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> This is just a criticism of US banking, not 'TradFi' as a whole. Most countries have let you do the exact same thing for free or at a low cost out of your exi

by xur17 5y ago

> This is just a criticism of US banking, not 'TradFi' as a whole. Most countries have let you do the exact same thing for free or at a low cost out of your existing bank account, no overhaul required, for years. The EU has SEPA, the UK has FPS, Canada has Interac e-Transfers, Australia has NPP. I suspect you'd have a hard time finding a country other than America which doesn't support this. But what these services offer is still fundamentally different from what crypto offers. The money shows up in your account instantly, but it doesn't actually settle for weeks afterwards [0]: > Unlike cards, SEPA does not have an additional authentication layer, such as a CVC check or 3D Secure. Consequently it is important to have good risk management tools in place to offset the threat of fraud. > A shopper can perform a chargeback online eight weeks after the purchase, with no questions asked. [0] https://docs.adyen.com/risk-management/chargeback-guidelines/sepa-chargebacks https://docs.adyen.com/risk-management/chargeback-guidelines...

arcticbull 5y ago
You're conflating two separate things: bank-to-bank person-to-person transfers and Adyen, which is a merchant acquirer. Merchant acquirers and credit networks operate under different terms. Chargebacks exist because there is a demand for them. They exist because customers want them - and yes, even businesses want them. It gives folks the confidence to buy without having to worry about trusting the merchant (because they trust the network to resolve a dispute). It increases average ticket sizes and payment volume. This is a good thing that crypto lacks. Finality isn't actually what you want in most cases. However it's irrelevant to this conversation because it also doesn't apply to any of the networks I listed. Adyen != FedNow. The systems I listed actually do provide instant settlements - as the money hits your account it's yours to spend. If for the bank, settlement isn't instant (and that's an if because again for the services I listed I don't believe it to be the case) they can just do what everyone else does and borrow against it for basically no cost while it settles. Again, this is a solved problem and broadly not an issue. [edit] Just as I suspected, FedNow settles instantly. [1] And all for the low, low price of $0.045 per payment, and $0.01 per invoice! I know, its pretty unbelievable they found a way to decrement a number in one database while incrementing it in another database without involving a global network of graphics cards, burning down the rainforest and re-inventing the very concept of money. (that is to say, without "going Rube Goldberg on it"). Unlike cards, SEPA does not have an additional authentication layer, such as a CVC check or 3D Secure. Consequently it is important to have good risk management tools in place to offset the threat of fraud. And this? Literally describes crypto. Because they both offer instant, final settlements without a second factor like a CVC check or 3DS. [1] https://www.moderntreasury.com/learn/what-is-fednow https://www.moderntreasury.com/learn/what-is-fednow

by xur17 5y ago

arcticbull 5y ago

You're conflating two separate things: bank-to-bank person-to-person transfers and Adyen, which is a merchant acquirer. Merchant acquirers and credit networks operate under different terms. Chargebacks exist because there is a demand for them. They exist because customers want them - and yes, even businesses want them. It gives folks the confidence to buy without having to worry about trusting the merchant (because they trust the network to resolve a dispute). It increases average ticket sizes and payment volume. This is a good thing that crypto lacks. Finality isn't actually what you want in most cases. However it's irrelevant to this conversation because it also doesn't apply to any of the networks I listed. Adyen != FedNow. The systems I listed actually do provide instant settlements - as the money hits your account it's yours to spend. If for the bank, settlement isn't instant (and that's an if because again for the services I listed I don't believe it to be the case) they can just do what everyone else does and borrow against it for basically no cost while it settles. Again, this is a solved problem and broadly not an issue. [edit] Just as I suspected, FedNow settles instantly. [1] And all for the low, low price of $0.045 per payment, and $0.01 per invoice! I know, its pretty unbelievable they found a way to decrement a number in one database while incrementing it in another database without involving a global network of graphics cards, burning down the rainforest and re-inventing the very concept of money. (that is to say, without "going Rube Goldberg on it"). Unlike cards, SEPA does not have an additional authentication layer, such as a CVC check or 3D Secure. Consequently it is important to have good risk management tools in place to offset the threat of fraud. And this? Literally describes crypto. Because they both offer instant, final settlements without a second factor like a CVC check or 3DS. [1] https://www.moderntreasury.com/learn/what-is-fednow https://www.moderntreasury.com/learn/what-is-fednow