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Patreon cuts deep inside creators’ pockets

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Re: Patreon cuts deep inside creators’ pockets

#251

Post by incangold »

munificent wrote: post #142
rglullis wrote: post #131

Earlier quoted context omitted.

> The crypto bros totally miss the point in understanding this too. I don't know which "crypto bros" you've been talking to, but as someone who is building a self-hosted payment gateway for crypto [0], the benefits from using crypto are two-fold: it eliminates the chance of fraud and it moves the cost of customer support to the merchant. Also, once again I will have to repeat that no one sane will try to completely r…

> it eliminates the chance of fraud Declaring a priori that all transactions are legitimate doesn't eliminate fraud, it just eliminates the system's ability to handle it. Actual humans can still get victimized. The gateway just says "Lalala can't hear you not my problem." > and it moves the cost of customer support to the merchant. Likewise, it moves the consequences of fraud onto the victim. > for the cases where th…

Having been involved with fincrime teams at retail banks, I don’t think this can be said enough.

There are so, so many bad actors and it costs every payment platform so, so much more than I imagined before I saw it from the inside.

Someone commented disparagingly along th lines of f “try calling your bank after fraud and see if you get the money back”. My experience having been victim of financial crime 3 times is that the bank ate the cost every time. That’s part of the value proposition. Building a ledger is relatively easy- stopping people taking the piss is a nightmare.

Re: Patreon cuts deep inside creators’ pockets

#252

Post by TheOtherHobbes »

rglullis wrote: post #156
munificent wrote: post #142

Earlier quoted context omitted.

> it eliminates the chance of fraud Declaring a priori that all transactions are legitimate doesn't eliminate fraud, it just eliminates the system's ability to handle it. Actual humans can still get victimized. The gateway just says "Lalala can't hear you not my problem." > and it moves the cost of customer support to the merchant. Likewise, it moves the consequences of fraud onto the victim. > for the cases where th…

You are thinking only from the side of a customer, who already has it easy with the existing payment networks. If you are a customer that wants to make a transaction that can be reversed, you go for the credit card. If the value of the transaction is not high enough for you to care (micropayments) or if you rather lose some money but not give away your data, you go for crypto. The problem that crypto can solve is for…

Because you're moving risk around without fixing anything.

Why would payers use a system which allows fraudsters to screw them over without recourse?

Crypto is not a solution because this is one of many problems that can't be solved with technology.

The real issue is that some people are consistent bad actors. You can't deal with that on a per transaction basis.

You'd need some kind of social credit system which assesses behaviour for trustworthiness accurately, independently, and objectively - instead of by personal feedback or by half-finished algorithm without appeal.

Even if such a thing were possible, everyone would consider it an intrusion on their privacy.

Re: Patreon cuts deep inside creators’ pockets

#253

Post by pixl97 »

npc12345 wrote: post #150
munificent wrote: post #142

Earlier quoted context omitted.

> it eliminates the chance of fraud Declaring a priori that all transactions are legitimate doesn't eliminate fraud, it just eliminates the system's ability to handle it. Actual humans can still get victimized. The gateway just says "Lalala can't hear you not my problem." > and it moves the cost of customer support to the merchant. Likewise, it moves the consequences of fraud onto the victim. > for the cases where th…

Try zelleing a scammer, call the bank, then get back to us buddy.

That's why you don't.

Re: Patreon cuts deep inside creators’ pockets

#254

Post by TheOtherHobbes »

rglullis wrote: post #223
vorpalhex wrote: post #220

Earlier quoted context omitted.

I sue you. The court demands you appear and return the payment. The Merchant says "No! This was crypto! No give backsies". The Merchant will discover that the state does in fact have finality on the movement of value.

The payment was final. The purchase was not. The refund is another payment. "But the state can still compel you to pay back". Yes, sure it does. The point is that the cost of doing it now is much higher and it is enough to deter a lot of opportunistic, fraudulent behavior from consumers. This difference in cost can make or break a business.

It also encourages a lot of opportunistic, fraudulent behaviour from merchants, because the cost of perpetrating fraud is lowered.

So you end up with a system that most people won't touch, and only appeals to users who need to make shady transactions.

In which case they may just as well leave out the middle merchant and exchange crypto directly.

Re: Patreon cuts deep inside creators’ pockets

#255

Post by meowkit »

Jakawao wrote: post #238
tatertots1234 wrote: post #236

Earlier quoted context omitted.

> The crypto bros totally miss the point in understanding this too. The crypto folks are pretty cognizant of it, which is why they built an entire technology that isn’t reliant on intermediaries, banks, and payment processors to manage transactions. A crypto Patreon in stablecoin like DAI on an L2 would basically be able to remove most of the high fees creators see in Patreon.

