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post operation choke point Visa, and MasterCard have been increasingly making moral and political judgments on who is allowed to transact. Even when the transac

post operation choke point Visa, and MasterCard have been increasingly making moral and political judgments on who is allowed to transact. Even when the transactions are perfectly legal. https://reclaimthenet.org/dick-masterson-new-project-2-mastercard/ https://reclaimthenet.org/dick-masterson-new-project-2-maste... This is a potential way around these behaviors. but I assume it will eventually be blocked by visa and MasterCard simply by threatening to blacklist stripe as a payment processor.

seydor 4y ago
How does Stripe sidestep this? Can people use VISA to pay pornhub through this portal? I dont think so , that would break Visa rules
- gnarbarian 4y ago
  I'm thinking through a potential pessimistic scenario here so take this with a grain of salt. let's say a verboten but legal business embeds this widget on their website. a user then uses their visa credit card to exchange for cryptocurrency and make a purchase. I believe Visa would argue that stripe is laundering money through cryptocurrencies to get around high risk payment processing. Visa could demand all cryptocurrency addresses associated with stripes embedded widget and compare that against known blacklisted destination addresses. It would do so under the guise of preventing terrorism, child exploitation, and money laundering. stripe is huge so rather than immediately cutting them off as is what happened to new project 2, I believe they would give stripe an ultimatum of sorts to remove the functionality, or demand stripe prevent transactions to any of the vague/subjective categories of businesses deemed high risk. The latter would likely be impossible because a high risk business could generate a new address easily which would only later be blacklisted and associated with the business landing stripe in breach of the agreement.
  - seydor 4y ago
    at best, visa requires people who participate to upload their government ID for such stuff. Stripe is not that big for them to care
  - vineyardmike 4y ago
    > believe Visa would argue that stripe is laundering money through cryptocurrencies to get around high risk payment processing > It would do so under the guise of preventing terrorism, child exploitation, and money laundering. It doesn't really care about these things all that much. I don't think this would realistically happen. But I doubt visa would be pleased about being a crypto on ramp. Most "high risk" credit card businesses (read: porn) are high risk due to charge-backs. Something Something about telling your wife you didn't actually pay for that... If you use crypto to buy porn... no chargebacks to the business, so the business isn't risky. The big risk becomes stolen credit cards, where StolenCC->Crypto becomes a perfect avenue to steal from Stripe/CC Company. You move the crypto, then let the CC owner charge-back stripe or the CC company for the funds. The thief gets to keep the crypto, the victim gets their money back, but the big corps have to eat the cost. That last bit (who loses) is why this project might die. Visa isn't really focusing on catching terrorism or whatever, they're trying to avoid chargebacks due to fraudulent behavior.
arcticbull 4y ago
What we actually need is federal regulation treating card networks as utilities that cannot discriminate against lawful transactions. We need payment network neutrality.
- analognoise 4y ago
  This is a way better solution than crypto charades/crypto shenanigans.
- RC_ITR 4y ago
  What you're thinking of are wire transfers. We have that already. You can argue that they need to be made faster (I agree), but V and MA aren't the reason why they're slow (banks being lazy and batching payments is). You may not like the logic, but the reason it was so easy for V and MA to cut porn is because the insane amount of porn chargebacks ("yeah I didn't make that purchase, it's fraud"). Crypto is just a wasteful overcomplicated bad solution that's worse than wire transfers, so I agree, let's work on visa-like payments on different rails with no fraud protections (so that way consumers can choose when they pay for that protection, rather than you and me subsidizing people who regret buying porn).
  - notch656a 4y ago
    That's an interesting take. The actual transfer is the one big upside I see of crypto over wire. And remember 'wire' is not a currency, we're comparing transfers here not the suitability of a currency ('wire' as an independent concept has none). I've done many wire transfers and many crypto transfers and the one consistent thing I've found is the crypto transfers are both cheaper and faster. If I could do crypto transfers with old school stable currency (not some cheesy stablecoin hoodwinker in the Bahamas) it'd be the holy grail.
    - toomuchtodo 4y ago
      FedNow instant payments?
    - RC_ITR 4y ago
RC_ITR 4y ago
Sure, but then just use wire transfers? You may not like the logic, but the reason it was so easy for V and MA to cut porn is because the insane amount of porn chargebacks ("yeah I didn't make that purchase, it's fraud"). A system without fraud protections (i.e. wires) is a much more efficient solution than a farm full of GPUs in Austin.
- meowkit 4y ago
  >A system without fraud protections (i.e. wires) is a much more efficient solution The assumption here of efficiency by any metric is the wrong thinking for crypto. Energy/speed are being optimized for, but they are not the goals. Wires don't have composability. Blockchains do. https://ethereum.org/en/developers/docs/smart-contracts/composability/ https://ethereum.org/en/developers/docs/smart-contracts/comp...
  - RC_ITR 4y ago
    Sigghhh. Why does composability require decentralization?
    - meowkit 4y ago
      It... doesn't.
twelve40 4y ago
wouldn't this simply replace MasterCard the Gatekeeper with Stripe? But Stripe also banned e.g. porn, so what is even the difference?
- roenxi 4y ago
  Mastercard handled the transaction. Stripe only handles the on-ramp into the ecosystem. Once the money is in crypto, Stripe loses the ability to influence what happens to it. 3rd parties lose a lot of traditional options to shut people down, that part of the crypto promise seems to have held.
ohgodplsno 4y ago
If you think Visa & MasterCard will be stumped because "oh no, they're not actually using our cards to pay for sex workers, they just buy a funny internet coin that can be used for many things including sex work", you're mistaken. They'll pressure Stripe into giving the list of purchases under threat of banning Stripe from their network if they don't cooperate, see that many have been made to "Porn Company Inc.", then threaten to ban Stripe from their network if they do not prevent such purchases. The way you get around the utterly stupid rules set by them is not through more technology layers. It involves a bit more physical violence at MasterCard HQ, as it always happened when unjust rules were made.

