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Bitcoin: the Stripe perspective

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Re: Bitcoin: the Stripe perspective

#101

Post by aeturnum »

>However, Bitcoin has huge potential as a way to transport value. It’s surprisingly difficult to move money today, and the experience of paying for something online is just about the only part of the internet that hasn’t changed dramatically in the past twenty years.

Based on my very limited understanding, the difficulty in moving money has nothing to do with technical limitations of money (it's not like we lack the technology to transfer dollars electronically) and everything to do with regulation. Does bitcoin only offer a "reset" button for regulation? The restrictions on money transfers exist because stakeholders in the finance system want them there - why wouldn't they implement the same restrictions for *coin?

I suppose you could try to exploit the semi-anonymity of bitcoin to avoid regulation, but that doesn't seem attractive to most businesses.

Re: Bitcoin: the Stripe perspective

#102

Post by [deleted] »

chadkruse wrote: post #28
nlh wrote: post #5

This is one of the best posts on the "state of the Bitcoin economy" I've read yet. They nail a few key points that shows they get it in a real-world sense. * Mass-consumer adoption of Bitcoin is a tough sell in developed countries (USA, etc.) * Bitcoin the Network may ultimately be more valuable than BTC the currency * "No chargebacks!" is a pitch to merchants for BTC, not consumers. Consumers like chargebacks & trus…

> This says to me that Stripe's position is ultimately to be...the SWIFT of Bitcoin. Agreed. To illustrate how broken the SWIFT system is for those unfamiliar with international wires: Last week I wired AUS$2,500 from an account I control in Australia to an account I control in the US. It touched 4(!) banks in the process, who collectively took ~$45 in fees ($25 of that being a total surprise to me, represented only…

[deleted]

Re: Bitcoin: the Stripe perspective

#103

Post by jarek »

chadkruse wrote: post #28
nlh wrote: post #5

This is one of the best posts on the "state of the Bitcoin economy" I've read yet. They nail a few key points that shows they get it in a real-world sense. * Mass-consumer adoption of Bitcoin is a tough sell in developed countries (USA, etc.) * Bitcoin the Network may ultimately be more valuable than BTC the currency * "No chargebacks!" is a pitch to merchants for BTC, not consumers. Consumers like chargebacks & trus…

> This says to me that Stripe's position is ultimately to be...the SWIFT of Bitcoin. Agreed. To illustrate how broken the SWIFT system is for those unfamiliar with international wires: Last week I wired AUS$2,500 from an account I control in Australia to an account I control in the US. It touched 4(!) banks in the process, who collectively took ~$45 in fees ($25 of that being a total surprise to me, represented only…

That's 1.8%. What are the current spread rates for AUD-BTC and BTC-USD?

For comparison I get 0.6 - 1.4% from an online specialized currency service, taking a couple of days. Set-up was a bit involved. How good is connecting BTC to real world bank accounts these days?

Re: Bitcoin: the Stripe perspective

#104

Post by pmorici »

rsp1984 wrote: post #97
napoleond wrote: post #9

This is my favourite article about Bitcoin to date, and properly describes one of the main ideas I wish Bitcoin detractors would come around to. Bitcoin has a lot of problems as a unit of account and as a store of value, but that is not primarily what Satoshi was building ( https://bitcoin.org/bitcoin.pdf ). Bitcoin is, and has always been, a medium of exchange first and foremost. It still has some shortcomings in th…

Let me ask a dumb question: If money exchange is the main problem that Bitcoin solves, then why isn't the problem of money exchange attacked directly instead, i.e. through some other less volatile classical stores of value like gold or stock? Why is money exchange a problem anyway and why couldn't a classical wire transfer solve the problem? The article doesn't say anything about these things and the underlying princ…

The answer for why Bitcoin instead of Gold or stocks or whatever comes down to trust and logistics. Take Gold for example you have to have to either ship the gold around which is expensive and slow or have a trusted third party store the gold and handle netting out the transactions between entities or accept delayed payment and trust that the counter party will deliver the underlying asset. Bitcoin does not require trust in anything except the math underlying the system.

Re: Bitcoin: the Stripe perspective

#105

Post by Natanael_L »

ceallen wrote: post #78
natrius wrote: post #17

Earlier quoted context omitted.

Transactions are instant unless the sender double spends. Wait ten minutes for anonymous senders. Trust known senders, then blacklist their identity for instant transactions if bad behavior is detected. This is effectively what any merchant who accepts credit cards does today. Credit card transactions look instant, but can be rejected weeks later. If the blockchain is too heavy, why are miners willing to process tran…

Individual transaction fees are being heavily, heavily subsidized by block rewards currently. Just eyeballing the current numbers: ~400 transactions per block, 25 btc reward, ~500 usd / btc gives a transaction cost of 31 dollars each. What happens to fees when mining rewards taper off? Just authoritatively stating "it'll be fixed" blindly pushes these problems into the future.

Transaction count will go up, and nothing says the value given to miners must stay the same. It is fine if some miners leave due to unprofitability.