That doesn’t address the criticism. If I pay for a good or service via crypto and it is not delivered satisfactorily, what is my remedy? Who even decides what “satisfaction” is? Yes, the dispute/chargeback process for cards is cumbersome today, but it is a solution - albeit inefficient. What is the crypto answer? I don’t mean to put you on the spot for this question, but I would love to understand how decentralized s…

> If I pay for a good or service via crypto and it is not delivered satisfactorily

In this vague hypothetical situation, what a lot of crypto folk would tell you is that you should use a smart contract, and not a regular transaction, to pay. Hypothetically the contract/network will act as an escrow agent, and would only complete the transaction when all input parameters are true AKA all parties are "satisfied". The successful input parameters and their truth sources would be agreed upon before hand.

I could argue more specific scenarios around fraud (buyer receives a good/service and pretends it was not satisfactory), but that can go on forever and I would encourage readers to go search for answers to specific edge cases because they are out there.

Re: Patreon cuts deep inside creators’ pockets

#256

Post by TheOtherHobbes »

rglullis wrote: post #215
gingerlime wrote: post #189

Earlier quoted context omitted.

Or 3DSecure which is becoming very common in Europe. No chargebacks.

3Dsecure helps against criminals try to use the card and makes it harder for customers flag a transaction if they have provided the authorization code. It helps, but does not prevent chargebacks. If you are selling digital goods, a malicious customer could, e.g, make the payment, access the download page of the product and then file a chargeback saying the received product does not match what was advertised.

Many digital merchants in the EU have a rights waiver box to eliminate this kind of opportunism.

Re: Patreon cuts deep inside creators’ pockets

#257

Post by luma »

rglullis wrote: post #243
luma wrote: post #235

Earlier quoted context omitted.

From the point of view of the merchant, crypto is riddled with fraud: https://www.pcgamer.com/50-of-transactions-were-fraudulent-w... If crypto truly solved all the problems you claim it solves, I think it’s reasonable for the major online marketplaces and vendors to have already switched over. I’ll note that they haven’t, and the state of the overall crypto market in the past few weeks suggests one good reason why.

I'd really like that more information was provided in the article. What is he counting as a "fraudulent transaction"? > If crypto truly solved all the problems (...) vendors would have already switched over. Transaction fees are not solved yet. UX is not solved yet. Privacy is not solved yet. (Well, it is if you count Monero, but for commerce you need a stabletoken, and you can not easily build a stabletoken on Moner…

It has a lot to do with crypto for payments if the vendor has to deal with massive swings in value over very short time frames. The solution that most vendors wind up with is getting their crypto exchanged for not-crypto ASAP, which is useful solution but not much of an endorsement for having accepted crypto in the first place.

Re: Patreon cuts deep inside creators’ pockets

#258

Post by cowtools »

deanCommie wrote: post #240
finfinfin wrote: post #218

Earlier quoted context omitted.

Yes. Creators should upload content to Imgur and ask supporters to pay them directly through PayPal. That’s a fantastic alternative to Patreon.

https://news.ycombinator.com/item?id=9224

I mean, he's right. all these file-sharing services like dropbox merely exist because the general public doesn't know how to use something like bittorrent.

Maybe you can grift off of that ignorance for a while, but that doesn't mean it's a sustainable business model.

Re: Patreon cuts deep inside creators’ pockets

#259

Post by rglullis »

scatters wrote: post #249
rglullis wrote: post #187

Earlier quoted context omitted.

Come to Berlin and marvel at how many cash-only shops we have. And if you are talking about internet retailers, can we make an exercise to think of how many new businesses would be viable if transactions of 20 cents were a thing?

Why is that? Is Berlin more prone to credit card fraud than usual for Europe?

Two explanations I've heard: (1) small-shop owners simply do not want to pay the fees to card processors and (2) people are more privacy-minded here and distrustful of both the government and the banks, so they don't use credit/debit cards for purchases as often.

Re: Patreon cuts deep inside creators’ pockets

#260

Post by rglullis »

luma wrote: post #257
rglullis wrote: post #243

Earlier quoted context omitted.

I'd really like that more information was provided in the article. What is he counting as a "fraudulent transaction"? > If crypto truly solved all the problems (...) vendors would have already switched over. Transaction fees are not solved yet. UX is not solved yet. Privacy is not solved yet. (Well, it is if you count Monero, but for commerce you need a stabletoken, and you can not easily build a stabletoken on Moner…

It has a lot to do with crypto for payments if the vendor has to deal with massive swings in value over very short time frames. The solution that most vendors wind up with is getting their crypto exchanged for not-crypto ASAP, which is useful solution but not much of an endorsement for having accepted crypto in the first place.

When I am talking about payments with "crypto" it also includes stabletokens, which don't have this problem.

(And no, not all stabletokens are created the same. Tether is poison and everyone should stay away from it. The "algorithmic" stabletokens are already provably not viable. But DAI has managed to survive even worst market crashes than the current one, and USDC still has some semblance of trustworthiness.)

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