4 ms·

Outside of drugs and ransoms, what actual commercial activity does cryptocurrency enable that justifies all the hype around it? It’s been 13 years since the Sat

Outside of drugs and ransoms, what actual commercial activity does cryptocurrency enable that justifies all the hype around it? It’s been 13 years since the Satoshi whitepaper and crypto is still flailing around for legitimacy. After a certain point, it’s probably safe to assume it’s all just techno quackery.

daveevad 4y ago
The send money to my relatives in South America without having to pay exorbitant transfer fees still seems pretty plausible to me.
- endisneigh 4y ago
  How much does it cost to send $1000 USD to South America using BTC and have them convert it to say, real, e.g. $1000USD to real via BTC vs other fiat methods. Using Wise you'd pay $15USD. Curious to know how much USD you'd pay with Bitcoin.
  - andrewflnr 4y ago
    The more relevant question is what it cost before people started using Bitcoin for that purpose. I think Bitcoin lit a fire under the major financial providers to be more efficient.
  - SXX 4y ago
    If you sent your USD to Argentine for insance you'll have to use official central bank exchange rate if you used Wise. With crypto you can actually convert your money using real world exchange rate which is very diffrent from official one. Official exchange rate: 1 USD = 162 Peso Real world one: 1 USD = 300 Peso
    - endisneigh 4y ago
      doesn't answer the question
      - seunosewa 4y ago
        You'll lose half of the value of your money if you send it the normal way. Crypto fees are unlikely be as high as 50%.
        endisneigh 4y ago
        This is not true, like I said, Wise will take $15USD for a $1000 transaction.
      - SXX 4y ago
        Answering your question. As far as I know you'll pay up to $2 for each Bitcoin transaction and you need two of them: when exchanging USD to BTC and when transfering your BTC to exchange. There of course might be price fluctuations, but this is exactly the reason why stablecoins are used and not BTC / ETH.
        endisneigh 4y ago
        that's not really an answer either. choose your exchange of choice. with coinbase it seems to be much more than $15USD. I don't see the value.
  - kragen 4y ago
    The situation differs a lot country by country. From you mention of the real, I assume you're talking about Brazil. I don't know anything about the current situation in Brazil, so I'll talk about Argentina and Venezuela instead. Maybe in Brazil you can just use the banking system and not have to worry about Bitcoin. TransferWise doesn't work here in Argentina. They have no locations, so you have to use an ATM, which gives you less than half of the money because it only gives out monopoly-money pesos, using the falsified "official" exchange rate. Western Union does cost about US$15, and uses the real exchange rate instead of the official one, but no Western Union location has US$1000 on hand. (The minimum wage, which is what most employees get paid, just got raised to $50000 a month in Argentine monopoly money, which is US$160.) You might be able to do it with five transactions of US$200. So figure somewhere around US$75, or more if you include the potential that WU employees will rob your house or attract attention from the tax authorities. Bitcoin transaction fees are commonly under US$1, especially if you don't need the transaction to go through in the next half-hour, but if you want to convert the Bitcoin into local monopoly money by going to a money changer, you can expect to pay about a 1%-2% spread. So probably about US$20. If you can do a peer-to-peer transaction instead of going to a money changer, you don't have to pay the spread. In Venezuela I don't think WU, TransferWise, or the banking system is an option, so it's not really a question of how much it costs without Bitcoin but what your chances of success are at all.
- haskellandchill 4y ago
  I send a fair amount to my gf in Venezuela. Bitcoin doesn’t help, the operator there prefers USD through Zelle and charges 10%, black market.
- knorker 4y ago
  What are the source of the fees? Legal compliance? IOW are your savings due to breaking, or loopholing laws?
- TMWNN 4y ago
  I was surprised last year to find that an intra-Coinbase BTC transfer was the cheapest way to send about $2,000 to Canada.
ogogmad 4y ago
All of the seasoned hedge fund managers are suggesting to avoid crypto. By seasoned, I mean with a 30-year record.
A4ET8a8uTh0 4y ago
Hmm. It is an interesting question. That said, does hype have to be justified though? I always considered hype to be its own force closer to marketing than commercial viability. Hype either is or isn't and it seems we are reaching the point where it may actually die off as a fair amount of people lose some cash. Naturally, it is hard to tell with any kind of certainty. <<is still flailing around for legitimacy. Here we disagree. The governments are seizing it, regulating it, trying to copy it for its own purposes. It already is legitimate simply because it is has people using it.
xyzzy4747 4y ago
It’s pretty good for remittances.
- ogogmad 4y ago
  To redeem them, you have to sell them. Somebody might be left holding the bag.
  - xyzzy4747 4y ago
    This is true for every commodity.
    - SgtBastard 4y ago
      All real-world commodities have an intrinsic utility value that backstops them, even if they can’t be on-sold. BTC’s intrinsic value is zero.
CyberDildonics 4y ago
Crypto curreny enables anyone to use money electronically without permission from a third party. It also enables anyone to plausibly invent their own currency. This might not solve any problems for you, but there are lots of problems it can solve. In the earlier days when bitcoin transaction fees were a few cents instead of a few dollars, paying for things on the internet was wonderful. No need to fill out forms and possibly get your credit card denied because you use a VPN and no need to worry about your number getting stolen now or down the road. No fees going to a credit card company and no hidden fees now or in the future. That utility is still there if a store takes multiple crypto currencies since only bitcoin has the throughput of a 28.8 dial up modem (1.16 KB/s). Ethereum has much more throughput but still has high fees. Anything else (litecoin, bitcoin cash, doge coin, monero etc.) will still give this utility, which is arguably the least impactful thing about crypto currency. The shame is that it is all such a mess it almost doesn't matter. People won't stop leaving their balances in exchanges or putting it in ponzi schemes, or terrible 'smart contracts' or anything else. People in general seem to want lottery tickets much more than they want a usable peer to peer electronic currency.
- WalterBright 4y ago
  > It also enables anyone to plausibly invent their own currency. People have been doing that for hundreds of years. It's still done regularly today. Writing a check is creating your own money. Issuing a coupon is creating your own money. Creating a credit card is issuing your own money. It goes on...
  - CyberDildonics 4y ago
    I think the burden of proof is going to have to be on you here because I don't think there is any way to bend definitions to make this true. You might be able to say the things you listed are IOUs, but they aren't ledgers, they won't scale and they can't be used without a central authority. There have been a few examples of people creating a centralized currency before bitcoin though. One was liberty dollars which was a single company that printed bills and claimed they could all be exchanged for gold (which was probably true, they went down from the US taking legal action and not any kind of default).
mccorrinall 4y ago
People rent servers at liteserver and vultr and pay for cheats on engineowning and donate to cock.li with btc. So, uh, it just works?
indigochill 4y ago
Theoretically, inexpensive international transfer of value (e.g. for citizens of low-wealth countries working abroad sending money back home) Assuming the sender/recipient's countries don't outlaw it or regulate it into parity with traditional banking. And only really uniquely useful if the sender/recipient doesn't already use the hawala system.
- knorker 4y ago
  > Assuming the sender/recipient's countries don't outlaw it or regulate it into parity with traditional banking. This raises an obvious question, though: Why would countries NOT regulate it like traditional banking? Notice how customs declarations say "more than $10'000 in money or financial instruments". Countries don't care about money specifically, they care about transfer of monetary instruments. Which means of course they care about BTC for international transfers. Maybe the laws are up to date, and maybe they're not, but it's perfectly clear that the intention of the laws is to include BTC, and it seems extremely likely that eventually they will be harmonized.

