7 ms·

Wire transfers in North America are literally 40 years behind the evolution of bank transfers in EU and UK. Sending money in Europe is free and increasingly of

by pavlov 4y ago

Wire transfers in North America are literally 40 years behind the evolution of bank transfers in EU and UK. Sending money in Europe is free and increasingly often instantaneous 24/7. It will be very difficult for crypto to reach the level of convenience available on unified infrastructure created through sensible regulation. Lacking that, maybe Americans will have to keep settling for all these clunky, incompatible intermediated patchwork solutions like Zelle and Venmo and USDC-on-Ethereum and whatever.

xur17 4y ago
> Sending money in Europe is free and increasingly often instantaneous 24/7. It will be very difficult for crypto to reach the level of convenience available on unified infrastructure created through sensible regulation. Lacking that, maybe Americans will have to keep settling for all these clunky, incompatible intermediated patchwork solutions like Zelle and Venmo and USDC-on-Ethereum and whatever. While true, I do think there is value in a permissionless protocol that anyone can plug into like this. Anyone in the world can send USDC to someone else (and any bank can integrate with this). The same can't be said for banking systems.
- closewith 4y ago
  While there is value in the avoidance of Anti-Money Laundering and Know Your Customer regulations, it's also not a feature that bodes well for the future lawfulness of the ecosystem.
axg11 4y ago
That's the point! Locally, there are great options almost everywhere. In Canada, I can e-transfer (Interac) anyone and the transfer is ~instant. Across borders the solutions are much worse. Crypto is the only payment rail that can realistically reach _everywhere_.
- peoplefromibiza 4y ago
  more than 350 billion/year travel from US to Europe as payments for exported goods. I think it already works... locally in EU means SEPA is available in 36 countries (includes some non-euro area and non-EU countries) and to more than 500 million people.
- quonn 4y ago
  And how often is that needed? And how often does it not also involve other issues, such as violating money laundering rules or tariffs? Crypto is the only payment rail that is practically accepted nowhere (I cannot use it to pay 99,99% of the places I do business with).
dcolkitt 4y ago
But that's the point, crypto is a coordination mechanism that in most cases serves as an alternative when you don't have effective and trustworthy centralized institutions. It's pretty clear that (in this case) European financial regulators did a good job coordinating an effective and efficient electronic money transmission system. But the whole world is not Sweden. Even in America, which is relatively first world with relatively decent institutions, our regulators failed to coordinate a decent electronic money transmission system. Now imagine being in Turkey or LatAm or Sri Lanka. (Or even just being in Europe and needing to interface with anywhere outside the European utopia.) Agree that decentralized protocols come with many inherent inefficiencies and frictions. But when institutions fail, the only alternative are decentralized protocols. In many ways I see the pro- vs. anti- crypto division coming down to how much people believe in institutions. Most crypto criticisms come down to an appeal to just focus on building better institutions rather than waste mountains of talent on overly complex decentralized protocols. "Instead of all this on-chain stablecoin nonsense, why don't we focus our efforts on electing better financial regulators, who can bring European like money transfers to North America and eventually the globe?" Whereas I think pro-crypto people (myself included), tend to think of any attempts to change public policy as /dev/null. Most of the world is saddled with horribly dysfunctional institutions, and it's not easy to fix. I have much more confidence in our ability to engineer solutions than mustering the necessary political and social coordination necessary to fix governments, policy, regulators and institutions.
- FabHK 4y ago
  Good analysis, and you are right. I think purely technical attempts to solve current political/social problems are doomed, while better institutions can and have been built. Now, what makes you think that the regulators in well-run countries will continue to accept this inefficient and unregulated money alternative full of scams? Crypto currencies could be banned to quite an extent (mining, on/off ramps, maybe even the network traffic, which is unencrypted, if I am not mistaken.)
  - junofan 4y ago
    It’s banned in China AFAIK and people seem to use it there all the time.
FabHK 4y ago
I think Paypal only got off the ground because the US banking system is so amazingly awful (compared to, say, continental Europe). Somewhat sad that it still seems to be the case.
kerng 4y ago
Maybe it will be like with China and cedit card usage. China just skipped credit cards and does everything in phone. They were behind, now they are leading the pack. Countries embracing crypto could go similar route.
- FalconSensei 4y ago
  another way to read that is that you are not able to get food if your phone dies
sdfhdhjdw3 4y ago
Sending money in the UK is faster than it takes me to open the app on the phone to confirm it went thru.
dghlsakjg 4y ago
He lives in Canada. Canadians don't live in the same country as Americans. Canadians don't have the same banks as Americans. Canadians can do money transfers instantly between any bank using e-transfer. He was talking about transferring money out of the Canadian network of banks to a foreign entity (guessing based on it being denominated in USD). As a European can you transfer money to, say, Vietnam without using clunky 40 year old technology like wires?
- Commodore63 4y ago
  The settlement delay isn't there for technological reasons. People think they want instant! fast! until they lose their life savings because libertarian tech has no buffers.
  - anony23 4y ago
    I thought the settlement delay was so that the banks can squeeze out 72 more hours of interest.
    - imtringued 4y ago
      No it is there for netting and clearing.
- spaceman_2020 4y ago
  International crypto transactions will likely be heavily regulated soon enough - the money laundering risk is too high. Not to mention that money send to a crypto wallet also needs to be cashed out locally, which takes both fees and time. And god forbid your crypto exchange goes bankrupt or decide to pause withdrawals
  - Ekaros 4y ago
    And the fact you are not moving insured money, but monopol money... Fiat really have quite many upsides when used with banks.
- 4y ago
sidpatil 4y ago
> Lacking that, maybe Americans will have to keep settling for all these clunky, incompatible intermediated patchwork solutions like Zelle and Venmo and USDC-on-Ethereum and whatever. FedNow is supposed to launch in 2023. https://www.frbservices.org/financial-services/fednow/about.html https://www.frbservices.org/financial-services/fednow/about....
ciupicri 4y ago
We must have different definitions of Europe because I live in Romania (which has been a member of the European Union since 2007) and yet even national transfers are not instantaneous if you're doing them in the evening, not to mention the weekend. And don't get me started with transfers to other European countries. I also think you meant cheap, not free. By the way I find it funny that some banks tax the receiver, so in order to get money, you have to lose money :-)
- bearmode 4y ago
  In the UK they're still usually instantenous in the evening, and also completely free.
  - ciupicri 4y ago
    Including for companies?
    - 7steps2much 4y ago
      Can't speak for the UK, but at least in Austria a company bank account is no different from a personal bank account, at least as far as technology is concerned. That said, I know at least a couple of (admittedly rather large/corporate) companies that explicitly opted out of instant transfers for some reason.
      - ciupicri 4y ago
        I can't comment on technologies, but the user interface for a business user might be different from that for a home user. As for fees, they tend to lure individuals with free this, free that, while taking kidneys and other organs from businesses.
- peoplefromibiza 4y ago
  SEPA is available in Romania.

