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This is the shittiest article I've read on HN to date. Remittance not useful because of currency exchange spreads? Well then no currencies are useful for remit

by atlih 12y ago

This is the shittiest article I've read on HN to date. Remittance not useful because of currency exchange spreads? Well then no currencies are useful for remittance. As for the illegal part, are US dollars not useful for Drugs, Gambling, Tax Evasion and Escaping capital controls anymore? So then, when was the last time some one used US Dollars for any of the illegal activities above? The news didn't reach me.

exelius 12y ago
I think the argument against the remittance case is that if you're going USD->BTC->EUR, you're probably better off just going USD->EUR because it doesn't expose you to the risk of BTC. I actually disagree with this; the remittance case can be quite useful when the government has an artificial exchange rate that disagrees with reality. Maybe that falls under the "illegal" category. But as for illegal uses, the US dollar is useful for drugs, gambling, etc. specifically because it's very useful in legal transactions as well. There's a chicken and egg problem: most people don't engage in illegal activity, but right now if you use BTC it's a red flag that something illegal is going on. If you want BTC to be really useful for illegal transactions, it needs to be useful for legal ones and gain wider adoption. That was my reading of it, anyway.
- pbreit 12y ago
  USD to EUR is not interesting at all. It's the thousands of combinations of the other 200 currencies that are.
  - exelius 12y ago
    Right, but what is the upside of using XXX->BTC->YYY instead of XXX->USD->YYY? In the instances where there is no liquid market of XXX or YYY to USD, it is highly unlikely that there will be a liquid market of XXX or YYY to BTC. If conversion between XXX and USD is illegal, then BTC is essentially being used to avoid local laws, and falls under the "illegal" category the author described. BTC would be a great intermediary currency if there wasn't one already in the form of USD. I just don't see any advantage that BTC would offer over USD, even in the presence of high levels of BTC liquidity (assuming nothing catastrophic happens to the USD, of course).
pbreit 12y ago
I don't agree totally with the article bit it is very, very far from shitty. The arguments are reasonable and it is well-referenced. I'm just not sure it's reaching the right conclusion.

by atlih 12y ago

exelius 12y ago

I think the argument against the remittance case is that if you're going USD->BTC->EUR, you're probably better off just going USD->EUR because it doesn't expose you to the risk of BTC. I actually disagree with this; the remittance case can be quite useful when the government has an artificial exchange rate that disagrees with reality. Maybe that falls under the "illegal" category. But as for illegal uses, the US dollar is useful for drugs, gambling, etc. specifically because it's very useful in legal transactions as well. There's a chicken and egg problem: most people don't engage in illegal activity, but right now if you use BTC it's a red flag that something illegal is going on. If you want BTC to be really useful for illegal transactions, it needs to be useful for legal ones and gain wider adoption. That was my reading of it, anyway.

pbreit 12y ago
USD to EUR is not interesting at all. It's the thousands of combinations of the other 200 currencies that are.
- exelius 12y ago
  Right, but what is the upside of using XXX->BTC->YYY instead of XXX->USD->YYY? In the instances where there is no liquid market of XXX or YYY to USD, it is highly unlikely that there will be a liquid market of XXX or YYY to BTC. If conversion between XXX and USD is illegal, then BTC is essentially being used to avoid local laws, and falls under the "illegal" category the author described. BTC would be a great intermediary currency if there wasn't one already in the form of USD. I just don't see any advantage that BTC would offer over USD, even in the presence of high levels of BTC liquidity (assuming nothing catastrophic happens to the USD, of course).

pbreit 12y ago

I don't agree totally with the article bit it is very, very far from shitty. The arguments are reasonable and it is well-referenced. I'm just not sure it's reaching the right conclusion.