daveevad 4y ago

The send money to my relatives in South America without having to pay exorbitant transfer fees still seems pretty plausible to me.

endisneigh 4y ago
How much does it cost to send $1000 USD to South America using BTC and have them convert it to say, real, e.g. $1000USD to real via BTC vs other fiat methods. Using Wise you'd pay $15USD. Curious to know how much USD you'd pay with Bitcoin.
- andrewflnr 4y ago
  The more relevant question is what it cost before people started using Bitcoin for that purpose. I think Bitcoin lit a fire under the major financial providers to be more efficient.
- SXX 4y ago
  If you sent your USD to Argentine for insance you'll have to use official central bank exchange rate if you used Wise. With crypto you can actually convert your money using real world exchange rate which is very diffrent from official one. Official exchange rate: 1 USD = 162 Peso Real world one: 1 USD = 300 Peso
  - endisneigh 4y ago
    doesn't answer the question
    - seunosewa 4y ago
      You'll lose half of the value of your money if you send it the normal way. Crypto fees are unlikely be as high as 50%.
      - endisneigh 4y ago
        This is not true, like I said, Wise will take $15USD for a $1000 transaction.
    - SXX 4y ago
      Answering your question. As far as I know you'll pay up to $2 for each Bitcoin transaction and you need two of them: when exchanging USD to BTC and when transfering your BTC to exchange. There of course might be price fluctuations, but this is exactly the reason why stablecoins are used and not BTC / ETH.
      - endisneigh 4y ago
        that's not really an answer either. choose your exchange of choice. with coinbase it seems to be much more than $15USD. I don't see the value.
- kragen 4y ago
  The situation differs a lot country by country. From you mention of the real, I assume you're talking about Brazil. I don't know anything about the current situation in Brazil, so I'll talk about Argentina and Venezuela instead. Maybe in Brazil you can just use the banking system and not have to worry about Bitcoin. TransferWise doesn't work here in Argentina. They have no locations, so you have to use an ATM, which gives you less than half of the money because it only gives out monopoly-money pesos, using the falsified "official" exchange rate. Western Union does cost about US$15, and uses the real exchange rate instead of the official one, but no Western Union location has US$1000 on hand. (The minimum wage, which is what most employees get paid, just got raised to $50000 a month in Argentine monopoly money, which is US$160.) You might be able to do it with five transactions of US$200. So figure somewhere around US$75, or more if you include the potential that WU employees will rob your house or attract attention from the tax authorities. Bitcoin transaction fees are commonly under US$1, especially if you don't need the transaction to go through in the next half-hour, but if you want to convert the Bitcoin into local monopoly money by going to a money changer, you can expect to pay about a 1%-2% spread. So probably about US$20. If you can do a peer-to-peer transaction instead of going to a money changer, you don't have to pay the spread. In Venezuela I don't think WU, TransferWise, or the banking system is an option, so it's not really a question of how much it costs without Bitcoin but what your chances of success are at all.
haskellandchill 4y ago
I send a fair amount to my gf in Venezuela. Bitcoin doesn’t help, the operator there prefers USD through Zelle and charges 10%, black market.
knorker 4y ago
What are the source of the fees? Legal compliance? IOW are your savings due to breaking, or loopholing laws?
TMWNN 4y ago
I was surprised last year to find that an intra-Coinbase BTC transfer was the cheapest way to send about $2,000 to Canada.