seydor 4y ago

How does Stripe sidestep this? Can people use VISA to pay pornhub through this portal? I dont think so , that would break Visa rules

gnarbarian 4y ago
I'm thinking through a potential pessimistic scenario here so take this with a grain of salt. let's say a verboten but legal business embeds this widget on their website. a user then uses their visa credit card to exchange for cryptocurrency and make a purchase. I believe Visa would argue that stripe is laundering money through cryptocurrencies to get around high risk payment processing. Visa could demand all cryptocurrency addresses associated with stripes embedded widget and compare that against known blacklisted destination addresses. It would do so under the guise of preventing terrorism, child exploitation, and money laundering. stripe is huge so rather than immediately cutting them off as is what happened to new project 2, I believe they would give stripe an ultimatum of sorts to remove the functionality, or demand stripe prevent transactions to any of the vague/subjective categories of businesses deemed high risk. The latter would likely be impossible because a high risk business could generate a new address easily which would only later be blacklisted and associated with the business landing stripe in breach of the agreement.
- seydor 4y ago
  at best, visa requires people who participate to upload their government ID for such stuff. Stripe is not that big for them to care
- vineyardmike 4y ago
  > believe Visa would argue that stripe is laundering money through cryptocurrencies to get around high risk payment processing > It would do so under the guise of preventing terrorism, child exploitation, and money laundering. It doesn't really care about these things all that much. I don't think this would realistically happen. But I doubt visa would be pleased about being a crypto on ramp. Most "high risk" credit card businesses (read: porn) are high risk due to charge-backs. Something Something about telling your wife you didn't actually pay for that... If you use crypto to buy porn... no chargebacks to the business, so the business isn't risky. The big risk becomes stolen credit cards, where StolenCC->Crypto becomes a perfect avenue to steal from Stripe/CC Company. You move the crypto, then let the CC owner charge-back stripe or the CC company for the funds. The thief gets to keep the crypto, the victim gets their money back, but the big corps have to eat the cost. That last bit (who loses) is why this project might die. Visa isn't really focusing on catching terrorism or whatever, they're trying to avoid chargebacks due to fraudulent behavior.

arcticbull 4y ago

What we actually need is federal regulation treating card networks as utilities that cannot discriminate against lawful transactions. We need payment network neutrality.

analognoise 4y ago
This is a way better solution than crypto charades/crypto shenanigans.
RC_ITR 4y ago
What you're thinking of are wire transfers. We have that already. You can argue that they need to be made faster (I agree), but V and MA aren't the reason why they're slow (banks being lazy and batching payments is). You may not like the logic, but the reason it was so easy for V and MA to cut porn is because the insane amount of porn chargebacks ("yeah I didn't make that purchase, it's fraud"). Crypto is just a wasteful overcomplicated bad solution that's worse than wire transfers, so I agree, let's work on visa-like payments on different rails with no fraud protections (so that way consumers can choose when they pay for that protection, rather than you and me subsidizing people who regret buying porn).
- notch656a 4y ago
  That's an interesting take. The actual transfer is the one big upside I see of crypto over wire. And remember 'wire' is not a currency, we're comparing transfers here not the suitability of a currency ('wire' as an independent concept has none). I've done many wire transfers and many crypto transfers and the one consistent thing I've found is the crypto transfers are both cheaper and faster. If I could do crypto transfers with old school stable currency (not some cheesy stablecoin hoodwinker in the Bahamas) it'd be the holy grail.
  - toomuchtodo 4y ago
    FedNow instant payments?
  - RC_ITR 4y ago

RC_ITR 4y ago

Sure, but then just use wire transfers? You may not like the logic, but the reason it was so easy for V and MA to cut porn is because the insane amount of porn chargebacks ("yeah I didn't make that purchase, it's fraud"). A system without fraud protections (i.e. wires) is a much more efficient solution than a farm full of GPUs in Austin.

meowkit 4y ago
>A system without fraud protections (i.e. wires) is a much more efficient solution The assumption here of efficiency by any metric is the wrong thinking for crypto. Energy/speed are being optimized for, but they are not the goals. Wires don't have composability. Blockchains do. https://ethereum.org/en/developers/docs/smart-contracts/composability/ https://ethereum.org/en/developers/docs/smart-contracts/comp...
- RC_ITR 4y ago
  Sigghhh. Why does composability require decentralization?
  - meowkit 4y ago
    It... doesn't.

twelve40 4y ago

wouldn't this simply replace MasterCard the Gatekeeper with Stripe? But Stripe also banned e.g. porn, so what is even the difference?

roenxi 4y ago
Mastercard handled the transaction. Stripe only handles the on-ramp into the ecosystem. Once the money is in crypto, Stripe loses the ability to influence what happens to it. 3rd parties lose a lot of traditional options to shut people down, that part of the crypto promise seems to have held.

ohgodplsno 4y ago

If you think Visa & MasterCard will be stumped because "oh no, they're not actually using our cards to pay for sex workers, they just buy a funny internet coin that can be used for many things including sex work", you're mistaken. They'll pressure Stripe into giving the list of purchases under threat of banning Stripe from their network if they don't cooperate, see that many have been made to "Porn Company Inc.", then threaten to ban Stripe from their network if they do not prevent such purchases. The way you get around the utterly stupid rules set by them is not through more technology layers. It involves a bit more physical violence at MasterCard HQ, as it always happened when unjust rules were made.