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If they want stable currency they could just buy dollars. Why would they want to buy a high risk currency instead? The only possible outcome of this is you rigg
by MagicMoonlight 2y ago
If they want stable currency they could just buy dollars. Why would they want to buy a high risk currency instead? The only possible outcome of this is you rigging them.
- maxilevi 2y agoIn some countries its illegal to buy dollars due to currency controls.
- snarf21 2y agoCan't the same countries also just make all the on-ramps and off-ramps just as illegal?
- donatj 2y agoIt's easier and safer to use a VPN than it is to meet a man in a dark alley for some dollars.
- dowager_dan99 2y agoyou still have to fund your stablecoin account somehow - how do I get local currency from my pocket into the ether?
- jeffparsons 2y agoCrime. The answer is crime. (Plus a whole bunch of pretty words to make it sound like they're saving the world.)
- Shasnani 2y agoYou'd use our platform! User A sends local currency to User B's fiat account. User B sends stablecoins (earned via salary, trading, mining, etc.) to User A's digital wallet (that we've created for them).
- thaumasiotes 2y agoAssuming you get banned, is your plan just "never visit any country where we do business"?
- Shasnani 2y agoHahaha we've had this conversation internally a couple of times. Definitely a few places that we'd probably avoid. But also plenty of others (e.g., Kenya, LatAm, Turkey, etc.) that have been quite friendly and would be fine to visit.
- goatsi 2y agoDoes user B need any sort of exchange/money transmitter license? Do you check the laws for this in each country you are available in? Do you notify user B of this fact and the potential legal risks? Do you verify if they have the license?
- Shasnani 2y agoUser B is sending a peer-to-peer transaction, akin to a Zelle or Venmo. In most other countries, these peer-to-peer payments (PIX, UPI, etc.) do billions of transactions per month. And since you're sending your own funds, you're not a money transmitter. If we do work with any larger entities (e.g., an OTC desk, liquidity provider), we'd certainly be cognizant of the relevant licensing.
- pigeons 2y ago> And since you're sending your own funds, you're not a money transmitter. It's MUCH more complicated than that in several countries, particularly the US.
- threeseed 2y agoAnd what are the legal implications for User B. Because if you are involved in washing illegally earned money in many places that's a criminal act.
- awesome_dude 2y agoThen... just open an account in a US bank using said VPN, instead of going through a middleman who will fall over and take the lot next week
- crummy 2y agoCan you do that without a US postal address?
- awesome_dude 2y agolol, I think that anything you say about not being able to open a US bank account applies to the platform that is supposed to KYC
- neucoas 2y ago"Just open a US bank account using a VPN, duh" It's so funny to read Americans who constantly downplay the problems that people in developing countries have
- awesome_dude 2y agoSorry about the delay in responding - but how is "Just use a crypto wallet" any better? What I probably should have said was that the platform should be offering a USD (or Euro, or whatever) denominated account, much easier for trading.
- csomar 2y agoYou on-ramp/off-ramp with P2P (aka just another guy). It is illegal but how can a government control that?
- threeseed 2y agoThe government wouldn't bother with the individuals. They would designate Karsa as a criminal organisation. And then trigger an Interpol Red Notice for the founders.
- echelon 2y agoAs I understand it, stablecoins are three things: 1. a means of bypassing US sanctions 2. a means of bypassing the US dollar / Western order during international trade 3. a means of transacting without Visa, Mastercard, Chase; cutting out banks and fintechs and their margins. Stablecoins are pitched to investors as #3, but are more frequently used as #1 and #2. If stablecoins catch on and can build a large network, it poses a real threat to American hegemony. You wouldn't need the dollar for international trade or settlement. You could trade, move large balances, etc. in stablecoins and never need to hold dollar reserves. It's wild to see the US funding and developing this tech.
- benatkin 2y agoIt’s individualism. Wild, but not so surprising to me. For instance, I want people to be able to choose what OS they use on their computers and I’d be happy to see more desktop and laptop computers sold without Windows included even if it hurts the US economy.
