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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

#901

Post by BenoitEssiambre »

jkepler wrote: post #890
BenoitEssiambre wrote: post #440

Earlier quoted context omitted.

The pre ww1 world was probably too different from today to draw lessons applicable today and in any case there were recessions every few years back then: https://en.wikipedia.org/wiki/List_of_recessions_in_the_Unit... Gold tied assets hoarding caused the great depression.

Thanks for your response. Perhaps the pre-WW1 period is too different from today because we're still living in the 100-year+ experiment if central banks and applied Keynesian theory. If the Austrian school's business cycle theories are correct, recessions are longer and more painful under central banks' manipulated monetary markets because malinvestments are rarely cleared from the economy: those enterprises get bail…

"The gold standard was the primary transmission mechanism of the Great Depression..." https://en.wikipedia.org/wiki/Great_Depression#The_gold_stan...

I mean, it wasn't strictly gold hoarding it was gold tied currencies hoarding.

Re: MasterCard to open up network to cryptocurrencies

#902

Post by akra »

Mc_Big_G wrote: post #50
liquidify wrote: post #27

Earlier quoted context omitted.

They couldn't do that. If they didn't actually have any crypto, in the event of a large scale increase in price combined with a large scale cash out, Paypal would have to eat the difference from buy to sell price. They would lose their shirt. At minimum, Paypal is buying some percentage of the crypto sales in actual crypto to act as a hedge. However, it is more likely they are closer to 1 to 1 backing since they prob…

You're giving Paypal and Robinhood too much credit. It wouldn't surprise anyone if they both consider themselves "too big to fail" and do not have sufficient crypto to cover themselves. It's easy to imagine the meetings where someone "important" says "That will never happen, end of discussion." and then it turns out they they're wrong and they get bailed out (or not).

"Too big to fail" - and that's how you increase the supply of BTC without actually doing so I think.

As long as an entity (such as the government) prints money and takes the hit on the spread people will see contracts of BTC as equivalent as BTC w.r.t value. Its basically banking, but since fiat is still the prime currency of legal settlement (not BTC) no one will think its possible to "run the bank" as that entity in the event of a run will pay the difference. BTC is not actually required to settle anything by most countries laws, so actually delivery of BTC isn't guaranteed. This does undermine actual BTC especially if actual BTC is harder to spend - the pseduo-BTC would then have more utility.

In other words BTC could be the same as fiat potentially in the longer term. It will be more transparent of course since it it easier to take delivery of than say gold (or cash but less so), but as long as they don't give you that option in your product that's fine. Even cash is like this with withdrawal limits, and other laws. If fiat was only valued by the actual cash in the economy it would be worth a lot more than it is now btw.

Re: MasterCard to open up network to cryptocurrencies

#903

Post by austhrow743 »

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…

Doing social media pump and dump schemes is fun and sometimes profitable.

Re: MasterCard to open up network to cryptocurrencies

#904

Post by simiones »

CryptoPunk wrote: post #895
simiones wrote: post #884

Earlier quoted context omitted.

Yes, in a functioning economy. Here we are discussing what happens as an economy breaks down - as people stop being able to pay their debts, for various reasons.

I thought you were talking about economies with poorly functioning states, like say Ethiopia or Kenya. In these places, markets work quite well, they are just limited in the range of products and services they offer. They have limited access to the most useful financial and payment systems, like PayPal, due to undeveloped banking systems, blacklisting by governments of advanced economies, and bans by their own goverm…

Usually, markets work quite well because they work face to face. Internet commerce on the other hand is usually extremely risky business if you don't have access to parties which can control that risk: strong, fair states that enforce complex laws in cases of disputes; 3rd parties that assume some of the risk, such as PayPal or eBay.

Bitcoin solves none of these problems. Sure, it allows you to at least assume this risk, which your country otherwise doesn't, so it's not nothing. But it's at best a band-aid.

It also doesn't protect you in any way from your employer not paying your salary on time, from being wrongfully terminated, from not being able to get a loan, from business partners not paying their debts because they can't sell their own products etc. These are usually the problems that a non-functioning state and non-functioning economy face.

Re: MasterCard to open up network to cryptocurrencies

#905

Post by ric2b »

PragmaticPulp wrote: post #695
ric2b wrote: post #503

Earlier quoted context omitted.

Nothing stops you from having Bitcoin credit cards. In fact they already exist. Dollar bills don't have any of the advantages you mentioned either. How fast and secure do you think mailing them to some company is? A lot of these arguments are really just cherry-picking whichever portion of the financial system best suits your argument at the time and pretending they're only possible if they're built on top of pieces…

> Dollar bills don't have any of the advantages you mentioned either. How fast and secure do you think mailing them to some company is? No one mails paper dollar bills around. Bitcoin always sounds fantastic when compared to these straw-man alternate universes where everyone is mailing dollar bills around, but let's stick to reality where no one does that. > pretending they're only possible if they're built on top of…

> No one mails paper dollar bills around.

Right, and that somehow didn't stop USD credit cards from existing.

But for BTC it's either the base chain is better for every single use case or it's a giant waste of time.

> USD isn't literally built on top of paper money.

Right, there's also virtual USD and then there's all the USD above M1 that doesn't even exist as physical dollars or Fed reserves but is just willed into existence via debt.

> Cryptocurrency, however, is literally invented out of thin air by programmers.

As opposed to being invented out of thin air by bankers. At least BTC is publicly auditable and verifiable.

> New cryptocurrencies are released every week. Even Bitcoin gets forked at times.

So what? You can start making PragmaticPulpDollars, how is that a problem for USD?

Re: MasterCard to open up network to cryptocurrencies

#906

Post by CryptoPunk »

simiones wrote: post #904
CryptoPunk wrote: post #895

Earlier quoted context omitted.

