no reason whatsoever, they will crawl back to using cryptocurrencies and stablecoins for donations.
- oblio 5y agoThis obviously sucks, but how common is that? 0.0001% of cases? Have there even been moderate - not even large - scale protests against banks freezing accounts? Regular banking is slow and cumbersome, but it does work for most people.
- rvz 5y agoThere was just this [0] right here, which is directly related to [1]. Regular banking is useless for both of these users. Maybe they and the problem don't matter since they are 0.0001% of cases, even when the banks have the ability to do that. Platform-wise, I won't be surprised if they do same thing as GoFundMe [2]. [0] https://news.ycombinator.com/item?id=30213365 https://news.ycombinator.com/item?id=30213365 [1] https://theintercept.com/2022/01/19/crypto-afghanistan-sanctions-taliban https://theintercept.com/2022/01/19/crypto-afghanistan-sanct... [2] https://news.ycombinator.com/item?id=30187172 https://news.ycombinator.com/item?id=30187172
- g5095 5y agoUsing multisig keys distributed around trusted family members makes most of these problems invalid. There are many ways you can structure a Multisig wallet (this is how many crypto foundations and NFPs manage their assets)
- matheusmoreira 5y agoIt doesn't matter if people want to run their own bank. This is about freedom and principle. If you'd like to deposit your money into some bank, you're free to do so. However, nothing in society should require a bank for anything. For example, a paycheck should be deposited directly into a worker's cryptocurrency wallet. Anyone who wants their payments to go into their bank account can simply provide the address of their bank wallet instead of their personal wallet. This way nobody is forced to create some bank account just to get paid their salary.
- otrahuevada 5y agoOnce upon a time I became convinced I wanted to create the first 100% virtual bank of my country. Not having the faintest idea of how to do such a thing I set out to at least collect a roadmap of the paperwork needed to do that, so I could glean some knowledge in the process. Ended up consulting with a lawyer and gathering a grand total of 1700 distinct bits of paperwork I needed to fill and complete as a random person. Every one of those things would have to be accompanied by documentation, most of which had to be presented in person at least back then. Would have taken me about 5 years if I managed to file a paper a day every day. To this day I still have no idea how on earth do banks just pop up one day.
- htrp 5y agoParallel processing and experience. It also helps if the people on the charter have run a bank before
- ArtTimeInvestor 5y ago"Run your own bank" is just too crude of a statement. Cryptography is a technology that will increasingly be interwoven into all systems. So you might still be using a traditional bank account. But you will be protected from identity theft. If someone impersonates you and claims you have lost your credentials, the bank will say "Ok, we can unlock your funds with our master key. But that will take 7 days from the moment we write the recovery message to the blockchain". Then the real you can see that message and intervene. I might not want to run my own bank. But I totally want to be protected from my banks incompetency. And from the incompetency of my domain registrar, land registry, phone provider etc.
- toqy 5y ago> I might not want to run my own bank. But I totally want to be protected from my banks incompetency. And odd statement, banks generally seem more competent than any given crypto operation.
- yunohn 5y ago> Then the real you can see that message and intervene. How does one “see” this message? In fiat, my bank just calls/emails me. > But I totally want to be protected from my banks incompetency In your example, what if you’re “incompetent” and lose your keys, or get kidnapped and keys are stolen - how would a message on the blockchain help mitigate this?
- trey-jones 5y agoWell, I think it's been obvious for many years that convenience is the most important factor (to me) for how I choose to pay for things. Do it online or write and mail a check? One card and very little thought, or fumble with bills and receive useless coins? Just wave my phone like a magic wand? OK. So if I can pay with crypto as easily as I can pay with my credit card (with or without the phone), then we're in business. I'm sure I'm not the only one.
