I love that you asked this question! The very reason it doesn't happen often is because of friction inherent to legacy payment systems. Cryptocurrencies remove this friction in cross-border trade, hence are making such transactions more commonplace.
It's like you saying in 1890 "Why buy cars? People don't travel that much." But the invention of cars is precisely what increased the desire to travel.
"You have the right to a bank account in the EU"
What about the rest of the world? 6.6B humans?
"Currently Bitcoin is more expensive"
Not for transactions above approximately $100.
This argument presupposes what it tries to prove: the utility of cryptocurrencies.
There's no argument in there on why, if it was trivially possible due to cryptocurrency, the desire/need for international payments would increase.
“Banking the unbanked” is much discussed in international development circles. Around 2013, Bitcoin advocates started claiming that Bitcoin could help with this problem. Unfortunately:
* The actual problems that leave people unbanked are the bank being too far away, or bureaucratic barriers to setting up an account when you get there.
* Unless they use an exchange (which would functionally be a bank), they’d need an expensive computer and a reliable Internet connection to hold and update 120 gigabytes of blockchain.
* Bitcoin is way too volatile to be a reliable store of value.
* How do they convert it into local money they can spend? Pretty much nobody accepts bitcoin.
* 7 transactions per second worldwide total means Bitcoin couldn’t cope with just the banked, let alone the unbanked as well.
* A centralised service similar to M-Pesa (a very popular Kenyan money transfer and finance service for mobile phones) might work, but M-Pesa exists, works and is trusted by its users – and goes a long way toward solving the problems with access to banking that Bitcoin claims to.
Advocates will nevertheless say “but what about the unbanked?” as if Bitcoin is an obvious slam-dunk answer to the problem and nothing else needs to be said. But no viable mechanism to achieve this has ever been put forward.
Bitcoin, being electronic, precisely helps with people being far away from bank branch offices.
Bitcoin SPV wallets run on $10 Android smartphones. No need for an "expensive computer".
"Bitcoin is way too volatile to be a reliable store of value" Still better than being unbanked/underbanked. Also, volatility has been decreasing: https://mobile.twitter.com/lsukernik/status/8649208737189519...
"How do they convert it into local money they can spend? " As Bitcoin adoption increases, there is less and less need to convert it. Today 160k+ merchants accept it. 8 years ago it was 0.
"* 7 transactions per second worldwide total means Bitcoin couldn’t cope with...*" This limit is obviously not set in stone and will increase one way or another: segwit, block size increase, payment channels, etc.
Some of your points are well thought out, but I couldn't leave this one alone.
The vast majority of bitcoin users don't use a bitcoin exchange to store their coins. They also don't download the entire blockchain.
SPV wallets exist (like electrum or the android bitcoin wallet) that give the user complete control over their private keys without needing a copy of the blockchain or using substantial bandwith.
https://en.bitcoin.it/wiki/Electrum
https://en.wikipedia.org/wiki/Bitcoin_network#Payment_verifi...
I couldn't find numbers on this when I went looking, but that's a numerical claim. Do you have numbers on this?
Blockchain.info claims to be the most popular web wallet with 10M users and users have control of their own keys without needing to run a node. Their android app has 1-5M downloads.
The Mycelium wallet for android has 100k-500k downloads.This is an SPV wallet like electrum, where users have control of their keys without needing to run a node.
Bitpay's wallet for android also has 100k-500k downloads, which is an SPV wallet.
The generic bitcoin wallet for android (also SPV) has 1-5M installs.
Multibit (also SPV) is the only desktop client that posts statistics but it claimed 1.5 million downloads in 2014. Now that multibit is discontinued (and bitcoin has gotten more popular since 2014) it's fairly safe to assume that electrum has numbers quite a bit higher than that. I suspect (although I can't prove) that electrum is more popular than all of the android wallets--It's even packaged in TAILS by default.
For comparison, the only popular wallet where users DON'T have control of their keys is the coinbase wallet with 9 million accounts. Other exchanges exist, and may have higher volume, but they don't market themselves as wallets to users.
There are less than 10,000 full nodes running at any given time--and a large amount of that is running 24/7. Its safe to say full-chainers are in the minority if you do some guesstimation.
I got most of these figures from the google play store.
Perhaps I'm misunderstanding what is meant by "international payment", but surely for a majority of people this is just an irrelevance? I can't imagine my parents have ever needed to make an international payment, for instance.
I have an employee in Iran and my goodness was it hard to work out how to pay him (Iranian banks don't have SWIFT and IBAN and helpful things like that), and Bitcoin did actually seem like a legitimate option at one point, until we realised that between business banking and accounting, it was also going to be really hard to do - so I would love for this new wave of currencies to make international payments easier. But I just don't think it's of very much significance to many people in the grand scheme of things. 54% of Americans apparently don't have a passport; are these people really going to be making regular international payments, more than about once a lifetime?
(The significant number of "digital nomads" on HN who work from a beach in Thailand are really not representative!)
However, if we're taking "international payment" to mean "an easy way to take out/spend money when you're on holiday without getting stung by exchange rates and assorted complexities" then I will certainly grant you that this would be broadly regarded as a mainstream benefit (though, again, I guess those 54% of Americans would probably disagree).
My parents are also moving abroad in the next few months and I'll be very surprised if we don't end up struggling to move money around at some point, even if it's only a minor issue.
I think the reason it doesn't happen often is that most people have no need to send money internationally when all the things they might want to buy are readily available locally or online. Of course there are people who do it all the time, but it's not "mainstream" and I don't see it becoming so.
All these fees are wasted money from my point of view, and the sooner I can stop paying them, the better.
You and I are not the user demographic ;)
Some of the top receiving countries include France, Germany or Belgium (over $1000 per inhabitant) and the top sending countries include Luxembourg ($12B for a population of 575K).
So the numbers probably include cross-border workers. People living in France/Germany/Belgium but working in Luxembourg. Transferring euros within the SEPA region (for free) for at least $50B out of the $560B mentioned.
That strikes me as an appealing use case.
About an hour ago. I'm on holiday ftw.
But even not on holiday ... Quite often. With an extortionate credit card fee.
When was the last time you made an international payment? I never made a payment outside of the EU and inside the EU I already have free wire transfers. For most people this is not interesting.
> unbanked/underbanked
You have the right to a bank account in the EU.
> Allowing merchants to save 2% in credit card fees
Currently Bitcoin is more expensive for typical transactions. And there's direct debit which is practically free at least here in Germany.