Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Cryptocurrency doesn’t address the hard parts of financial inclusion

wave.com

Post reply on HN
Print view View original

61–70 of 227 posts

Re: Cryptocurrency doesn’t address the hard parts of financial inclusion

#61

Post by smoe »

rattlesnakedave wrote: post #45
smoe wrote: post #15

Earlier quoted context omitted.

Things is, companies like this solve a real world problem for real people in developing countries now . At least where I am, Colombia, crypto has utterly failed to do this. The target audience of such products doesn't care much about some hypothetical ifs and whens of the future.

Seems a bit early to say it has “utterly failed.” Especially when Colombia is consistently the 2nd most active trading country in LatAm. And As Banco De Bogota is piloting crypto programs https://www.portafolio.co/economia/finanzas/banco-de-bogota-...

Not saying crypto has failed in all aspects, just in the use case talked about in the blog post. I don't see crypto competing with e.g. Nequi any time soon.

The project you mentioned is interesting, but I see it as something much more for the middle and upper classes. I know plenty of crypto enthusiast in those circles.

I tried Buda, which is mentioned in the article as partner. It has been the most tedious experience with a "financial" product I had in my whole life.

Re: Cryptocurrency doesn’t address the hard parts of financial inclusion

#62

Post by pcthrowaway »

mkdirp wrote: post #31

Cryptocurrencies have never claimed they address the hardest parts of financial inclusion. Cryptocurrencies solve the issue of trust. > We need to keep track of our customers’ account balances. Right. That's what the blockchain is able to do. It can assert that you, who says you have 1 bitcoin in your wallet, actually really have 1 bitcoin in your wallet (assuming no attack vectors such as 51% attack). > We need them…

> There it is. This is just an article blindly bashing cryptocurrencies. I implore you to ask yourself, what has previously been used to do all the above? That's right. Fiat currencies such as the GBP, USD, and other currencies.

Did you read the part after that? It sounds like they might use crypto for other purposes, and that they hope the useful things about it come to overshadow the way it's largely used today.

Re: Cryptocurrency doesn’t address the hard parts of financial inclusion

#63

Post by dv_dt »

agacera wrote: post #10

Dan Luu impact at Wave.com is noticable already. Since he joined in March, Wave is pushing one great blog post per week (in contrast to 1 in 2021, 0 in 2020 and 3 in 2019). I tried creating this culture of blogging but failed, would love to hear strategies that worked to achieve this.

Be a good writer to be able to recognize and hire good writers?

Re: Cryptocurrency doesn’t address the hard parts of financial inclusion

#64

Post by el-salvador »

anonporridge wrote: post #13
k__ wrote: post #7

Onboarding is really a PITA. Until you found a way to pay for everything in crypto, you have to deal with centralized exchanges to get fiat to pay your stuff. Playing in fiat requires you to convert from a crypto token and that is a taxable event. It's a bit like shooting stuff into space. Getting out of earth's gravity is the hardest part, even if it's just a small fraction of the way.

It's a chicken and egg problem. You need to create a circular economy where people pay and get paid in cryptocurrency, like you have within a nation state with their home currency. The creation of that circular economy without a monopoly on violence that forces everyone to converge on a single one is something that will happen in fits and starts. And of course, you still need policy change to treat the cryptocurrency…

I've tested the lightning in El Salvador to lightning payments and they work in 4/5 seconds in the merchants that accept them. There's also the local wallet QR codes which I haven't had the opportunity to try yet

The volatility is what I like the least. Like one day realizing that the Wendy's hamburger I had for dinner was well timed, because a few hours later Bitcoin's value dropped.

In El Salvador we've had an stable currency for decades, the USD since 2001 and a stable Colón since the 1990s.

Exchange rates is something that most millennial and gen z's have never had to worry about in El Salvador. As our wages, many of our imports and exports are prices in USD.

Compare this to other countries like Argentina, Venezuela, Turkey or Lebanon where the exchange rate is daily news. Or like Nicaragua and Costa Rica where prices and payments can be made in both USD and their local unpegged currencies.

There are only a few currencies whose value ocassionaly increase compared to the dollar. Sometimes it's the Swiss Frank, the Guatemalan Quetzal or Euro. From this ones, the Quetzal exchange rate is perhaps the only one that could affect El Salvador the most as fruits and vegetables are sometimes priced/paid by importers in Guatemalan Quetzales.

Re: Cryptocurrency doesn’t address the hard parts of financial inclusion

#65

Post by bb88 »

jfk13 wrote: post #59
mkdirp wrote: post #48

Earlier quoted context omitted.

Right, I never said you can trust exchanges. You do not have to use an exchange. That's the whole point of the decentralised nature of cryptocurrencies.

The idea that ordinary people will (reliably, securely, safely) manage their own cryptocurrency holdings without using an exchange (or similar service) is ludicrous. This is blind techno-utopianism at its worst, and does nothing for humanity or society.

Further you need to trust the devs writing the algorithms as well.

BTC forked shifting much of the value of BTC onto another blockchain. If it happens again, you have to remain vigilant to recoup your value.