- deleted 5y ago[deleted]
- rglullis 5y agoPeople don't want to run their own bank, but they also don't want to depend an unbelievably opaque, complex systems that periodically crash, with no real accountability. The important thing that crypto brings is optionality. Without crypto, what option do we have if not to trust the handful of BofAs, Itaús, Deutsche Banks, Santanders and the Goldmans out there? Decentralization is a spectrum [0]. The Finance/Banking system is getting ever more centralized, more faceless, more intractable to individuals. Community banks and credit cooperatives are getting extinct. My dream goal for Hub20 [1] is that it allows us to bring community banks back. So those that do want to go through all the work of "being their own bank", can do so, but those that are simply looking for an alternative to the big banks, can go look for a more local, human-scale "bank" which can be powered by Hub20. [0]: https://twitter.com/rlullis/status/1307420668372430848 https://twitter.com/rlullis/status/1307420668372430848 [1]: https://blog.hub20.io/decentralization-costs-and-tradeoffs/ https://blog.hub20.io/decentralization-costs-and-tradeoffs/
- ricardobayes 5y agoNormal people trust people in suits more than an anonymous group talking in terms they don't understand. That's not going to change. My view is cryptos are/will be the 'new cash', as in cash is now used for mostly illegal purposes anyway. Nobody withdraws 100 dollars to buy groceries.
- rglullis 5y ago> Normal people trust people in suits more than an anonymous group Who said anything about "anonymous groups"? What happened with the idea of family-owned businesses, local communities, cooperatives? Have millennials become that alienated from their immediate environment? Is it so hard to conceive of a world where a small-medium business can "run their own bank" so that any of its employees/contractors/suppliers have accounts at their local "crypto bank" to get paid? Or a farmers cooperative that providers sales/distribution services to its members and uses a Hub20 instance to manage payouts, or provide mutual insurance services?
- 5y ago
- olegious 5y agoThis isn’t a black and white issue. I think the future is one in which most people that simply want better returns on their stables, play games or collect nfts, the key management is obfuscated by a centralized service while a minority that want to be on the cutting edge manage their keys, deal with bridging, etc themselves
- lrvick 5y agoMeanwhile I grow tired of Visa and others logging my transaction history and travel patterns to sell changes in my behavior as a service. I am seeking to minimize this. I still have bank accounts for clients that really want to pay via ACH. I keep enough USD in the account for a few bills and a little cash on hand for purchases IRL and recently adopting prepaid debt cards since some stores refuse cash. The rest is sold for Bitcoin and other crypto-assets to hardware wallet devices backed by cold wallets managed offline that can be recovered via a quorum of people I trust spread across several countries. No one government or individuals would have any legal or even practical means of seizing my cold wallet assets. I pay my taxes but the rest is mine and free from inflation long term. Meanwhile I have friends that have had their accounts frozen over (eventually proven bogus) legal claims filed by individuals, stolen by randos social engineering bank tellers, and my own account frozen multiple times over them thinking my own small purchases were fraud... and deleted once because I had a PO Box on file as my street address. Nevermind the fact I was homeless for years and the homeless do not have street addresses and are thus deemed unworthy of bank account unless they get creative with street addresses. The security, availability, and stability of bank accounts is greatly oversold. I have done subcontracting work for major banks and I can confirm at least one still uses ie6 and activex as recently as a few years ago to touch your personal data. Big banks like Chase do not even allow you to have even last gen poor security hardware 2FA unless you maintain a balance over $100k with $500k in yearly deposits. Security is a feature they sell to those too rich to care about inflation eating their lunch with large USD balances. Online I use Bitcoin anywhere possible and a Coinbase visa as a fallback I can send Bitcoin to in order to proxy to USD on the fly. I also am one of those crazy people that hosts their own online web services in a closet server rack. I would like to see the UX of flows like this become easy enough that anyone can do it with minimal risk of shooting themselves in the foot. Some of us do care about personal privacy, security, and sovereignty... these days more than ever. The political future of any country is never certain.
- yunohn 5y ago> Meanwhile I grow tired of Visa and others logging my transaction history and travel patterns to sell changes in my behavior as a service. I am seeking to minimize this. Your alternative is to write all your transaction history to a public ledger?
