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Moving money internationally

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Re: Moving money internationally

#161

Post by Nursie »

CryptoPunk wrote: post #140
Nursie wrote: post #69

Earlier quoted context omitted.

Ethereum is now estimated to consume energy equivalent to or greater than mid-sized countries like Greece[1]. You can paint it as tiny, but 0.1% of world energy output is still enormous, for providing what is for the most part a highly speculative set of financial instruments to a limited audience. It's been "about to go PoS" for several years now. The fact is it hasn't. When it does, you can tell people their concer…

0.1% is huge, but in no reasonable terms can it be called "planet destroying", when it's slated to be mostly eliminated within 6 months with the transition to Proof of Stake. The characterization is hyperbole. As for the transition to PoS, the first phase of the transition was implemented on December 1st, 2020, with the launch of the Proof of Stake Beacon Chain. The Beacon Chain has been running without problems for…

> when it's slated to be mostly eliminated within 6 months

Ethereum, maybe, it's been six months away for years. BTC, nope.

Re: Moving money internationally

#162

Post by Nursie »

CryptoPunk wrote: post #153
pinephoneguy wrote: post #138

Earlier quoted context omitted.

Don't forget that traditional banks consume lots of energy as well. Their armies of employees and tellers are required to drive an hour or so every day, they maintain tons of physical buildings, truck around piles of physical currency etc. Traditional fiat is given legitimacy based on government's monopoly on violence inside their borders which often result in wars. Nothing is free and I'm fairly certain that crypto…

Exactly. Proof of work is costly in energy and affordable in labor. The energy consumption of labor-intensive industries obfuscates the real energy requirements of those industries, by effectively outsourcing the energy consumption to the workers. I still prefer Ethereum's variation of Proof of Stake over Proof of Work, but it's by no means clear to me that Proof of Work based blockchains are less resource-efficient…

Proof of work does not replace labour though. There is not really an equivalent outlay in tradtional banking. And blockchains don't provide the services that the labor provides in the banking sector.

This is just more nonsense.

Re: Moving money internationally

#163

Post by LittleNemoInS »

AnonHP wrote: post #92

This is one of those posts where I found very little substance compared to its length. And I didn’t really come out of it with a better understanding of moving money either (as to how correspondent banks ultimately settle the debts, which in turn becomes how countries settle their debts, etc.). I would’ve appreciated more nuance and information on that, even though it’s a vast topic. To simplify heavily, is SWIFT jus…

> To simplify heavily, is SWIFT just an accepted and legal alternative to the hawala system?

No. To simplify heavily, Swift is the network on which the hawala system runs.

To transfer cash from a bank to another bank, one can : * call the other bank * send an email * send a letter * send a swift message

Since transfering cash is not as simple as it seems (trust is the key), using an established network with clear fields and backups is a good choice. Thus Swift.

Re: Moving money internationally

#164

Post by select-all »

hamstergene wrote: post #155

I've just had to install several different VPNs until I've found one that offers a Russian endpoint, in order to get account statements from Russian banks. Which I need to comply with IRS regulation to disclose my foreign accounts as a part of U.S. yearly tax report. Not all banks are affected, only the most popular ones, it seems (e.g. VTB, Open). All of them, including the "unavailable" ones, still have USD and EUR…

Unfortunately (for me), "USD and EUR transfer options open to use" does not equal "you can send or receive USD or EUR to your account in a Russian bank".

In the past week I myself and many people I know were not able to receive a USD wire from US to their accounts in different Russian banks, none of which are even in the list of sanctioned entities (Tinkoff and Avangard banks are the most common example). In all these cases the transfer was declined by a US bank, probably due to compliance considerations. Sending USD or EUR outside doesn't work either, and in some cases you cannot even exchange the remaining USD on your account to RUB. The options are indeed available in the bank's web or mobile application, but clicking 'Send' just gives you a 'something went wrong' error and that's it.

It is true that Putin might be not noticing any inconvenience, just as most employees of state-owned companies (who happen to be the core Putin supporters), but people who rely on international payments for living (who happen to be the least loyal to Putin part of the population) are being severely hit by the sanctions and have spent the last week in the state of permanent panic trying to figure out what are the remaining options they have and how they'll pay their expenses in a month from now.

Re: Moving money internationally

#165

Post by jsmith99 »

sumanthvepa wrote: post #110
asmithmd1 wrote: post #81

Earlier quoted context omitted.

