3 ms·

A check is literally an instruction to a bank to talk to another bank and get some money, a process which, in the US, they usually complete by sending the check

A check is literally an instruction to a bank to talk to another bank and get some money, a process which, in the US, they usually complete by sending the check to a federal reserve clearinghouse. In what way does that give the parties directly participating in the transaction independent ‘control’?

mistrial9 4y ago
clearing the check is centralized obviously.. Think for a minute about the sequence of steps of a transaction. Payment for ________ upon the completion of _________; a third party escrow; conditional transactions of every flavor.
- jameshart 4y ago
  I guess by ‘independent’ you mean that with physical checks people are able to make up kind of ‘folk protocols’ for transactions involving steps like ‘party x holds on to a check written by party y’. - without the banks having to know that that’s what they’re doing, or having to involve some third party to handle that like PayPal or someone? That seems like a pretty weak argument for checks. The range of cases where those processes are useful, in terms of mutual trust (or lack thereof), quantities of funds involved, etc, seem pretty narrow. Like, I don’t trust you enough that I want to ask you to cut a check in advance, and I know you don’t trust me enough to not cash it right away so we’re going to have someone else hold it… but I trust you enough not to cancel the check, and that you’ll be holding sufficient funds so that when I do get the check I know it will actually clear… Surely we’d be better off using a proper escrow service for that? I get that pre-electronic-banking this sort of folk-banking was all people could do but it should be easy to do this sort of thing better electronically
  - mistrial9 4y ago
    weak => a check can be held while the electricity is out; while someone is having a health emergency; while someone changes their mind, their plans, their decision
mindslight 4y ago
OP overstated the case as being free of centralized parties, but checks do give individuals more rights - checks have been around long enough that even the US has had to develop sane regulations around them. Whereas digital payment services can just send you a text message saying "your whole account is frozen. see you in binding arbitration!". Maybe that will change in five decades, but it doesn't help us now.
- jameshart 4y ago
  It’s interesting that I guess I’m so used to reading takes on fintech touting ‘independence’ and ‘decentralization’ coming solely from a libertarian perspective which would assume that ‘government’ involvement was inherently centralized, it didn’t occur to me to consider that OP might actually believe in society, and consider law enforcement around check fraud and regulations on banks as something that enables individual freedom. Good reminder that sometimes it’s possible to read more into what someone’s saying than is there in the words.
  - mindslight 4y ago
    Well I can't speak for OP, but there are aspects of checks that are decentralized regardless of how brashly libertarian your perspective is. Like the idea that you yourself are effectively creating your own quasi-currency note by writing on a piece of paper, regardless of the machinery making it so that can work is more centralized. In general, there is much libertarian thinking that shortsightedly focuses on the unilateral "exit" without thinking about what comes next. It's a reaction to how complex and overbearing our institutions have become, spurred on by capital looking to digest the proceeds. I'm a libertarian, but I recognize that it's ultimately a yin-yang - if there is a "completely free" power vacuum, some other power will often fill it, creating a de facto government by another name - one that generally won't have any mechanisms of accountability. The approach of defining rights axiomatically simply does not work, due to the contradictions created by layered complexity. An example of how this plays out after the first step is the current web 2.0 catastrophe. The first amendment definition of free speech may be necessary, but it is not sufficient - unaccountable companies have consumed the power vacuum at scale, digested it, and spit it back out in terms of heavily editorialized spaces that we still try to use as if they're public venues. (And just to be clear on my immediate practical stance, I think the current "free speech" marketing campaign of Twitter et al is utterly specious. The problem is the amassing of such power in the first place, due to the centralizing technologies webapps are built on. Changing the flavor of the Kool-Aid doesn't fix the fundamental problem.)

mistrial9 4y ago

clearing the check is centralized obviously.. Think for a minute about the sequence of steps of a transaction. Payment for ________ upon the completion of _________; a third party escrow; conditional transactions of every flavor.

jameshart 4y ago
I guess by ‘independent’ you mean that with physical checks people are able to make up kind of ‘folk protocols’ for transactions involving steps like ‘party x holds on to a check written by party y’. - without the banks having to know that that’s what they’re doing, or having to involve some third party to handle that like PayPal or someone? That seems like a pretty weak argument for checks. The range of cases where those processes are useful, in terms of mutual trust (or lack thereof), quantities of funds involved, etc, seem pretty narrow. Like, I don’t trust you enough that I want to ask you to cut a check in advance, and I know you don’t trust me enough to not cash it right away so we’re going to have someone else hold it… but I trust you enough not to cancel the check, and that you’ll be holding sufficient funds so that when I do get the check I know it will actually clear… Surely we’d be better off using a proper escrow service for that? I get that pre-electronic-banking this sort of folk-banking was all people could do but it should be easy to do this sort of thing better electronically
- mistrial9 4y ago
  weak => a check can be held while the electricity is out; while someone is having a health emergency; while someone changes their mind, their plans, their decision

mindslight 4y ago

OP overstated the case as being free of centralized parties, but checks do give individuals more rights - checks have been around long enough that even the US has had to develop sane regulations around them. Whereas digital payment services can just send you a text message saying "your whole account is frozen. see you in binding arbitration!". Maybe that will change in five decades, but it doesn't help us now.

jameshart 4y ago
It’s interesting that I guess I’m so used to reading takes on fintech touting ‘independence’ and ‘decentralization’ coming solely from a libertarian perspective which would assume that ‘government’ involvement was inherently centralized, it didn’t occur to me to consider that OP might actually believe in society, and consider law enforcement around check fraud and regulations on banks as something that enables individual freedom. Good reminder that sometimes it’s possible to read more into what someone’s saying than is there in the words.
- mindslight 4y ago
  Well I can't speak for OP, but there are aspects of checks that are decentralized regardless of how brashly libertarian your perspective is. Like the idea that you yourself are effectively creating your own quasi-currency note by writing on a piece of paper, regardless of the machinery making it so that can work is more centralized. In general, there is much libertarian thinking that shortsightedly focuses on the unilateral "exit" without thinking about what comes next. It's a reaction to how complex and overbearing our institutions have become, spurred on by capital looking to digest the proceeds. I'm a libertarian, but I recognize that it's ultimately a yin-yang - if there is a "completely free" power vacuum, some other power will often fill it, creating a de facto government by another name - one that generally won't have any mechanisms of accountability. The approach of defining rights axiomatically simply does not work, due to the contradictions created by layered complexity. An example of how this plays out after the first step is the current web 2.0 catastrophe. The first amendment definition of free speech may be necessary, but it is not sufficient - unaccountable companies have consumed the power vacuum at scale, digested it, and spit it back out in terms of heavily editorialized spaces that we still try to use as if they're public venues. (And just to be clear on my immediate practical stance, I think the current "free speech" marketing campaign of Twitter et al is utterly specious. The problem is the amassing of such power in the first place, due to the centralizing technologies webapps are built on. Changing the flavor of the Kool-Aid doesn't fix the fundamental problem.)