As I understand I need to do something that's pretty much exactly like opening a bank account, but transactions take forever, they cost money, and the currency is not accepted by any business I use, unlike my free credit card.
I have 55€ in my wallet and everyone on this continent knows what to do with it.
Sometimes you have to transfer money in and out of the country at war with it’s currency in free fall and capital controls in place. At times like that “normal” ways take about 30% of the sum as transactional overhead, while bitcoin doesn’t.
Sometimes “normal“ ways just don’t work normally. Sometimes your government is actively working against your ability to transfer your money for whatever reason — be it drug laws or capital controls or what not. Sometimes you enter account number into the “normal“ system and field just turns red for no reason at all. Sometimes you have your access to “normal“ system severely restricted because of your legal status and residency rights.
So yeah transferring money between Canada and US being resident of either of them and not doing anything funny — is not a use case for Bitcoin.
Seriously in reality the specifics of any sort of wild situation like the one you describe matter. Which countries? Which currency? Which kind of illegal behavior?
And (I ask out of ignorance) in this scenario you describe why would whatever group managing whatever bitcoin exchange or whatever is being used remain virtuous and not charge a 30% markup themselves?
That indeed is a bunch of real situations that have happened to me in 2014-2015 and some of that is still a thing. Check your privileges, sweet summer child.
Like seriously — for the first 30 years of my life it was outright illegal to have a bank account in a foreign country in my name. Not enforceable in practice, except I can’t make wires between two.
So 2014, fucking Russia is being Russia again, USD wired from foreign clients goes in... and is sold for UAH at government mandated rate. I sit in a third country, withdraw it through ATM. Guess what? It is converted back to USD at a market rate. Of course you can still bring cash or btc in and sell it at market rate plus some margin, but not 30 damn percent.
Sometimes it’s less dramatic and web interface of your bank doesn’t have regexp for IBAN format of destination country. Ridiculous but have happened as well, so I have proxied IBAN that starts with GB instead of UA and that always works.
Please don't do this here. It is needlessly condescending and insulting.
"Does this hypothetical situation you describe exist anywhere outside of the hypothetical situation posited by a character in a Neal Stephenson novel"
But, like, the classic "society could collapse" fear-and-doubt, doom-and-gloom, grab-the-gold-and-the-burner-laptop-and-the-ammo argument can be used for just about anything.
Heck, even when society actually is collapsing, the argument isn't actually that great an argument!
I'm not even arguing that cryptocurrency couldn't have value in the scenario you describe. Just that genuine, specific, examples are more compelling than generalized scenarios. Generally speaking ; )
For example, all of the more specific examples folks talk about below (Argentina, etc).
Plus the parent poster made fair points, based on my limited knowledge, about accountability issues with cryptocurrency. And trust. Especially for nontechnical folk, and even for technical folk. Even (especially!) when society is collapsing, there's always someone out to scam you ...
For arguments sake, if someone is in the scenario you describe, what are good initial resources for a nontechnical person? For instance, should I use something like a coinbase wallet?
https://www.reddit.com/r/BitcoinBeginners/comments/fdykz3/is...
Then again people who I talked to in 2014, were still a bit in denial till the start of school year and only then left the area directly affected by war.
My point is simple — you take the ability to access banking system for granted, when it’s far from universal. It’s also not as unrestricted and interconnected as bitcoin or internet itself. Sometimes you have a bank and a card, but your ability to transact is restricted. It doesn’t always mean that you sit in the basement hiding from daily artillery strike or wandering post-nuclear desert on a cool bike.
I guess I was more pointing out that right now it seems highly scenario-specific whether or not cryptocurrency can help in the way you described.
Doesn't it depend on the amount of money you're dealing with, what you may or may not need to do with said money in the near-future, your own technical competence/facility, and perhaps even the current state of cryptocurrency itself?
You just need to be in a situation where the law prohibits, or somehow restricts or severely taxes, the money transfer itself, or the use of that money to procure something you need.
WikiLeaks may have amassed more than $46 million in Bitcoin based on the number of coins held by its known wallet address. https://bitcoinist.com/wikileaks-has-received-more-than-46-m...
Sometimes crypto is the only way of sending/receiving money from other countries reliably and cheaply.
Other countries are much worse, Venezuela for instance has destroyed the value of their money, so bad that people use it wallpaper.
I heard there was a similar problem in Egypt, no idea if and how it was solved.
