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5 cent per TX is actually expensive compared to some crypt solutions. Also fednow does not work outside the US currency system. You can not send USD and receiv

by noxer 4y ago

5 cent per TX is actually expensive compared to some crypt solutions. Also fednow does not work outside the US currency system. You can not send USD and receive EUR. But guess what, there are actually crypto solutions that can do that faster and cheaper than any bank can today. The trick is to go over crypto to bridge different fiat currency so you can exchange USD to EUR without a third party taking a fee for the exchange.

jqpabc123 4y ago
5 cent per TX is actually expensive compared to some crypt solutions. This is projected. Actual cost to consumers will depend on banks and how they choose to recover the cost. As an example, credit card transactions are much, much higher but a lot of consumers consider them *free* because they aren't charged directly. Yes, some crypto transactions may be cheaper --- for crypto swaps only. But crypto isn't a functioning currency. You can't rent a place to live in crypto-land. Compare apples to apples and look at the overall cost of doing an actual, end to end, real world transaction involving crypto (like paying rent) and 5 cents will start looking more attractive.
- noxer 4y ago
  Its irrelevant how much it will cost in the end. Moving fiat inside the same currency space is rather trivial, its just balances on a server in the end. Moving currencies across borders between different jurisdictions and currencies that is actually where the problems start and thus this is not cheap and not fast. People already use crypto as a bridge currency today to transfer "functioning currency" aka fiat. If you are in lets say Europa and you want to send money to Mexico You buy crypto send it there and sell it there for the local currency (Mexican Peso). This takes only a few minutes if done manually and you get the exchange rate of the market not some bad rate from a bank or payment provider. People do this since many years now circumventing banks and payment providers who would take a huge fee.
  - jqpabc123 4y ago
    People do this since many years now circumventing banks and payment providers who would take a huge fee. Take an individual case and add up all the end to end fees associated with doing this. Most likely, they are still huge. A lot of these people aren't really saving much money compared to traditional banking. They're doing this for convenience because they can't easily get a bank account or don't want one because they operate outside the system.
    - noxer 4y ago
      You can exchange USD to crypto with a spread of 0.1% (which statistically will be in your favor at least sometimes). Transfer is dirt cheap if you dont use the known high fee blockchains like BTC/ETH. A realistic fee is less then 1 cent per Tx. Then crypt back to fiat same thing 0.1% spread. Lets assume a worst case and you loose 0.5% for the 2 exchanges and 1 cent for the fee. So for 100 USD send that would mean 99.49 USD is revived For comparison moneygram's cheapest option for 100 USD to MXN would cost $2 fee (debit card fees not included and the exchange rate (spread) is unknown they give you whatever they want but certainly not anything better than 0.1%) So $102 send and less than $100 will be received and it takes up to 2 business days while the crypto solution takes minutes. Worst case example is still 4+ times cheaper while completely ignoring the exchange rate because you cant know in advance. And there are way more exotic currencies than MXN which makes the exchange more expensive. Not for crypto tho. If there is a market you get the real market exchange rate as is. The global remittance market moves billions with double digit growth yearly. If just a tiny fraction of all people use crypto for this (and they do) their saving sum up to millions.

by noxer 4y ago

jqpabc123 4y ago

5 cent per TX is actually expensive compared to some crypt solutions. This is projected. Actual cost to consumers will depend on banks and how they choose to recover the cost. As an example, credit card transactions are much, much higher but a lot of consumers consider them *free* because they aren't charged directly. Yes, some crypto transactions may be cheaper --- for crypto swaps only. But crypto isn't a functioning currency. You can't rent a place to live in crypto-land. Compare apples to apples and look at the overall cost of doing an actual, end to end, real world transaction involving crypto (like paying rent) and 5 cents will start looking more attractive.

noxer 4y ago
Its irrelevant how much it will cost in the end. Moving fiat inside the same currency space is rather trivial, its just balances on a server in the end. Moving currencies across borders between different jurisdictions and currencies that is actually where the problems start and thus this is not cheap and not fast. People already use crypto as a bridge currency today to transfer "functioning currency" aka fiat. If you are in lets say Europa and you want to send money to Mexico You buy crypto send it there and sell it there for the local currency (Mexican Peso). This takes only a few minutes if done manually and you get the exchange rate of the market not some bad rate from a bank or payment provider. People do this since many years now circumventing banks and payment providers who would take a huge fee.
- jqpabc123 4y ago
  People do this since many years now circumventing banks and payment providers who would take a huge fee. Take an individual case and add up all the end to end fees associated with doing this. Most likely, they are still huge. A lot of these people aren't really saving much money compared to traditional banking. They're doing this for convenience because they can't easily get a bank account or don't want one because they operate outside the system.
  - noxer 4y ago
    You can exchange USD to crypto with a spread of 0.1% (which statistically will be in your favor at least sometimes). Transfer is dirt cheap if you dont use the known high fee blockchains like BTC/ETH. A realistic fee is less then 1 cent per Tx. Then crypt back to fiat same thing 0.1% spread. Lets assume a worst case and you loose 0.5% for the 2 exchanges and 1 cent for the fee. So for 100 USD send that would mean 99.49 USD is revived For comparison moneygram's cheapest option for 100 USD to MXN would cost $2 fee (debit card fees not included and the exchange rate (spread) is unknown they give you whatever they want but certainly not anything better than 0.1%) So $102 send and less than $100 will be received and it takes up to 2 business days while the crypto solution takes minutes. Worst case example is still 4+ times cheaper while completely ignoring the exchange rate because you cant know in advance. And there are way more exotic currencies than MXN which makes the exchange more expensive. Not for crypto tho. If there is a market you get the real market exchange rate as is. The global remittance market moves billions with double digit growth yearly. If just a tiny fraction of all people use crypto for this (and they do) their saving sum up to millions.