ogogmad 4y ago

All of the seasoned hedge fund managers are suggesting to avoid crypto. By seasoned, I mean with a 30-year record.

A4ET8a8uTh0 4y ago

Hmm. It is an interesting question. That said, does hype have to be justified though? I always considered hype to be its own force closer to marketing than commercial viability. Hype either is or isn't and it seems we are reaching the point where it may actually die off as a fair amount of people lose some cash. Naturally, it is hard to tell with any kind of certainty. <<is still flailing around for legitimacy. Here we disagree. The governments are seizing it, regulating it, trying to copy it for its own purposes. It already is legitimate simply because it is has people using it.

xyzzy4747 4y ago

It’s pretty good for remittances.

ogogmad 4y ago
To redeem them, you have to sell them. Somebody might be left holding the bag.
- xyzzy4747 4y ago
  This is true for every commodity.
  - SgtBastard 4y ago
    All real-world commodities have an intrinsic utility value that backstops them, even if they can’t be on-sold. BTC’s intrinsic value is zero.

CyberDildonics 4y ago

Crypto curreny enables anyone to use money electronically without permission from a third party. It also enables anyone to plausibly invent their own currency. This might not solve any problems for you, but there are lots of problems it can solve. In the earlier days when bitcoin transaction fees were a few cents instead of a few dollars, paying for things on the internet was wonderful. No need to fill out forms and possibly get your credit card denied because you use a VPN and no need to worry about your number getting stolen now or down the road. No fees going to a credit card company and no hidden fees now or in the future. That utility is still there if a store takes multiple crypto currencies since only bitcoin has the throughput of a 28.8 dial up modem (1.16 KB/s). Ethereum has much more throughput but still has high fees. Anything else (litecoin, bitcoin cash, doge coin, monero etc.) will still give this utility, which is arguably the least impactful thing about crypto currency. The shame is that it is all such a mess it almost doesn't matter. People won't stop leaving their balances in exchanges or putting it in ponzi schemes, or terrible 'smart contracts' or anything else. People in general seem to want lottery tickets much more than they want a usable peer to peer electronic currency.

WalterBright 4y ago
> It also enables anyone to plausibly invent their own currency. People have been doing that for hundreds of years. It's still done regularly today. Writing a check is creating your own money. Issuing a coupon is creating your own money. Creating a credit card is issuing your own money. It goes on...
- CyberDildonics 4y ago
  I think the burden of proof is going to have to be on you here because I don't think there is any way to bend definitions to make this true. You might be able to say the things you listed are IOUs, but they aren't ledgers, they won't scale and they can't be used without a central authority. There have been a few examples of people creating a centralized currency before bitcoin though. One was liberty dollars which was a single company that printed bills and claimed they could all be exchanged for gold (which was probably true, they went down from the US taking legal action and not any kind of default).

mccorrinall 4y ago

People rent servers at liteserver and vultr and pay for cheats on engineowning and donate to cock.li with btc. So, uh, it just works?

indigochill 4y ago

Theoretically, inexpensive international transfer of value (e.g. for citizens of low-wealth countries working abroad sending money back home) Assuming the sender/recipient's countries don't outlaw it or regulate it into parity with traditional banking. And only really uniquely useful if the sender/recipient doesn't already use the hawala system.

knorker 4y ago
> Assuming the sender/recipient's countries don't outlaw it or regulate it into parity with traditional banking. This raises an obvious question, though: Why would countries NOT regulate it like traditional banking? Notice how customs declarations say "more than $10'000 in money or financial instruments". Countries don't care about money specifically, they care about transfer of monetary instruments. Which means of course they care about BTC for international transfers. Maybe the laws are up to date, and maybe they're not, but it's perfectly clear that the intention of the laws is to include BTC, and it seems extremely likely that eventually they will be harmonized.