- stepanhruda 5y agoI am surprised no one mentioned social recovery, Vitalik even wrote about it https://vitalik.ca/general/2021/01/11/recovery.html https://vitalik.ca/general/2021/01/11/recovery.html
- saul_goodman 5y agoLet someone else do all your thinking for you and you'll lose the ability to think for yourself. Let someone else do all your banking transactions for you and you'll lose the ability to do your own too. CBDC's are directly aimed at controlling how people are allowed to spend their money. I'm sure most people will be fine with that as there will be a lot of grooming beforehand to normalize what we're allowed to spend our money on in the name of checks current state of emergency - climate change. "We're sorry, it was decided there's too much housing in the region you want to build that house, we're denying all of your purchases related to housing in this geographic area". I know it sounds over the top, it will certainly be denied until CBDC's are here and in use, only then will it start happening. But only in a few cases, and "we're ok with how monetary control is being decided in the cases that made the news so far, it's being blown out of proportion". https://headlineusa.com/bank-of-international-settlements-chief-talks-absolute-control/ https://headlineusa.com/bank-of-international-settlements-ch...
- nathias 5y ago
- jimmysong 5y agoThis article is an example of a person speaking from the perspective of massive financial privilege. Does the author realize how much people in the third world have been screwed over by banks and why they wouldn't want to trust one? The author's opinion would be vastly different if the author were a resident of Turkey or Lebanon or Nigeria right now.
- severak_cz 5y agoI see this pro crypto argument by disfuctional states a lot. But is there sufficient infrastructure to use crypto in disfuctional state? If you want to be cashless you need a lot of infrastructure around you...
- oblio 5y agoAnd you quite very likely need to be willing to break the law, as most countries only recognize/accept payments in local currencies.
- thebean11 5y agoWhat infrastructure? The sender and receiver need smartphones.
- maxbond 5y agoThe same argument can be made here. "You're speaking from a place of infrastructure privilege. Not everyone can afford smartphones. Not everyone has reliable access to electricity. Not everyone has reliable access to internet." (I'd like to clarify I'm pointing out that this argument can be made, I'm not actually claiming to be familiar with anyone's circumstances or privileges.)
- thebean11 5y agoThat's true. I'm not an expert, my guess though would be that more people have access to smartphones with a network connection than have access to a good banking system with stable currency.
- birracerveza 5y agoWhy not both? You can use crypto if you want to "run your own bank", or you can use a bank. The existence of one does not preclude the possibility of also using the other. I use crypto, I am aware of the risks it entails and allocated capital accordingly, the rest held in a bank or safer "centralized" store of values (stocks, etfs, etc). Some people go full crypto with no bank, some people want nothing to do with crypto and will just use a bank as usual. None of this should concern anyone but the person making this decision. That said, this article is simply the rationalization of the author's choice about why he won't use crypto, raising basic concerns that anyone that knows about crypto should be aware of, but of course it reached the front page based solely on the fact that it's anti-crypto. However, I want to address the closing quote. >Would you carry around your life savings in your wallet? Would you store everything of value in your home in a safe? Would you want to run your own banking infrastructure? You don't have to carry all your life savings in a single wallet that you carry around. You can split everything in multiple wallets, distributed in a safe way so that you don't lose everything if your house burns down, or you are held at gunpoint, or you become amnesiac, or you die, or whatever. How you do that is your responsibility. You don't want that responsibility? Then just use a bank. Also, I didn't know I had to run my own banking infrastructure to use crypto, up until now I just used a wallet.
- RandomLensman 5y agoAs long as the people who go full crypto act under the same rules as banks for KYC, sanction compliance when moving money etc. (i.e. like for like) - why not? If we can atomize things to that level, I would expect the banking landscape to also look somewhat different - but might not be a bad place to be.
- multisig 5y agoIt's called a multisig wallet. There are companies that do this as a service for you and ensure if you lose your phone or wallet you can recover your funds. This will be a standard feature that Google, Apple, Microsoft, etc provide in the future. You'll see.
- oblio 5y agoWhy would they? Google & co. could have implemented a Web Payment API in the last 20 years, they didn't. Instead we got Google Pay & co. It's not going to make them (enough) money, so, again, why would they? Why not build a proprietary thing or even a proprietary blockchain, if we're that adamant it has to be crypto?
- memiux 5y agoPeople don't want to run anything on their own. FTFY.
