Bitcoin's comeback: should Western Union be afraid? • Hacker News Board

Re: Bitcoin's comeback: should Western Union be afraid?

#51

Post by rcthompson » Thu, Dec 22, 2011, 12:13 AM UTC

jfruh wrote: post #41

jordanb wrote: post #16

Earlier quoted context omitted.

"Easy way out of servicing their debt" is a facile misrepresentation of the problem. The problem for a country like, for instance Spain, is that their current account balance has gone highly negative. This can be due to government overspending or private overspending and contraction. In fact Spain didn't have a big public debt problem before the crisis. Their problems stem mostly from contraction of the private secto…

And most importantly Americans are highly mobile; Michiganders can head off to Chicago or Atlanta so while the prospects for Michigan itself remain bleak, people aren't trapped. Hmm, don't Spaniards legally have the same ability to move to Germany to take work on equal terms with Germans? What prevents this from happening in practice? Language barrier, prejudice, or ... ?

Generally you have to jump through some number of extra hoops to work legally in a nation of which you are not a citizen. Different nations have different numbers of hoops, but they all have at least a few, to my knowledge.

Re: Bitcoin's comeback: should Western Union be afraid?

#52

Post by qdog » Thu, Dec 22, 2011, 12:13 AM UTC

weavejester wrote: post #45

omarchowdhury wrote: post #43

Earlier quoted context omitted.

Bitcoins are inherently unlimited - they can be divided down to 8 decimal places for a total of 2.1 quadrillion units.

Do you mean "effectively unlimited"? They're not inherently unlimited in the current implementation; quite the opposite in fact!

I don't think they are "effectively unlimited" either, perhaps closer to "effectively dividable forever", which might not be true, not sure. However, once they are in full circulation they will be a deflationary currency, and giving someone a sliver of a bitcoin that's worth as much as what a full bitcoin was worth at X time in the past is not the same as adding more bitcoins.

I remember one of my economics professors always pre-pending "All other things being equal" before, relating any theories. I keep that in mind every time I start thinking about anything to do with economics, the pile of assumptions on how things are going to work is usually problematic.

Re: Bitcoin's comeback: should Western Union be afraid?

#53

Post by tonfa » Thu, Dec 22, 2011, 12:44 AM UTC

rcthompson wrote: post #51

jfruh wrote: post #41

Earlier quoted context omitted.

And most importantly Americans are highly mobile; Michiganders can head off to Chicago or Atlanta so while the prospects for Michigan itself remain bleak, people aren't trapped. Hmm, don't Spaniards legally have the same ability to move to Germany to take work on equal terms with Germans? What prevents this from happening in practice? Language barrier, prejudice, or ... ?

Generally you have to jump through some number of extra hoops to work legally in a nation of which you are not a citizen. Different nations have different numbers of hoops, but they all have at least a few, to my knowledge.

Correct, the Schengen agreement only allows you to stay (and work, usually) for up to 3 months without a visa.

For longer periods, you need a visa or a work permit (but it is usually much simpler to obtain if you come from the Schengen area).

Re: Bitcoin's comeback: should Western Union be afraid?

#54

Post by ajsharp » Thu, Dec 22, 2011, 12:51 AM UTC

I haven't read the article, but I think I can surmise the correct answer from reading the title: No.

Re: Bitcoin's comeback: should Western Union be afraid?

#55

Post by rauljara » Thu, Dec 22, 2011, 1:24 AM UTC

ajsharp wrote: post #54

I haven't read the article, but I think I can surmise the correct answer from reading the title: No.

I share your skepticism of bit coin. But if you haven't read the article, don't comment.

Re: Bitcoin's comeback: should Western Union be afraid?

