Cryptocurrency and the unbanked • Hacker News Board

Re: Cryptocurrency and the unbanked

#21

Post by lottin » Sun, Oct 03, 2021, 11:25 AM UTC

laurentdemarez wrote: post #8

pudo wrote: post #4

Towards the end, the author claims that the benefit of crypto will be to teach people financial literacy. Not only is that a little bit like teaching people responsible drinking by bringing them to the Oktoberfest, I'm also not sure all the people who do not have bank accounts are really going to use their late-model iPads to watch CryptoBroTube to learn about stablecoins and NFTs... Nominating this post for the "han…

I don't think this is what the author meant. I think the key here is that it's easier for people to obtain financial literacy because crypto is more accessible than the current financial system.

Which is a ridiculous claim, both because 1) crypto is not more accessible, and 2) being able to access more financial services doesn't make you less financially illiterate.

Re: Cryptocurrency and the unbanked

#22

Post by davidgerard » Sun, Oct 03, 2021, 11:25 AM UTC

This is ridiculous crypto pumping.

None of this works unless the world already runs on crypto. And not even El Salvador actually does that, because the populace hate the bitcoin system, the official payment network is completely unreliable, and the unofficial wallets don't have the fees subsidised.

The most common issue with "banking the unbanked" is a lack of sufficient documentation. This is not a problem in El Salvador, because they have a national ID card, and you can get a basic bank account with that.

And yet, only 30% in El Salvador have a bank account. What does crypto do about that? What need does crypto fill that the existing basic accounts are failing to?

I wrote a book chapter about this crypto marketing buzzphrase. It's been a common buzzphrase in bitcoin and other cryptos since 2013 - and zero of these people have ever given a joined-up account of how this is supposed to work in practice. Not even Facebook, when they put banking the unbanked as a key advantage of their proposed Libra cryptocurrency. https://davidgerard.co.uk/blockchain/2021/02/12/libra-shrugg...

"Banking the unbanked" is a complex problem, and crypto addresses none of the hard bits.

Re: Cryptocurrency and the unbanked

#23

Post by BrianOnHN » Sun, Oct 03, 2021, 11:29 AM UTC

masklinn wrote: post #10

EdwardDiego wrote: post #9

Earlier quoted context omitted.

Cryptocurrency really feels like a solution desperately in need of a problem.

> a solution desperately in need of a problem. Or a pyramid scheme in need of an excuse / justification.

Or a massively multiplayer online game of hot potato.

Re: Cryptocurrency and the unbanked

#24

Post by lottin » Sun, Oct 03, 2021, 11:32 AM UTC

chii wrote: post #13

EdwardDiego wrote: post #9

Earlier quoted context omitted.

Cryptocurrency really feels like a solution desperately in need of a problem.

Crypto is a solution to the "problem" of centrally controlled money. I'm just not 100% sure that it is a real problem, but those who buy it either believe it to be, or at least, want to hedge for it.

Isn't bitcoin centrally controlled though? Bitcoin's monetary policy is programmed into the bitcoin software. This means whoever writes (or wrote) the software controls the policy.

Re: Cryptocurrency and the unbanked

#25

Post by n0mad01 » Sun, Oct 03, 2021, 11:32 AM UTC

zinekeller wrote: post #2

Eh, probably, but so can mobile banking solutions[1] that are popular in Africa. Unlike in, for example, Europe where mobile payments requires a (relatively fancy) phone, M-Pesa works even on basic phones, which you can't say about cryptocurrencies in general. This is not to dismiss them, of course, but "conventional" currency already has a solution for this, so unless you're advocating for decentralisation (which is…

Then how come that 57% of Africa's population lacking any form of bank account.

Re: Cryptocurrency and the unbanked

#26

Post by Ronziee7251 » Sun, Oct 03, 2021, 11:33 AM UTC

There's probably technologies that are easier to use to solve the unbanked problem.

What I find interesting about the article is that it seems to acknowledge this problem. It's doesn't seem like a "crypto is the solution" article.

Crypto is inclusive in the sense that anyone can participate, but exclusive in the sense that the knowledge barrier is really high.

Does anyone know about any kind of project that teaches young people about financial literacy?

Re: Cryptocurrency and the unbanked

#27

Post by davidgerard » Sun, Oct 03, 2021, 11:35 AM UTC

lottin wrote: post #24

chii wrote: post #13

Earlier quoted context omitted.

Crypto is a solution to the "problem" of centrally controlled money. I'm just not 100% sure that it is a real problem, but those who buy it either believe it to be, or at least, want to hedge for it.

Isn't bitcoin centrally controlled though? Bitcoin's monetary policy is programmed into the bitcoin software. This means whoever writes (or wrote) the software controls the policy.

Bitcoin mining has also been centralised since about 2014 - three entities are known to control >50% of all mining, and there's no way of knowing how many of the other mining entities they have effective control over.

"Decentralised" is a phantasm.

Re: Cryptocurrency and the unbanked

#28

Post by shadowprofile76 » Sun, Oct 03, 2021, 11:38 AM UTC

masklinn wrote: post #10

EdwardDiego wrote: post #9

Earlier quoted context omitted.

Cryptocurrency really feels like a solution desperately in need of a problem.

> a solution desperately in need of a problem. Or a pyramid scheme in need of an excuse / justification.

Please do define how Bitcoin or Ethereum (among others) are "pyramid schemes". Cryptocurrencies have indeed been used for pyramid schemes by specific actors, but then again so has normal money, and many other things. Numerous people on this site who presumably have the intellectual faculties to know better toss that little qualification out from their mouths almost reflexively out of emotional crypto-hate, but have apparently never even read a basic encyclopedia definition of pyramid scheme structure.

Re: Cryptocurrency and the unbanked

#29

Post by louwrentius » Sun, Oct 03, 2021, 11:39 AM UTC

n0mad01 wrote: post #25

zinekeller wrote: post #2

Eh, probably, but so can mobile banking solutions[1] that are popular in Africa. Unlike in, for example, Europe where mobile payments requires a (relatively fancy) phone, M-Pesa works even on basic phones, which you can't say about cryptocurrencies in general. This is not to dismiss them, of course, but "conventional" currency already has a solution for this, so unless you're advocating for decentralisation (which is…

Then how come that 57% of Africa's population lacking any form of bank account.

Because of non-technical reasons: like economical and political reasons.

Cryptocoins won't solve those issues, nor can they bypass them.

Re: Cryptocurrency and the unbanked

#30

Post by louwrentius » Sun, Oct 03, 2021, 11:40 AM UTC

Ronziee7251 wrote: post #26

There's probably technologies that are easier to use to solve the unbanked problem. What I find interesting about the article is that it seems to acknowledge this problem. It's doesn't seem like a "crypto is the solution" article. Crypto is inclusive in the sense that anyone can participate, but exclusive in the sense that the knowledge barrier is really high. Does anyone know about any kind of project that teaches y…

The 'unbanked' problem isn't a technical issue in the first place.