4 ms·

Under-banked does not mean they have no money. They obviously have some money or they would starve. Many live paycheck-to-paycheck and give 3% of their wages to

Under-banked does not mean they have no money. They obviously have some money or they would starve. Many live paycheck-to-paycheck and give 3% of their wages to a check cashing service. If it were as easy as you seem to think for them to get a bank account, those check cashing businesses all around the country would not exist.

arcticbull 3y ago
Indeed the problem is they don't have enough money. Regardless this is a problem for congress. If we're sure they have enough money, this has historically been solved with postal banking. Let's just re-start that. [1] Check cashing isn't just about cashing the check, it's a predatory short-term lending facility. Actually cashing a check is a solved problem. And again, not addressed by crypto. [1] https://en.wikipedia.org/wiki/United_States_Postal_Savings_System https://en.wikipedia.org/wiki/United_States_Postal_Savings_S...
- overthrow 3y ago
  You're right, this is a job for the government... but the government isn't solving the problem. "Let's just" have the government do their job. Call me when that happens. While we sit around waiting, the private sector stepped in with a (interim?) solution. What's wrong with that?
  - arcticbull 3y ago
    The (a) scams and (b) insane volatility. The folks you are alluding to who fall into this category are the least sophisticated and most desperate. This makes them easy marks. They shouldn't be buying into unregistered securities to resolve their banking problems. That's how we got the Great Depression and why we not have an SEC. Further, these folks are disproportionately affected by the insane volatility and high fees of the crypto space. These so-called financial products are just proxies for US dollar liquidity in the global financial system. If we had to write a prospectus I don't know anyone who isn't a money manager who could figure out how to actually deploy this sensibly. Let alone a homeless person without an address. How are they to 'do their own research'? Something that makes the problem worse isn't a substitute for a proper solution. In the US you generally need an account at an AML/KYC exchange to buy crypto for dollars and a bank account, so already we're off to a bad start. Or you can use a bitcoin ATM, which costs like 20%, dramatically worse than predatory lenders.
    - overthrow 3y ago
      Maybe instead of saying what people should and shouldn't be doing, you should ask yourself why they're using it anyway despite the obvious downsides. Lightning fees are less than $0.01 - much better than the alternative of $20 for cashing a check. And the volatility is a small price to pay for financial control, for someone who (with good reason) doesn't trust banks or the government that's failing them. Actually the easiest way the government could kill crypto would be to get rid of the corruption and help those "undesirables" with their problems, instead of making them fend for themselves. I'm not holding my breath, but in a way I hope that happens.
      - arcticbull 3y ago
        > Maybe instead of saying what people should and shouldn't be doing, you should ask yourself why they're using it anyway despite the obvious downsides. They're not using it, at all. Trading volumes have plummeted, nobody uses it for exchange of value due to the volatility and the fees. You wouldn't say people are 'using Apple' because they're holding Apple stock, and you shouldn't say people are 'using Bitcoin' because they're holding onto it in a portfolio they've probably written off due to massive losses. > Lightning fees are less than $0.01 - much better than the alternative of $20 for cashing a check. And the volatility is a small price to pay for financial control, for someone who (with good reason) doesn't trust banks or the government that's failing them. (a) Lightning is totally unsustainable because it requires you complete an on-chain transaction to open a channel, which would take about 75 years, trillions of dollars and all the remaining block reward to do for everyone on earth. It would even take months to open a channel for everyone in the Bay Area. Then it suffers from quadratic routing complexity, and offers few if any of the guarantees of the underlying chain. (b) It's not the replacement for $20 check cashing, that's a loan, a cash advance. That's what you're paying for. You can cash checks for free at any online bank. > And the volatility is a small price to pay for financial control, for someone who (with good reason) doesn't trust banks or the government that's failing them. It's literally down 60% from a year ago (almost 70% adjusting for inflation). By any objective or subjective measure that's a "big price to pay" for anyone who purchased last year. So no, it's not. You yourself called these people out as 'living paycheck to paycheck' so by definition your own users would be utterly rekt using what you're advocating for. Setting aside the 'crypto' third-rail, what if I came up with a way for anyone without AML or KYC to buy and sell shares of GameStop. Would you then immediately tell me that poor people should use shares of GameStop as money? In Africa? I suspect that would be viewed as overwhelmingly predatory.