It beggars belief that someone would so callously call the situation in these countries 'hypothetical'. Please, inform yourself about the war and strife that is occurring outside your own bubble. Its very important that we in the West stop ignoring the plight of the people our military industrial complex is targeting with their weapons.
Bitcoin has held things together in many such places.
Also: Russia.
User adamsea is informing himself, that's why he's asking a question here.
Just because people are starving behind economic blockades and sanctions and mafia hell, doesn't mean they don't RTFM.
(Oh, and you can use BTC on the street, all over the world.)
Bitcoin users are a tiny, tiny percentage of "anyone".
Shouldn't we amend that statement to be "You can use bitcoin to buy anything which is being sold by some other bitcoin user?" ;)
Which sure, is potentially anything/anyone, but will obviously vary on circumstances.
They: What is this?
Me: Money.
They: No, bring money.
https://en.wikipedia.org/wiki/2012%E2%80%932013_Cypriot_fina...
Bitcoin was the backstop that saved my ass when I went to SE Asia and none of my first-class Australian or US bank cards would let me get cash.
In the US perhaps. In at least one other country however...
https://www.bbc.com/news/business-47553048
https://www.somagnews.com/bitcoin-becomes-the-dominant-curre...
So in my view, it's pretty nice as an alternative to holding gold. Gold can be nice as well of course, but it's difficult to transport. If you keep gold in your home, at some point someone might break into your home and steal your gold. You could pay some company to store your gold, but perhaps in times of crises a government might step in and claim some of your gold.
Crypto currencies can be easily held in a digital wallet or people can even just memorise the keys to their wallet in their brain. It's hard for governments to control crypto currencies and I'm sure some of the wealthiest people in the world now keep a certain small percentage of their wealth in cryptos as well as a hedge against fiat currencies, stock market crashes, etc...
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[0]: https://news.bitcoin.com/venezuela-bitcoin-use-hyperinflatio...
[1]: https://www.financemagnates.com/cryptocurrency/the-impact-of...
Not really. If I want a bank account I need to fill out a page of paperwork requiring my name, address, social security number, citizenship information, income, occupation, date of birth, scans of various pieces of ID and/or other documents. Compare this to bitcoin where you only need to install an app, and new identities can be generated on-demand. It's true that trying to buy/sell bitcoins via an exchange will subject you to AML requirements, but in-person transactions won't.
>transactions take forever, they cost money [...] unlike my free credit card.
The cost and time it takes is mostly a function of how much demand is there for blockchain space. During periods of high transaction volume, you'll either have to pay high fees or wait a long time. You can see in this chart https://jochen-hoenicke.de/queue/#0,30d that there are periods of very high transaction fees (the yellow peaks correspond to a $3 fee for a typical transaction), but also periods with low transaction fees (the parts with blue troughs correspond to a $0.12 fee for a typical transaction). People in a hurry pay more and people who can wait pay less. It's a classic microeconomics.
Credit cards aren't free either. The cost (around 2-3% in the US) is borne by the merchant. Cash has fees for handling, transportation, and storage. "Free" bank transfers (eg. vemo, SEPA) are typically restricted to consumers, are often part of a bigger banking package, which have fees or minimum balance requirements.
Nobody does bitcoin transactions in person, at least not in America and not anyone I know. I have several bitcoins and the only way to use them is through an exchange like coinbase, who require the same identity documents that a bank does.
You could argue “but you just have to find vendors who accept bitcoin!” But with 3 bitcoin I won’t find enough vendors to spend it on.
>You could argue “but you just have to find vendors who accept bitcoin!” But with 3 bitcoin I won’t find enough vendors to spend it on.
There are also bitcoin-for-gift-card stores, which vastly expands your vendor options.
In EU, regulation caps interchange fees at 0.2% of the transaction value for debit cards and at 0.3% for credit cards.
> "Free" bank transfers (eg. vemo, SEPA) are typically restricted to consumers, are often part of a bigger banking package, which have fees or minimum balance requirement
A bank that i use has free SEPA transfers, no montly fees and negligible minimum balance reqirements, both for consumer and business accounts.
but I think you do. You find a seller who is willing to accept the currency you're using, and you use whatever interface to the bitcoin network you've chosen to do "send x money to y identifier". No different to a regular EFT.
You identified the exact problems. It's not that bitcoin transfers are some weird foreign concept, it's that they take forever, have high fees and aren't accepted universally.