by pavlov 4y ago

xur17 4y ago

> Sending money in Europe is free and increasingly often instantaneous 24/7. It will be very difficult for crypto to reach the level of convenience available on unified infrastructure created through sensible regulation. Lacking that, maybe Americans will have to keep settling for all these clunky, incompatible intermediated patchwork solutions like Zelle and Venmo and USDC-on-Ethereum and whatever. While true, I do think there is value in a permissionless protocol that anyone can plug into like this. Anyone in the world can send USDC to someone else (and any bank can integrate with this). The same can't be said for banking systems.

closewith 4y ago
While there is value in the avoidance of Anti-Money Laundering and Know Your Customer regulations, it's also not a feature that bodes well for the future lawfulness of the ecosystem.

axg11 4y ago

That's the point! Locally, there are great options almost everywhere. In Canada, I can e-transfer (Interac) anyone and the transfer is ~instant. Across borders the solutions are much worse. Crypto is the only payment rail that can realistically reach _everywhere_.

peoplefromibiza 4y ago
more than 350 billion/year travel from US to Europe as payments for exported goods. I think it already works... locally in EU means SEPA is available in 36 countries (includes some non-euro area and non-EU countries) and to more than 500 million people.
quonn 4y ago
And how often is that needed? And how often does it not also involve other issues, such as violating money laundering rules or tariffs? Crypto is the only payment rail that is practically accepted nowhere (I cannot use it to pay 99,99% of the places I do business with).