I thought you were talking about economies with poorly functioning states, like say Ethiopia or Kenya. In these places, markets work quite well, they are just limited in the range of products and services they offer. They have limited access to the most useful financial and payment systems, like PayPal, due to undeveloped banking systems, blacklisting by governments of advanced economies, and bans by their own goverm…

Usually, markets work quite well because they work face to face. Internet commerce on the other hand is usually extremely risky business if you don't have access to parties which can control that risk: strong, fair states that enforce complex laws in cases of disputes; 3rd parties that assume some of the risk, such as PayPal or eBay. Bitcoin solves none of these problems. Sure, it allows you to at least assume this r…

>>Internet commerce on the other hand is usually extremely risky business if you don't have access to parties which can control that risk: strong, fair states that enforce complex laws in cases of disputes; 3rd parties that assume some of the risk, such as PayPal or eBay.

Cryptocurrencies can be used in person too.

With respect to eCommerce, EBay worked extremely well simply because of reviews. Not because of laws. And yes, people came to trust eBay, which was due to its faithful fulfilment of its obligations as a platform steward, not due to regulatory requirements imposed on it.

Re: MasterCard to open up network to cryptocurrencies

#907

Post by elyobo »

recursive wrote: post #730
b112 wrote: post #557

Earlier quoted context omitted.

There are loads of cases of hyper-inflation, which means that the currency's real-world value decreases. Here's the worst I've ever heard of: https://en.wikipedia.org/wiki/Hyperinflation_in_Zimbabwe Yes, you read that right: "However, Zimbabwe's peak month of inflation is estimated at 79.6 billion percent month-on-month, 89.7 sextillion percent year-on-year in mid-November 2008." I recall interviews with government e…

For mere hyper-inflation, it seems there's a cap of 100% value loss. It's something else together to lose more value than there was in the first place.

Yeah, that's what I'm not getting here. If you had infinite inflation you'd only lose 100%.

Re: MasterCard to open up network to cryptocurrencies

#908

Post by eek04_ »

nathias wrote: post #877
eek04_ wrote: post #834

Earlier quoted context omitted.

I don't believe it will be a benefit. Current monetary policy is to keep inflation positive and low, while addressing economic shocks that make money velocity low by increasing the supply. A low positive inflation effectively makes all prices that are denominated in a fixed amount of the currency slowly lower. This helps the economy - ie, people and companies acting in the economy - deal with changes more easily, sin…

> A low positive inflation effectively makes all prices that are denominated in a fixed amount of the currency slowly lower. This helps the economy - ie, people and companies acting in the economy This helps the people who have capital and is paid for by the people who only have wages. I am a person that only has a wage, so I choose bitcoin.

It helps ~everybody by making everything adapt. People that just earn wages too.

Re: MasterCard to open up network to cryptocurrencies

#909

Post by reedjosh »

ajmurmann wrote: post #894
reedjosh wrote: post #629

Earlier quoted context omitted.

TBH, I'm ignorant of these countries' regulatory systems. You may be right. What makes them good examples?

This podcast will do a much better job at explaining how solid economic policy lead success in Hong Kong: http://www.econtalk.org/neil-monnery-on-hong-kong-and-the-ar... Of course Hong Kong is now different, but that's not because the government changed its policies, but there is a different government in power. Singapore had the benefit of a trade port, but it kept importance as such and expanded into becoming a imp…

I will review. Russ Roberts is pretty good. He leans closer to no governance than any.

Still, Hong Kong being different now is because the powerful (China) changed the government to favor themselves. This is actually an example of government falling to powerful interests in short order.

Singapore has as bad or worse of income inequality as the US, and I wouldn't say the US is well governed. https://en.wikipedia.org/wiki/List_of_countries_by_income_eq...

Still, I don't want to take equality as a primary metric since I think inequality to some degree is natural.

Singapore is however a infamously repressive regime as mentioned by ardy42

Re: MasterCard to open up network to cryptocurrencies

#910

Post by _jjkk »

RhodoGSA wrote: post #900
_jjkk wrote: post #880

Earlier quoted context omitted.

The point is, a government can make it illegal to sell goods for crypto. As well as making it illegal to transact crypto anonymously. So unless you find some black market for all your material goods, you will be FORCED to "exit" some of your crypto into fiat at some point. It is at this point that the design of BTC in particular makes it impossible to hide this "exit", because a government can easily surveil the bloc…

Again, I don't think you understand crypto very well. I can buy coins on a DEX and transfer them to my hard wallet. There's no 'Verifying' or 'Knowing my address'. Again, your government banning selling goods for crypto makes it a better investment opportunity for the world.

I'm not sure what you mean about "understanding" crypto, the concepts here are dead simple, there's not much to misunderstand.

In this scenario it doesn't matter that you can transfer some coins from a DEX to your "hard wallet". If you haven't registered your hard wallet's address with the government and linked it to your identity, you will be unable to use those coins for anything other than trading with other unverified wallets.

If you want to exchange the coins in your hard wallet for any valuable or material good whatsoever, without disclosing your actual identity to the government, you'd have to find someone willing to do so illegally i.e. a black market.

And the receiver of your "dirty" bitcoin, which is verifiably dirty because the transaction came from your (unverified) wallet, would then have to solve the same problem of laundering the BTC if he wanted to use it to pay for his costs / employees / etc.

And if we're talking about a large economic power, I'm not sure how banning crypto and making its transactions more difficult would help anyone; if anything it would negatively impact that crypto since it is less usable as a medium of exchange.

It may seem outlandish that a government would even go to these lengths, but I'd argue that wielding a centralized currency is too powerful for governments to give it up without a fight.

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