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Moving money internationally

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Re: Moving money internationally

#211

Post by LittleNemoInS »

jaclaz wrote: post #210
LittleNemoInS wrote: post #205

Earlier quoted context omitted.

Yes. If I want to wire you some cash from bank A to bank B, my bank (A) will debit my account,and credit their account (called a nostro). There, we have two possibilities : * The two banks are connected (meaning B has an account in A), A will debit their nostro and credit the account of B in A (called a loro) and inform bank B via swift. B will debit the account of A in B, credit their nostro, debit their nostro and…

Should be nostro and vostro (our and your) not loro (their): https://en.wikipedia.org/wiki/Nostro_and_vostro_accounts the loro is used when a third bank is in the process or however is not as common as the two above.

You are right, sorry for the confusion. (However, the WP article is not really accurate, nostro accounts can also be our money in our system)

Re: Moving money internationally

#212

Post by jaclaz »

LittleNemoInS wrote: post #211
jaclaz wrote: post #210

Earlier quoted context omitted.

Should be nostro and vostro (our and your) not loro (their): https://en.wikipedia.org/wiki/Nostro_and_vostro_accounts the loro is used when a third bank is in the process or however is not as common as the two above.

You are right, sorry for the confusion. (However, the WP article is not really accurate, nostro accounts can also be our money in our system)

No need to be sorry, but yes, Wikipedia articles can be a bit "vague" sometimes, it was just the first reference I found, maybe this one on investopedia is better, though it is also seemingly putting an accent on foreign currency/foreign banks, which I don't believe is the only use (I mean the concept applies to banks in a same country as well, AFAICR):

https://www.investopedia.com/ask/answers/051815/what-differe...

Re: Moving money internationally

#213

Post by CryptoPunk »

lottin wrote: post #150
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…

> Ethereum is now estimated to consume energy equivalent to or greater than mid-sized countries like Greece[1]. While providing 1/700,000 of the computing power of a Raspberry Pi.

It's substituting for the state, and the social organization it provides, not personal computers.

Re: Moving money internationally

#214

Post by exdsq »

select-all wrote: post #186
exdsq wrote: post #184

Earlier quoted context omitted.

Can you use a stablecoin like USDC?

Yes, that's what we ended up with. It required a lot of hassle on the side of the sender because it wasn't clear what tax and liability risks this involves for a US company to send a crypto payment. But it worked and I really appreciate they were willing to help me. Not sure if a lot of companies are willing to go great lengths to get their Russian employees paid in this situation... Also, got bless crypto currencies…

I had a similar moment :) If you have a good on/off-ramp it's quicker, cheaper, and just as easy for international payments that go through different banking systems. I wish all the hype around speculative trading of NFTs and 'Web3' would die for a while so we can finish building the actually awesome parts like financial accessibility.

Re: Moving money internationally

#215

Post by Giorgi »

This post knows nothing about the subject it talks about.

Reads like "Russia stronk, Russia do not care" kind of propaganda, SWIFT is exclusively used for wire transfers and exclusion from it leaves companies to conduct their business via Cash-only, just look at the Iran, they only trade with cash when it comes to exports/imports.

Re: Moving money internationally

#216

Post by lottin »

CryptoPunk wrote: post #213
lottin wrote: post #150

Earlier quoted context omitted.

> Ethereum is now estimated to consume energy equivalent to or greater than mid-sized countries like Greece[1]. While providing 1/700,000 of the computing power of a Raspberry Pi.

It's substituting for the state, and the social organization it provides, not personal computers.

No offence, but it would probably be a good idea for you to study some theory of the state, before making such outlandish remarks.

Re: Moving money internationally

#217

Post by htrp »

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.)

swift is literally the TCP/IP of global finance

Re: Moving money internationally

#218

Post by [deleted] »

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.

[deleted]

Re: Moving money internationally

#219

Post by vba616 »

exdsq wrote: post #99
vba616 wrote: post #90

Earlier quoted context omitted.

This seems like the very essence of money transfer without using the Western banking system, and it's a system that's been around for probably over a thousand years: https://en.wikipedia.org/wiki/Hawala The US Treasury department has a comprehensive-looking guide: https://www.treasury.gov/resource-center/terrorist-illicit-f...

Hawala is literally the opposite of crypto because it’s entirely about trust and has the same issues of external pressure modern banking has to stop transactions that crypto doesn’t

I don't see how they are alternatives to each other, because crypto doesn't perform the same function. It's only marketed that way.

You can be sure a system like Hawala works because actual terrorists have used it forever. Like Toyota pickup trucks.

There are notorious pictures of Toyota pickups with frames that have broken in half. Since they have "issues" does it mean insurgents should drive Teslas instead?

Re: Moving money internationally

#220

Post by sumanthvepa »

jsmith99 wrote: post #165
sumanthvepa wrote: post #110

Earlier quoted context omitted.

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.

Eurodollar accounts are essentially deposit accounts at a non-US bank denominated in USD. They are, as are all deposit accounts, debt instruments issued by that bank.

These accounts, as you point out, are not subject to US regulations in the sense that US laws regarding bank deposits need not be complied with. A domestic USD checking account at Bank of America is regulated by the FDIC with insurance against fraud etc. For Eurodollar accounts these protections don't apply. (Other protections provided by their home-country laws might apply though.)

However, if you were to actually try to transact in USD with that account, the transaction path would still touch an institution that has an account with the Fed. And hence be controllable by the US government.

For example if you were to withdraw $50 in cash from your eurodollar account, the bank would still have to purchase the dollars (or more generally acquire them in some way) to give them to you. They cannot print the dollars themselves. The same thing applies to electronic transactions, except that now, there will be a corresponding set entires in the electronic ledgers of some US bank that has an account with the Fed.

So for the purposes of sanctions-busting, Eurodollar accounts are no good.

Eurodollar accounts are, of course, extremely useful for international trade. Most exporters will need a Eurodollar account to keep transaction costs low. Expats often hold a Eurodollar account with banks in their home countries to insulate them from exchange rate risk. There are a myriad other uses. But evading sanctions is not one of them.

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