- Gothmog69 2y agoStable coins hold dollars (bonds usually) IIRC they are amongst the largest US bond holders
- Shasnani 2y agoI see this take a lot, and there's some truths to it, but I'd like to take the other side of the argument. These stablecoin issuers are enormous buyers of US treasuries: "Tether Holdings owned $97.6 billion worth of US Treasuries in June 2024, a new high. Hence, Tether now owns more US Treasuries than the governments of Germany, the United Arab Emirates (UAE), and Australia. Hence, Tether is now the 18th largest holder of US Treasury bonds" (https://medium.com/coinmonks/tether-usdt-is-the-third-largest-buyer-of-us-treasury-bonds-a91374a93a7a https://medium.com/coinmonks/tether-usdt-is-the-third-larges...) Dollars are also more dominant as a reserve currency in stablecoins (~97%) than they are in real-world trade (https://digitalchamber.org/stablecoinreport/ https://digitalchamber.org/stablecoinreport/). I.e., we see stablecoins as extending dollar dominance, not reducing it.
- 2y ago
- benatkin 2y agoThe word stable doesn’t appear once in the post except for within the word stablecoin. It’s important to get past the name. It’s a pegged coin, the attempted stability is in terms of it being pegged, and people need to do their research on how well a coin achieves that just like with all of DeFi.
- krupan 2y agoPegged to the US Dollar, which is not stable, but maybe the least volatile Fiat currency in the world, so it's an upgrade for most people. I just worry about the nature of these pegged crypto currencies. Are they really safe?
- Jolter 2y agoTBF I think 1% is less than most currency exchanges charge. Plus what the post says about restrictions on foreign currencies for a lot of people in developing nations.
- thaumasiotes 2y agoWell, if you're going to a little booth in the airport, or having a foreign cashier bill you in your native currency, sure, you're going to get fleeced. I have a Capital One credit card that was advertised as "no foreign exchange fees", and its exchange fee is 1%. I wish it would stop lying about the absence of fees, but I can live with the 1% fee.
- Shasnani 2y agoSo the entire premise is that you really can't just 'buy dollars' in the majority. of these countries, hence the need for stablecoins. And I don't think I would characterize this as a high-risk currency; it's essentially a digital receipt for a dollar, backed by US treasuries (https://www.circle.com/transparency https://www.circle.com/transparency).
- davidlee1435 2y agoadding onto this, i as a citizen of <high inflation country> who buys dollars from the national bank are probably holding digital dollar receipt anyways, since most foreign dollar holdings are held in nostro accounts at US correspondent banks. if you trust your banking system to be a better custodian of your money than Circle, you're one of the lucky ones. billions of people in the world don't have that kind of luxury (see: https://www.bbc.com/news/world-asia-68778636 https://www.bbc.com/news/world-asia-68778636), hence a part of the reason why stablecoins have grown to a little under a quarter trillion
- deleted 2y ago[deleted]
- aorloff 2y agoSo the app essentially offers anyone in an emerging market the "regional exchange rate" you can find for their currency ? If I have a wad of tea shillings, how do I use this app to hold stablecoins ?
- roywiggins 2y agoymmv on that, unless you're buying physical cash to put under the mattress: https://www.aljazeera.com/economy/2022/2/3/lebanon-us-dollar-savers-fear-theyll-foot-crisis-bill https://www.aljazeera.com/economy/2022/2/3/lebanon-us-dollar... (even if you can set up dollar-denominated accounts at a domestic bank, that doesn't mean your claim will be honored. stablecoins aren't dollars but they might be more stable than your average dollar-denominated bank account in some countries)
- jjallen 2y agoYou really think it’s trivial to buy AND hold dollars safely in every country around the world? Even I as an American has known so many people from countries like Argentina where just maintaining your bank balance is basically impossible due to inflation and currency controls. Believing that this is easy or solved is a very Americentric viewpoint. Unfortunately with money there will always be good and bad guys with it. We all need it. Have to do the best we can with not assuming everyone is a criminal re money laundering.
- woah 2y agoDid you even read the post? They are buying dollars
- ThePowerOfFuet 2y agoRigging or rugging?