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MasterCard to open up network to cryptocurrencies

reuters.com

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Re: MasterCard to open up network to cryptocurrencies

#191

Post by Consultant32452 »

PragmaticPulp wrote: post #66
Consultant32452 wrote: post #57

Earlier quoted context omitted.

It won't take long before Visa/MasterCard either adopt the Lightning network or create their own layer-2 service to alleviate transaction fees.

Why would they use any blockchain when they could get the same job done with a database and legal agreements, like they have been doing for decades?

If you send me bitcoin in exchange for a widget, I'm eventually going to want to spend that bitcoin and I may not be doing that on the Visa network. At some point they have to offload those transactions back to the blockchain so the coins can actually get to my wallet.

If they go the DB route as you suggest, they would basically be creating Visa Bucks, backed by bitcoin (which they'd have to buy), that can only be spent on the Visa network.

Re: MasterCard to open up network to cryptocurrencies

#192

Post by arcticbull »

BTCOG wrote: post #172
raiyu wrote: post #155

Earlier quoted context omitted.

Bitcoin is a modern day example of what happens when you have a currency that has deflation instead of inflation at it's core. It becomes actually more expensive to buy anything in the present, as a result, consumers stop purchasing, and as a result economic activity decreases. DigitalGold is also non-sensical, because that is simply designed to track against inflation, to prevent the loss of today's buying power tom…

@ArcticBull - Why would I ever want to make 100% ROI on a rigged stock market when I've made thousands of % in hard money?

see, with those glasses on it's not possible to have a real meaningful conversation. I'm sorry, bitcoin is in no way 'hard money'.

Re: MasterCard to open up network to cryptocurrencies

#193

Post by raiyu »

olalonde wrote: post #88
PragmaticPulp wrote: post #2

These stories usually spur more enthusiasm for buying cryptocurrency, but ironically those buyers aren’t interested in spending cryptocurrency using their MasterCard. They’re hoping other people will buy cryptocurrency from these announcements, driving the price up. Or, more likely, they’re just hoping other people will buy cryptocurrency and not use it in these spending systems. Spending cryptocurrency would result…

Bitcoin is used as a speculative investment today only because it is so underpriced. Once its value stabilizes, its use in day to day transactions will grow. > Should also note that MasterCard crypto transactions almost certainly won’t be settled on the blockchain. And neither are USD transactions. In fact, USD doesn't even have a blockchain! The great thing with Bitcoin is once you want to cash out your Bitcoin, you…

Bitcoin is used as a speculative instrument because by definition it is deflationary. Which means it is more expensive to buy something with it today, then tomorrow. Just look at Chamath's tweet about how he bought a property for Bitcoin in 2014 for $1.4MM but today that same amount of bitcoin would be $100MM+

https://markets.businessinsider.com/currencies/news/chamath-...

This creates an environment there is never a reason to use the currency for a purchase, strictly because it's supply is completely limited and never increasing over time.

Since the world economy continues to grow as GDP, output, and the population grows, it stands to reason that if Bitcoin in any way parallels our real world economic scenario, it would continue to rise in price per unit, because the overall GDP continues to increase.

As a result, it in fact never stabilizes, unless overall GDP stops growing.

Since it never stops growing, it never makes sense to use it for a purchase, and so you have a flywheel effect of ever increasing upward price pressure.

Re: MasterCard to open up network to cryptocurrencies

#194

Post by 3np »

PragmaticPulp wrote: post #2

These stories usually spur more enthusiasm for buying cryptocurrency, but ironically those buyers aren’t interested in spending cryptocurrency using their MasterCard. They’re hoping other people will buy cryptocurrency from these announcements, driving the price up. Or, more likely, they’re just hoping other people will buy cryptocurrency and not use it in these spending systems. Spending cryptocurrency would result…

I'm not so sure.

A move like this can increase the confidence that the Bitcoin price won't go down in the long-term - that is, someone do wants to spend their bitcoin in the future, and signals of greater market confidence increase the perceived likelihood of that.

The more I believe bitcoin is here to stay, the more comfortable I feel allocating savings in it.

This time is also a bit different; 2017 was almost entirely retail, this time it's a lot more businesses and institutions driving the BTC market.

Re: MasterCard to open up network to cryptocurrencies

#195

Post by centimeter »

systemvoltage wrote: post #84
PragmaticPulp wrote: post #2

These stories usually spur more enthusiasm for buying cryptocurrency, but ironically those buyers aren’t interested in spending cryptocurrency using their MasterCard. They’re hoping other people will buy cryptocurrency from these announcements, driving the price up. Or, more likely, they’re just hoping other people will buy cryptocurrency and not use it in these spending systems. Spending cryptocurrency would result…

What's the point of an unstable, volatile, frantically manipulated currency that is susceptible to social media pump and dump schemes (Elon + Doge)? Currency and its exchange rate needs to be relatively stable for the world to put trust into it. Saying that BTC is stable, but the rest of the world's fiat currency is fluctuating makes no sense. US dollar provides stability and security, I feel confident that a cappucc…

It’s reasonable to expect the value of Bitcoin to stabilize as it becomes a more popular store of value.

The US dollar provides stability and security over a very short timescale. It’s been inflating for decades (punishing dollar holders and waged/salaried workers) and based on the current political environment (insane dollar printing, “MMT” having political currency, etc.) there’s a substantial risk of serious dollar instability in the next few decades.