arcticbull 3y ago

Indeed the problem is they don't have enough money. Regardless this is a problem for congress. If we're sure they have enough money, this has historically been solved with postal banking. Let's just re-start that. [1] Check cashing isn't just about cashing the check, it's a predatory short-term lending facility. Actually cashing a check is a solved problem. And again, not addressed by crypto. [1] https://en.wikipedia.org/wiki/United_States_Postal_Savings_System https://en.wikipedia.org/wiki/United_States_Postal_Savings_S...

overthrow 3y ago
You're right, this is a job for the government... but the government isn't solving the problem. "Let's just" have the government do their job. Call me when that happens. While we sit around waiting, the private sector stepped in with a (interim?) solution. What's wrong with that?
- arcticbull 3y ago
  The (a) scams and (b) insane volatility. The folks you are alluding to who fall into this category are the least sophisticated and most desperate. This makes them easy marks. They shouldn't be buying into unregistered securities to resolve their banking problems. That's how we got the Great Depression and why we not have an SEC. Further, these folks are disproportionately affected by the insane volatility and high fees of the crypto space. These so-called financial products are just proxies for US dollar liquidity in the global financial system. If we had to write a prospectus I don't know anyone who isn't a money manager who could figure out how to actually deploy this sensibly. Let alone a homeless person without an address. How are they to 'do their own research'? Something that makes the problem worse isn't a substitute for a proper solution. In the US you generally need an account at an AML/KYC exchange to buy crypto for dollars and a bank account, so already we're off to a bad start. Or you can use a bitcoin ATM, which costs like 20%, dramatically worse than predatory lenders.
  - overthrow 3y ago
    Maybe instead of saying what people should and shouldn't be doing, you should ask yourself why they're using it anyway despite the obvious downsides. Lightning fees are less than $0.01 - much better than the alternative of $20 for cashing a check. And the volatility is a small price to pay for financial control, for someone who (with good reason) doesn't trust banks or the government that's failing them. Actually the easiest way the government could kill crypto would be to get rid of the corruption and help those "undesirables" with their problems, instead of making them fend for themselves. I'm not holding my breath, but in a way I hope that happens.
    - arcticbull 3y ago
      > Maybe instead of saying what people should and shouldn't be doing, you should ask yourself why they're using it anyway despite the obvious downsides. They're not using it, at all. Trading volumes have plummeted, nobody uses it for exchange of value due to the volatility and the fees. You wouldn't say people are 'using Apple' because they're holding Apple stock, and you shouldn't say people are 'using Bitcoin' because they're holding onto it in a portfolio they've probably written off due to massive losses. > Lightning fees are less than $0.01 - much better than the alternative of $20 for cashing a check. And the volatility is a small price to pay for financial control, for someone who (with good reason) doesn't trust banks or the government that's failing them. (a) Lightning is totally unsustainable because it requires you complete an on-chain transaction to open a channel, which would take about 75 years, trillions of dollars and all the remaining block reward to do for everyone on earth. It would even take months to open a channel for everyone in the Bay Area. Then it suffers from quadratic routing complexity, and offers few if any of the guarantees of the underlying chain. (b) It's not the replacement for $20 check cashing, that's a loan, a cash advance. That's what you're paying for. You can cash checks for free at any online bank. > And the volatility is a small price to pay for financial control, for someone who (with good reason) doesn't trust banks or the government that's failing them. It's literally down 60% from a year ago (almost 70% adjusting for inflation). By any objective or subjective measure that's a "big price to pay" for anyone who purchased last year. So no, it's not. You yourself called these people out as 'living paycheck to paycheck' so by definition your own users would be utterly rekt using what you're advocating for. Setting aside the 'crypto' third-rail, what if I came up with a way for anyone without AML or KYC to buy and sell shares of GameStop. Would you then immediately tell me that poor people should use shares of GameStop as money? In Africa? I suspect that would be viewed as overwhelmingly predatory.