- nayuki 5y agoThis article is biased and fails to acknowledge many advantages that cash has over credit/debit cards: * Transactions are private. There is no middleman between you and the merchant to censor your transaction or to sell your purchasing habits to advertising companies. * Transactions are final. The merchant has no risk of chargebacks. * Transactions are bounded. Once you walk away, the merchant cannot take more money from you. Whereas with credit cards, they could store your number and charge you again at a later date, without your knowledge. * The amount transferred is known to you. Whereas with credit cards, the merchant terminal could lie and show you an incorrect amount, and you could approve the fraudulent transaction. * The maximum amount you can lose is limited by the amount of cash in your wallet (let's say $100), not by your credit limit (let's say $3000). * It's easy to understand - you have physical tokens with numbers on them. There are no accounts, statements, minimum payments, interest, fees, reward points, customer service phone numbers, etc. Cash obeys the principle of least privilege much better than cards do. Though, I think electronic payments can be a lot safer if we had a culture of push payments ("I send $123 to Amazon to purchase widgets") instead of pull payments ("here's my credit card number, have fun").
- wonderwonder 5y agoMost of these are pretty solid positives. "Transactions are final. The merchant has no risk of chargebacks." Is this a plus all the time? What if I buy something and the vendor just takes my money and does not send me my purchase? I have no recourse.
- nayuki 5y agoLook at it from the merchant's perspective: If chargebacks are easy and the middleman (PayPal, etc.) tends to side with the buyer, would you take the risk of putting up your goods for sale? There is a tradeoff here. This is a large reason why many cryptocurrency vendors online require you to use irreversible payments (cash, wire transfer) to buy crypto, in order to match the finality of crypto transactions.
- MMAesawy 5y ago
- deleted 5y ago[deleted]
- pibechorro 5y ago* rich western people The rest of the world is desperate for banking without gatekeepers, ridiculous wire fees, corrupt inflation, etc. Tech like bitcoin will liberate millions who only own a cellphone and are either denies banking alltogether, milked dry with 30% plus fees, or whose nearest bank is hours away. Let banks compete.
- jdrc 5y agoPeople don't want to run their own bank but they want the option to do it. People don't want to store their own cash but they want the option to do it.
- glerk 5y agoWhy is this so hard to understand? “I don’t like crypto”. Ok, don’t use it. This anti-crypto cult has been rehashing the same arguments for years while the crypto space continues to build new applications and innovate.
- unixbane 5y agoSTFU > The world is moving away from cash. Just before the pandemic, I went a year without using cash. Since then, I haven't withdrawn any notes. I have used cash my entire life, and this hasn't changed with COVID (no I have never got COVID. yes I go outside every day, usually to buy ingredients for whatever I'm cooking). > Holding on to cash is like running your own bank. I carried $20K in my pocket for years and told nobody. Never had a problem. > So people use banks. A bank I use requires Chrome to login, it literally will not work with anything else. This is the worst fucking UX in existence and is not some special nerd concern. They are telling you they have a webapp, as in, a thing you can use with a browser, but it's really just like a normal program but gimped because you need to install a dependency to use it (and you have to figure this out for yourself or call them at which point they'll suggest using Chrome after an hour). And the ATM is some half working garbage on top Windows. The phone banking doesn't work either and is deprecated as it requires real staff. I also use cash for public transit. Wheras convenience idiots end up wasting hours of time navigating half working websites trying to load new funds into their account, getting interrupted by website updates, Windows OS updates, etc. > As Moxie wrote a few weeks ago that most people don't want to run their own servers. Moxie is observing how the current state of software is trash and concluding that normal people don't want to deal with trash (which is frankly written by low intelligence programmers who believe things like "C is more secure than Java"). > If your hardware wallet or keys are destroyed, you've lost everything. Who cares? Use a bank if this is your concern. They will happily give your money away to whoever claims they lost it. No seriously, this is such a dipshit article. It lies on this idea that corpos just solve everything for you, including identifying you, which they don't, because they don't have a real human to establish a relationship with you. This entire idea that a corpo can authenticate you because they have some special hocus pocus[1] is a myth. 1. This could include things like, a government provided attestation channel, ID cards, knowing where you spent money from a card, being an Authority (TM) and therfore having big boy know how > If your loved one dies and didn't give you access, you've lost everything. You are a muppet. The smallest concern I have in the world is what happens to my parent's money when they die. And you use this as 1/3rd of the reason why "cryptocurrency bad" (the real reason they're bad is because they're centralized).