Re: MasterCard to open up network to cryptocurrencies

#196

Post by arcticbull »

danhak wrote: post #161
arcticbull wrote: post #153

Earlier quoted context omitted.

Right, yeah, if you pretend how much AAPL appreciated matters to anyone, asset inflation counts. Otherwise, it's CPI, and [citation needed] if you want to posit otherwise.

Housing, healthcare, education and childcare costs matter. I don’t believe CPI is accurately capturing the skyrocketing costs of these things, which are the most significant expenses for most households.

And yet you and everyone else are unable to produce any meaningful sources or analysis that justify your beliefs. [citation needed] and we can talk about it.

Healthcare is a social policy matter, not monetary policy, and nothing to do with increase in the money supply. You take that up with your representatives not the Fed.

Housing is a function of city council zoning policy. You take that up with your city council not the Fed, or with the federal government it you want Japanese style zoning rules. [1]

Childcare is social policy, not monetary policy, and you take that up with your representatives not the Fed.

You can't just point to anything you don't like and say the Fed Did It or is responsible for it. All they do is control the money supply. Nothing more.

A reduction in your welfare isn't inflation. Necessities can outpace inflation. It's bad social policy, but it happens. What you fail to understand is that these prices will continue to outstrip a platonic ideal even if denominated in Bitcoin because the increase in pricing has nothing to do with monetary policy. Any temporary reprieve is due to speculative mania.

[1] http://urbankchoze.blogspot.com/2014/04/japanese-zoning.html

Re: MasterCard to open up network to cryptocurrencies

#197

Post by centimeter »

PragmaticPulp wrote: post #169
scsilver wrote: post #89

Earlier quoted context omitted.

These currencies will inflate in value as their network grows wider. Each new user adds value like a telephone network. Eventually, there will be a point where everyone who wants to be connected is connected, they have bought the bitcoin they want and bitcoin prices reach an steady state. At that point, it should be stable enough to use as a currency.

It’s fascinating to watch MLM logic sweep the tech world. Get in on the ground floor of this opportunity, then convince all of your friends to buy in, then they convince all of their friends... Once the speculation upside is gone, why would anyone want to buy Bitcoin? That’s the real question.

MLM dynamics actually do apply to monetized assets in some cases. Cf. “Bubble Theory Of Money”, Gresham’s Law.

Once the speculation upside is gone, you would use Bitcoin because it’s the best available reserve and settlement asset. What are your other options? Inflationary USD or Yuan? Few rational actors would prefer to hold those.

Re: MasterCard to open up network to cryptocurrencies

#198

Post by cortesoft »

krisdol wrote: post #175
systemvoltage wrote: post #84

Earlier quoted context omitted.

What's the point of an unstable, volatile, frantically manipulated currency that is susceptible to social media pump and dump schemes (Elon + Doge)? Currency and its exchange rate needs to be relatively stable for the world to put trust into it. Saying that BTC is stable, but the rest of the world's fiat currency is fluctuating makes no sense. US dollar provides stability and security, I feel confident that a cappucc…

Full disclosure: I own about $11 worth of bitcoin if I round up a bit, so this might be biased. The most convincing "point" of bitcoin I've heard is to accomodate transfer of large sums of money across borders, quickly, with minimal transaction costs and oversight. Everyone here can afford the fee to transact 8 billion dollars worth of bitcoin. And settlement happens in seconds to a couple minutes. That's appealing t…

The price volatility is way more expensive than transaction cost, if you have billions of dollars.

Re: MasterCard to open up network to cryptocurrencies

#199

Post by warkdarrior »

lawn wrote: post #171
PragmaticPulp wrote: post #12

Earlier quoted context omitted.

Bitcoin transaction fees are currently around $8. My credit card pays me 2% to use it. No one wants to use the Bitcoin blockchain for average transactions. No one is buying Bitcoin as anything other than a speculative investment right now.

We shouldn't forget that there are other cryptos that don't have these ridiculous fees. Also, your credit card pays you 2% because they extract a larger fee from the merchant, who will raise prices to cover that expense. So you're not really saving money.

Will the merchants give me a 2+% discount and cover the BTC transaction fee if I pay in Bitcoin?

Re: MasterCard to open up network to cryptocurrencies

#200

Post by dragonwriter »

agumonkey wrote: post #184
maeln wrote: post #113

Earlier quoted context omitted.

And let's not forget that bitcoin can process on average less than 7 transactions per seconds. That's incredibly slow. It can be used for anything irl as long as this fundamental problem is not fixed. Nobody will spend 10+ minutes in front of the cashier waiting for the transaction to be confirmed. Most cryptocurrencies are plagued by the same issue. Everyone and their mother still come out with their own cryptocurre…

I have a feeling that traditional cc system are slower than the time user waits for confirmation. Isn't it buffer based like disk io ? the bank has a buffer to accept any card that is legit (for small transactions) and the rare time a problem occurs they deal with it on the side ?

> I have a feeling that traditional cc system are slower than the time user waits for confirmation.

Raising this in response to Bitcoin’s limited throughput is a nonsequitur, as this is latency, not throughout. Yes, the time between initiating and settling a credit card transaction is nontrivial, but that doesn't effect the number of transactions the system can process per second. If the credit card system didn't have the throughput to handle transactions at the rate they are initiated, there's be an ever-growing queue, and there isn't.

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