The major users of bitcoin as an actual currency rather than a speculative vehicle are places that can't use the more convenient forms of currency. Guaranteed they'd rather use USD if they could.
Well that's a non-starter. If I wanted to buy a beer with bitcoin right now, I'd probably end up drinking tap water.
However if you wanted to purchase "illegal" drugs online you'd be hard pressed to find anyone who will accept your USD.
Same for Bitcoin, you install a wallet app and use it. It's actually much easier than opening a bank account.
> Meanwhile normal people without a serious networking/distributed systems background will not really grasp what they are doing
They won't grasp what they're doing on their bank account without a serious economic/financial/law background either.
I saw Bitcoin project on GitHub's artic code vault[1] and advertised heavily. But I couldn't find libbitorrent on it besides it being hosted on GitHub as well. Is this because the project owner hasn't enabled it or is there some other reason behind it?
That said, unfortunately, short of a large nation state, or collection of banks also allowing exchange/transactions, I don't think it will ever take off. Even then, transaction times as you mention are not fast, and often are controlled by a limited number of organizations.
What the technology does offer, is a means for multiple parties that don't trust each other to proceed with a transaction. This is often where "smart contracts" come into play, and also why banks are considering a cryptocurrency system(s) for inter-bank exchanges.
In the end, those that win will largely be the incumbents imho.
I setup bitcoin on a few machines really early on... and had a couple coins... but I had no way to "use" them and it was just costing electricity at the time... I deleted it all and didn't look back until they cleared $20k a coin. Kind of wish I at least saved a zip file of the wallets somewhere. Though if I'd kept mining, may have been worth something.
That doesn't make it useless for someone else, who might for example live in Argentina.
The day you want to hire someone who wants their payment in Bitcoin for some reason, that's when you'll have use for it.
You don't have to go anywhere, you don't have to provide any kind of ID or documentation, you don't have to wait around for a free salesperson.
> but transactions take forever
Bitcoin transactions are instantaneous. Look up "settlement cycle" if you want to make a direct comparison. Bitcoin final settlement usually takes about an hour, compared to anywhere from several days to several months for traditional payment. Credit card settlement is usually 60-90 days.
> they cost money
It costs less than a dollar to move ~any amount of money anywhere in the world with ~1hr settlement. A credit card usually costs something like $0.25 + 3%.
> the currency is not accepted by any business I use... I have 55€ in my wallet and everyone on this continent knows what to do with it.
I have AU$80 in my wallet and I'm pretty sure no one on your continent would take it.
In fact, last time I traveled to SE Asia none of my debit cards worked for cash withdrawal and the only way I was able to get cash was with a Bitcoin ATM. So it worked very well for me!
You can already purchase Reddit MOONS from the r/cryptocurrency subreddit here: http://xmoon.exchange/
So do stamps, coins, Star Wars figurines in original packaging, baseball cards, yada yada.
At least you can look at those other things while you possess them.
https://www.reuters.com/article/us-crypto-currencies-africa-...
Adoption will establish itself in Africa, S.America, Asia first.. and then it will compete head on with traditional western banking services.
There's great progress being made, but we'll not get there during 2020.
The largely obviates the need for any domain knowledge.
Who cares? Anyone who feels like their purchasing power isn't where it should be is either underpaid, or a victim of central banks diluting their dollars with printing.
So, nobody in the EU or North America, then.
In the US, stocks are 187.8% market cap to GDP.
But please, tell us more about how there's no inflation.
https://www.cbc.ca/news/business/cyprus-bank-account-tax-put...
(Also, the grandparent post perhaps should have given some context to the statement "Lightning made scaling possible", such as the fact that Bitcoin originally supported 32 MB blocks of transactions, before being "temporarily" limited to 1 MB. Alternative blockchains have managed without this artificial restriction, and without relying on complicated second-layer "solutions" like Lightning.)
European leaders wanted to limit the size of the rescue loans — which are backed by European taxpayers — to €10 billion. Leaders were also reluctant to bail out Russian depositors whose funds may be the result of tax evasion, crime or money laundering.
Additionally, there are sanctions in place since the 2014 Crimean crisis.
https://www.themoscowtimes.com/2019/01/10/cyprus-no-longer-m...
I can’t remember who aid it originally, but there’s a great test you can give to any statement or idea. Just immediately ask “who cares?” The best product demos I’ve ever seen answer who cares in each part of the pitch. The worst ones just rattle off mumbo jumbo forever.