- titoCA321 5y ago
- kleene_op 5y agoMore so than wanting to run their own bank, I think many people just want to have the possibility to do so. It's just like running your own server: hard to do, many won't, but the fact that it is achievable using a reasonable amount of resources is a good thing on its own.
- superkuh 5y agoLol. As if Banks will give you back your money if they lose it due to incompetence or malicious behavior? No. You have the bring in the news media at the very least and have the resources to pressure them. There was an article about this on HN literally yesterday.
- deleted 5y ago[deleted]
- zeppers 5y agoNo one can genuinely rebut crypto without directly addressing this: https://fred.stlouisfed.org/series/M1SL https://fred.stlouisfed.org/series/M1SL
- mitchdoogle 5y agoWhat's the point of these crypto hit pieces? Obviously crypto is not the answer for everything, but it has it's uses and probably more uses undiscovered in it's future. The vast amounts of money gained and lost in such a short time seems to have clouded many peoples views, either through greed or jealousy.
- mw888 5y agoThis is kind of like saying people don’t want to run their own grocery store. Clearly it’s false. The bad assumption is that owning Bitcoin == Running Bitcoin. Running Bitcoin (nodes and miners) == Running Bitcoin, and people want to do it for obvious reasons - the beauty of the protocol is how little power those people running it actually have.
- BTCOG 5y agoThis article is total nonsense. You don't store all of your money in ONE private key. You must have backups and plans for a spouse or family member to access funds. Just as with cash, nobody stores ALL of their cash in one wallet or location. If you don't want to use Bitcoin then just continue to do whatever it is you are doing and stop writing nonsense articles that make zero sense.
- gillesjacobs 5y agoIf you can't are unwilling to manage a few private keys, you definitely should not be near crypto. Or computers for that matter.
- Irongirl1 5y agoI do. OA (original author), does this mean I'm not a person?
- csomar 5y ago> Holding on to cash is like running your own bank. You have to check that the money you're given isn't counterfeit, store it safely, insure against loss, protect against theft, project future needs, etc. It is a massive faff. The author is trusting banks too much. -> counterfeiting: It's impossible to check that your bank is not counterfeiting money by cooking books. There are strict measures but not all countries have these. Also, your government can "counterfeit" your currency and neither cash or a bank account will help against that. -> store it safely: You need to store safely your online access codes and your credit/debit cards. -> insure against loss: Banks lose money but it's socialized on all customers (or multiple banks). Theoretically, you should compare people loss vs bank loss of money; but insurance gives you protection against a single accident and it's difficult to get such insurance as an individual. -> protect against theft: Banks do help in modern countries but it's far from a 100% guarantee. -> project future needs: don't even know what this means? > So people use banks. In the UK, they're mostly free. I give an institution my money and, due to a combination of their size, insurance, and regulators, I'm confident that my money will still be there tomorrow. They are unlikely to give me fake notes, and they can refund me if I've been defrauded. I trust them. Fair enough. 2008 was 14 years ago. I guess that's the average person's memory? > So people will gather around big institutions. Those which have the funds, insurance, and regulatory oversight to provide a reasonable degree of trust. So that's Coinbase & co but with the extra feature that you can take matters on your own hands. How is that worse than a fully closed system? > But don't come running to *me* Sorry but this dude is full of himself and I don't think he understands cryptocurrencies
- Irongirl1 5y agoHmm. Well my first answer didn't even garner a response. So I'll risk getting my hand slapped and try again. I know for a fact that this is not true. YCombinator knows this is not true. How? YC invests in P2P companies. Those folks already run some form of their own bank. In particular the lending function. Why do they choose to do so...because they don't want to earn 0% (or less) on their own funds. They lend them to others at rates they like, generally 8% and up. People who invest in tax liens (some of those reach 16% interest) also run a lending function. Currently, neither run these operations on the blockchain. But that could change and I think it will be easier for them once they do. The reporting costs should go down and ease of any legal ramifications should go up. The same is true for anyone who handles personal investing (the trust function) or stock trading (the investing function). Many of you do both...you just call it something else. The main problem though is all these articles by rich, white guys that ignores 99% of the World...and tells us all what we want to do or not do. Please please stop.