#56

Post by weavejester » Thu, Dec 22, 2011, 2:24 AM UTC

freehunter wrote: post #24

DTanner wrote: post #8

I really like the concept of "metacurrency" that this article talks about. This is exactly the area I think Bitcoin will be most successful. I don't ever see it replacing the dollar, or even credit cards. The one thing that Bitcoin really excels at is the instantaneous transfer of unlimited amounts of money from one place in the world to another. Rick Falkvinge talks about this a bit in his "four drivers" series: htt…

Problem is, PayPal et al work in government-backed currencies. You can expect that when someone pays you $1 over PayPal, you'll get $1 worth from it (regardless of how many Euros you'd get for that dollar). However, with Bitcoins you'd be running into the issue of a double exchange. First you'd have to trade your dollars for Bitcoins, transfer the Bitcoins, then trade them back into dollars. You'll always get 1BC whe…

Needing two exchanges instead of one is a disadvantage in the short term, but a big advantage in the long run, because the receiver of money can whatever exchange they prefer, rather than they expect to be most popular with their audience. In essence, Bitcoin is an open protocol for electronically transferring wealth.

Re: Bitcoin's comeback: should Western Union be afraid?

#57

Post by Smirnoff » Thu, Dec 22, 2011, 2:45 AM UTC

Western Union (Business Services) employee here.

I disagree with the author on many levels:

1. Government regulations. Wire transfer industry is a HIGHLY regulated industry. There is no way BitCoin will be able to operate without complying with AML (AntiMoney Laundering) and AntiTerrorist regulations. Many names/countries/organizations are on OFAC list. Thus, the minute you transfer a wire to Mohammad or to someone in Iran it raises a flag and you will spend days if not weeks investigating. Note: I didn't even mentioned all the licences that you need to obtain.

2. FX transfers. Author mentioned transferring bitcoin to India and getting rupees. It's not that easy. Foreign Exchange transfers depend on day of transfer. Thus, waiting or talking to a qualified trader may save you money. This takes time and people. Not sure how bitcoin (1 currency) can solve the process that requires 2 currencies.

3. There are MANY other services that provide better and faster solutions to transfer funds internationally. We were one of them and got acquired by Western Union :)

Finally, bitcoin is a currency. Western Union is a service. That brings us to the major flaw of the article. Western Union facilitates the transfer, while bitcoin is just a medium. WU already uses medium to "transfer" the wires. It's called SWIFT.

Re: Bitcoin's comeback: should Western Union be afraid?

#58

Post by dublinclontarf » Thu, Dec 22, 2011, 3:47 AM UTC

vlasta2 wrote: post #5

Bitcoin's design (limited amount of coins) attracts the wrong kind of people - investors and speculators - there is no wonder the "value" is fluctuating heavily. A real virtual currency must attract buyers and sellers of actual goods, not just get-rich-quick speculators. Maybe an easy change to the way bitcoins are mined would be enough to get it on the right track. If the amount of coins is determined democratically…

Having investors is a bad thing now?

Re: Bitcoin's comeback: should Western Union be afraid?

#59

Post by 120202020 » Thu, Dec 22, 2011, 3:48 AM UTC

My interpretation of Bitcoin is this: electricity = currency.

Bitcoin requires computing power. And that in turn requires electrical energy. And that in turn requires, in most cases, fossil fuels.

What am I missing?

Re: Bitcoin's comeback: should Western Union be afraid?

#60

Post by gleetree » Thu, Dec 22, 2011, 4:17 AM UTC

Smirnoff wrote: post #57

Western Union (Business Services) employee here. I disagree with the author on many levels: 1. Government regulations. Wire transfer industry is a HIGHLY regulated industry. There is no way BitCoin will be able to operate without complying with AML (AntiMoney Laundering) and AntiTerrorist regulations. Many names/countries/organizations are on OFAC list. Thus, the minute you transfer a wire to Mohammad or to someone i…

I've transferred several thousand dollars worth of bitcoins in the last few weeks to a Chinese bank account - the exchange I bought them on didn't know what I wanted the bitcoins for. And the Chinese exchange I sold them on didn't know where I got them from. The act of buying the bitcoins contains no information about their future use. The fees were much lower than Western Union, and since Bitcoin prices are volatile I actually made money on most of the transfers. Bitinstant.com already allows you to send money to anyone in the world using paypal via bitcoin anonymously.

Edit - the point is that bitcoin makes it possible for individuals or small companies to move funds to virtually anywhere in the world. A big multinational corporation facilitating this becomes unnecessary. At some point it will occur to people just to move the bitcoins and not bother converting them to a local currency.