dcolkitt 4y ago

But that's the point, crypto is a coordination mechanism that in most cases serves as an alternative when you don't have effective and trustworthy centralized institutions. It's pretty clear that (in this case) European financial regulators did a good job coordinating an effective and efficient electronic money transmission system. But the whole world is not Sweden. Even in America, which is relatively first world with relatively decent institutions, our regulators failed to coordinate a decent electronic money transmission system. Now imagine being in Turkey or LatAm or Sri Lanka. (Or even just being in Europe and needing to interface with anywhere outside the European utopia.) Agree that decentralized protocols come with many inherent inefficiencies and frictions. But when institutions fail, the only alternative are decentralized protocols. In many ways I see the pro- vs. anti- crypto division coming down to how much people believe in institutions. Most crypto criticisms come down to an appeal to just focus on building better institutions rather than waste mountains of talent on overly complex decentralized protocols. "Instead of all this on-chain stablecoin nonsense, why don't we focus our efforts on electing better financial regulators, who can bring European like money transfers to North America and eventually the globe?" Whereas I think pro-crypto people (myself included), tend to think of any attempts to change public policy as /dev/null. Most of the world is saddled with horribly dysfunctional institutions, and it's not easy to fix. I have much more confidence in our ability to engineer solutions than mustering the necessary political and social coordination necessary to fix governments, policy, regulators and institutions.

FabHK 4y ago
Good analysis, and you are right. I think purely technical attempts to solve current political/social problems are doomed, while better institutions can and have been built. Now, what makes you think that the regulators in well-run countries will continue to accept this inefficient and unregulated money alternative full of scams? Crypto currencies could be banned to quite an extent (mining, on/off ramps, maybe even the network traffic, which is unencrypted, if I am not mistaken.)
- junofan 4y ago
  It’s banned in China AFAIK and people seem to use it there all the time.

FabHK 4y ago

I think Paypal only got off the ground because the US banking system is so amazingly awful (compared to, say, continental Europe). Somewhat sad that it still seems to be the case.

kerng 4y ago

Maybe it will be like with China and cedit card usage. China just skipped credit cards and does everything in phone. They were behind, now they are leading the pack. Countries embracing crypto could go similar route.

FalconSensei 4y ago
another way to read that is that you are not able to get food if your phone dies

sdfhdhjdw3 4y ago

Sending money in the UK is faster than it takes me to open the app on the phone to confirm it went thru.

dghlsakjg 4y ago

He lives in Canada. Canadians don't live in the same country as Americans. Canadians don't have the same banks as Americans. Canadians can do money transfers instantly between any bank using e-transfer. He was talking about transferring money out of the Canadian network of banks to a foreign entity (guessing based on it being denominated in USD). As a European can you transfer money to, say, Vietnam without using clunky 40 year old technology like wires?

Commodore63 4y ago
The settlement delay isn't there for technological reasons. People think they want instant! fast! until they lose their life savings because libertarian tech has no buffers.
- anony23 4y ago
  I thought the settlement delay was so that the banks can squeeze out 72 more hours of interest.
  - imtringued 4y ago
    No it is there for netting and clearing.
spaceman_2020 4y ago
International crypto transactions will likely be heavily regulated soon enough - the money laundering risk is too high. Not to mention that money send to a crypto wallet also needs to be cashed out locally, which takes both fees and time. And god forbid your crypto exchange goes bankrupt or decide to pause withdrawals
- Ekaros 4y ago
  And the fact you are not moving insured money, but monopol money... Fiat really have quite many upsides when used with banks.
4y ago

sidpatil 4y ago

> Lacking that, maybe Americans will have to keep settling for all these clunky, incompatible intermediated patchwork solutions like Zelle and Venmo and USDC-on-Ethereum and whatever. FedNow is supposed to launch in 2023. https://www.frbservices.org/financial-services/fednow/about.html https://www.frbservices.org/financial-services/fednow/about....

ciupicri 4y ago

We must have different definitions of Europe because I live in Romania (which has been a member of the European Union since 2007) and yet even national transfers are not instantaneous if you're doing them in the evening, not to mention the weekend. And don't get me started with transfers to other European countries. I also think you meant cheap, not free. By the way I find it funny that some banks tax the receiver, so in order to get money, you have to lose money :-)

bearmode 4y ago
In the UK they're still usually instantenous in the evening, and also completely free.
- ciupicri 4y ago
  Including for companies?
  - 7steps2much 4y ago
    Can't speak for the UK, but at least in Austria a company bank account is no different from a personal bank account, at least as far as technology is concerned. That said, I know at least a couple of (admittedly rather large/corporate) companies that explicitly opted out of instant transfers for some reason.
    - ciupicri 4y ago
      I can't comment on technologies, but the user interface for a business user might be different from that for a home user. As for fees, they tend to lure individuals with free this, free that, while taking kidneys and other organs from businesses.
peoplefromibiza 4y ago
SEPA is available in Romania.