Why does settling in dollars make any difference? Like he said, if the SWIFT secure messaging service goes down, someone at a bank in Japan has the phone number of someone at a bank in New York and can "wire" money with a phone call instead of sending a SWIFT message. Wires will be orders of magnitude slower, but money is not frozen. And the real effect is that someone in Mumbai receiving a phone call from a Russian…

Because every single transaction in USD must result in a credit and debit to an account at the US Federal Reserve (except for transactions entirely in paper money -- this is the reason drug dealers like paper money.) For a transaction denominated Yuan(Renminbi) that transaction must eventually result in a debit and credit entry at the People's Bank of China (the central bank of China). In the latter case no US entity…

> Because every single transaction in USD must result in a credit and debit to an account at the US Federal Reserve

Are you sure about that? How about USD accounts outside America, commonly known as Eurodollars? Ultimately those dollars originally came from the Fed but they are effectively outside their control.

Re: Moving money internationally

#166

Post by fmajid »

patio11 wrote: post #97
AnonHP wrote: post #92

This is one of those posts where I found very little substance compared to its length. And I didn’t really come out of it with a better understanding of moving money either (as to how correspondent banks ultimately settle the debts, which in turn becomes how countries settle their debts, etc.). I would’ve appreciated more nuance and information on that, even though it’s a vast topic. To simplify heavily, is SWIFT jus…

Merchant banking was indeed quite similar to hawala, and came out of very similar needs. Correspondent banking is an outgrowth of merchant banking, and essentially allows trust chains to expand. SWIFT is a messaging system which those trust chains use to communicate. (Simplified because on phone, etc.)

The messaging system is orthogonal to the trust relationship between banks in different countries. In the old days, this trust came from family bonds, e.g. the various arms of the Fuggers or the Rothschilds. Nowadays, it's... more complicated. The US government spent billions on making foreign banks like BNP Paribas whole on contracts they had with AIG because it could not bail Goldman Sachs without also bailing them out, at least not without destroying the basis of trust in the international financial system. That's the part where compliance, risk management and AML-KYC intervenes, along with government employees installed directly inside the key banks to monitor it.

Re: Moving money internationally

#167

Post by Tenoke »

lottin wrote: post #151
k__ wrote: post #147

Earlier quoted context omitted.

I donated hundreds of dollars worth of Ether to Ukraine and paid like $2 worth in gas fees. That's less than 1%. Transferwise takes much more %.

You're conveniently forgetting the fees and other transaction costs associated with purchasing the Ether and then selling it for fiat.

The fees for buying and selling it are on the order of 0.075-0.5% with most exchanges.

Re: Moving money internationally

#168

Post by fmajid »

__d wrote: post #127
larrysalibra wrote: post #80

> “Sorry, you have citizenship from the High Risk Country list, accordingly I’m not allowed to open this account for you. This is a commercial decision of the bank and will not be reversed.” This sounds like what I heard from a lot of non-US financial companies when I used to be American and then didn't want to open accounts. Frustrating but predictable and probably intended outcome from regulator behavior.

FATCA made life difficult for non-US banks supporting US-citizen customers. Many won't open new accounts, some forcibly closed existing accounts.

You are effectively limited to the few large banks that can handle the red tape. It wasn't designed to make US persons' life abroad miserable, even if it did succeed handily to the point some US citizens are opting to renounce their citizenship rather than keep enduring the pain. The intent was to make the IRS' compliance processes easier. The level of detail in the FinCEN reporting Americans with financial assets abroad has also dramatically risen in the last 20 years. It used to be you just sent a list of banks along with whether your assets there exceed $10,000 or not, now you have to send a detailed summary with a max account balance (adjusted for exchange rate).

Re: Moving money internationally

#169

Post by justsomeuser »

Assuming the amount of a given currency does not decrease or leave its country, does this mean that when you “send money internationally” it is just switching owners in the same country?

So the money does not leave, new owners come into the country and control its flow?

Re: Moving money internationally

#170

Post by blitzar »

2143 wrote: post #159
adtac wrote: post #72

I looked a bit into the company SWIFT and found this: https://www.swift.com/swift-resource/250836/download (warning: downloads the file) Page 3 is interesting (ignore the rest, they're mostly buzzwords). It shows you the numbers behind the financial infrastructure of the world for international transactions. >FIN availability: 99.996% >Institutions connected: 11k >FIN messages: 9.5b That's about ~300 messages/sec, al…

> although I imagine it's mostly bursty and peaks during US/EU common business hours Because people in places like Japan, China, Australia, New Zealand, India, Singapore, Hong Kong, UAE, South Korea, and many others are hibernating.

> Because people in places like Japan, China, Australia, New Zealand, India, Singapore, Hong Kong, UAE, South Korea, and many others are hibernating.

Nahhh they are all just subsistence living workers and farmers bartering over rocks and other money like objects, unlike us sophistocated folk quaffing Châteauneuf-du-Pape with a side of caviar while we wait for the casino to settle the million dollar wire transfer of our baccarat winnings for the night.

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