Re: Cryptocurrency doesn’t address the hard parts of financial inclusion

#66

Post by _vvhw »

kleinsch wrote: post #55
_vvhw wrote: post #8

"We need to keep track of our customers’ account balances. We need them to trust that their Wave balance is correct and Wave won’t lose the money." "At Wave, though, we prefer to use boring technology, and a simple relational database like Postgres does an equally good job at this." How does Wave ensure multi-region durability for Postgres, high availability, and strict serializability during failover, without risk o…

You seem to be vastly overthinking this. People have been building applications (including banking applications) using boring old relational databases for decades without losing data. Single master, replicated to another region. If relational databases were as faulty as you describe, every web app you use would be losing data all the time. Not everything has to be an overthought system design interview question.

Single DB corruption and disk failures are more common than you think.

"Single master, replicated to another region."

Why do you recommend against using a modern distributed database?

Is it that hard to spin up something like CockroachDB? In fact, it wouldn't surprise me that Wave are running CockroachDB as their Postgres foundation under the hood.

Re: Cryptocurrency doesn’t address the hard parts of financial inclusion

#67

Post by anonporridge »

JumpCrisscross wrote: post #51
anonporridge wrote: post #26

Earlier quoted context omitted.

I think this is a problem until it isn't. The first country that starts pricing its oil exports in bitcoin will a) cause the price to initially skyrocket, and b) create a stabilizing force on the price that percolates to all other goods and services. And the interesting thing, is that because bitcoin is energy money, there is a very direct and explicit correlation to the amount of bitcoin you can earn from using your…

> because bitcoin is energy money This is mostly nonsense. Energy provides a consistent price floor for mining Bitcoin. That has little relevance to its traded price. If energy prices triple, that doesn't mean Bitcoin prices have to triple as well. It just makes mining at lower prices unprofitable. If nobody wants to buy Bitcoins at the breakeven price, mining just stops--it doesn't magic demand into existence.

Mining energy use and the price of bitcoin are co-integrated. They play off each other. An increase in price incentivizes more mining and more mining increases the security of the system, which incentivizes more money to flow into and stay in bitcoin. Also, as miners become a larger industrial complex and tightly coupled to electricity producers, they become a tightly integrated piece of civilization that has funds local tax revenues, is the most ideal customer for electricity producers, gives people income, and has its own lobbying groups that push for positive policy change for the system.

And in the future flipped world I'm talking about, where in order to buy energy you need to have bitcoin, there is no "buying" bitcoin. Bitcoin is the primary money that you need to have to buy energy. And if you don't have it, then energy producers use their energy to mine it.

At that point, it ceases to be a speculative asset and becomes the key unit of account for civilization that doesn't depend on the enforcement of the monopoly on violence.

Re: Cryptocurrency doesn’t address the hard parts of financial inclusion

#68

Post by [deleted] »

ilammy wrote: post #46
Retric wrote: post #37

Earlier quoted context omitted.

Trust is the biggest issue with cryptocurrency. I can trust my bank + the government to keep my money safe. As has been repeatedly demonstrated, I can’t trust an exchange and keeping your own wallet is extremely risky.

> I can trust my bank + the government to keep my money safe. Trust them to keep your money – yes, you can absolutely rely on that. Trust them to have “your” money back – that’s a taller order. But it it will be safe, sure. At least with cryptocurrency you don’t have to keep it at an exchange, while the governments are pushing for abolishing cash and keeping all the money in banks.

[deleted]

Re: Cryptocurrency doesn’t address the hard parts of financial inclusion

#69

Post by tablespoon »

mkdirp wrote: post #31

Cryptocurrencies have never claimed they address the hardest parts of financial inclusion. Cryptocurrencies solve the issue of trust. > We need to keep track of our customers’ account balances. Right. That's what the blockchain is able to do. It can assert that you, who says you have 1 bitcoin in your wallet, actually really have 1 bitcoin in your wallet (assuming no attack vectors such as 51% attack). > We need them…

> Cryptocurrencies have never claimed they address the hardest parts of financial inclusion. Cryptocurrencies solve the issue of trust.

Uh, what now? They actually do a worse job than traditional finance. What happens if I pay for something with a credit card and the vendor fails to deliver? Why I dispute the transaction and get my money back. It's less important that I have absolute trust in the vendor, because I have fall back mechanisms. Cryptocurrencies are deliberately designed so that can't happen.

The only "trust" problem cryptocurrencies solved was keeping track of stuff like account balances in a distributed ledger, but that's purely a problem created by the ideological choice of a distributed ledger.

Re: Cryptocurrency doesn’t address the hard parts of financial inclusion

#70

Post by unholiness »

mkdirp wrote: post #31

Cryptocurrencies have never claimed they address the hardest parts of financial inclusion. Cryptocurrencies solve the issue of trust. > We need to keep track of our customers’ account balances. Right. That's what the blockchain is able to do. It can assert that you, who says you have 1 bitcoin in your wallet, actually really have 1 bitcoin in your wallet (assuming no attack vectors such as 51% attack). > We need them…

The strawman this blog post argues against, who claims part of the upside of crypto is that it will help the unbanked and underbanked soon join the world economy... definitely exists. In large numbers.

It's a naive view, but a common one. It deserves the counter-argument it's getting.

Post reply on HN