Re: Bitcoin: the Stripe perspective

#106

Post by foobarqux »

rsp1984 wrote: post #97
napoleond wrote: post #9

This is my favourite article about Bitcoin to date, and properly describes one of the main ideas I wish Bitcoin detractors would come around to. Bitcoin has a lot of problems as a unit of account and as a store of value, but that is not primarily what Satoshi was building ( https://bitcoin.org/bitcoin.pdf ). Bitcoin is, and has always been, a medium of exchange first and foremost. It still has some shortcomings in th…

Let me ask a dumb question: If money exchange is the main problem that Bitcoin solves, then why isn't the problem of money exchange attacked directly instead, i.e. through some other less volatile classical stores of value like gold or stock? Why is money exchange a problem anyway and why couldn't a classical wire transfer solve the problem? The article doesn't say anything about these things and the underlying princ…

Beside the fact that it already exists, I think the best argument would be that the BTC network didn't require coordination between financial institutions or a design committee.

Re: Bitcoin: the Stripe perspective

#107

Post by Bakkot »

rsp1984 wrote: post #97
napoleond wrote: post #9

This is my favourite article about Bitcoin to date, and properly describes one of the main ideas I wish Bitcoin detractors would come around to. Bitcoin has a lot of problems as a unit of account and as a store of value, but that is not primarily what Satoshi was building ( https://bitcoin.org/bitcoin.pdf ). Bitcoin is, and has always been, a medium of exchange first and foremost. It still has some shortcomings in th…

Let me ask a dumb question: If money exchange is the main problem that Bitcoin solves, then why isn't the problem of money exchange attacked directly instead, i.e. through some other less volatile classical stores of value like gold or stock? Why is money exchange a problem anyway and why couldn't a classical wire transfer solve the problem? The article doesn't say anything about these things and the underlying princ…

The answer to basically all of your questions is that to transfer money, you need to move money. This can be basically a promise of money, as with wire transfers, or physical, as you'd do by transporting bullion or cash.

The problem with using a promise to move money is that you have to trust whoever's promising. That works alright if there's a central authority, like a bank, but less well if you don't want to trust the authority, don't have access to the authority, or are unable to comply with the rules of the authority. Also it's kind of a shitty experience, as is. (You wouldn't pay for all of your Amazon purchases with wire transfers, I'd imagine.)

The problem with moving physical money is that it's difficult to do over long distances or en masse.

In order to solve the problems with existing money transfer, then, bitcoin needs to be able to do without a central authority and without using a physical representation of money. Which it accomplishes by allowing you to store money - not just a representation or promise thereof - digitally.

Re: Bitcoin: the Stripe perspective

#108

Post by marcosdumay »

mcs wrote: post #66

What about a voting system? With little keychains given out with only the voting system having the public key for, and any third party can validate the votes. "Coins", or voting credits can be distributed back to voters without transaction fees.

It has the same problem of every cryptographic (and not cryptographic - see paper) voting system. It's impossible to create a system that assures both a correct result and voter anonymity.

Paper assures none, but has quite strong guarantees on both. I'd settle on some system that assures the result, and has good guarantees of anonymity, what one can create with pseudonyms, but at that point it's a political debate, not a technical one.

Re: Bitcoin: the Stripe perspective

#109

Post by Natanael_L »

Taek wrote: post #49
jarin wrote: post #30

Taking this a step further, when using it as a pure transport medium, the cryptocurrency itself doesn't matter. It could be Bitcoin, Litecoin, Dogecoin, 2304293f20983uf2089j2f3coin, or whatever, as long as it's liquid enough to convert back and forth. What we really need is a gateway system that will intelligently convert between your local currency -> the cryptocurrency with the best liquidity/exchange rate -> the d…

I see the future of cryptocurrency as being a bunch of behind-the-scenes transactions where the currency you are using isn't relevant at all, because everything will be hyper-liquid. You pick you favorite currency (or portfolio) as a store-of-value, and then if you need to trade with other people, your client and portfolio negotiates with their client and portfolio to arrange an acceptable exchange. Then you use a de…

Most of those examples lead to counterparty risk, unfortunately, where there must by some direct trust in the issuer on some level.

Re: Bitcoin: the Stripe perspective

#110

Post by embolalia »

krschultz wrote: post #56
jarin wrote: post #30

Taking this a step further, when using it as a pure transport medium, the cryptocurrency itself doesn't matter. It could be Bitcoin, Litecoin, Dogecoin, 2304293f20983uf2089j2f3coin, or whatever, as long as it's liquid enough to convert back and forth. What we really need is a gateway system that will intelligently convert between your local currency -> the cryptocurrency with the best liquidity/exchange rate -> the d…

I agree with this completely. BTC is proving out the idea, but the total market cap is only $8 billion. What stops Goldman Sachs from seeding a cryptocurrency tomorrow with a market cap that massively eclipses BTC? The big IBanks are sloshing billions and billions of dollars around all the time. There is this assumption that BitCoin is so big that it is the winner, but it is "so big" relative to a bunch of people tha…

The thing that stops them is the lack of a reason to start them. Why would Goldman throw that much money at a new system, rather than using the existing one? Bitcoin has an existing user and development base; it's proven, whether it's at full scale or not. Goldman does not have a guarantee that their hypothetical coin will gain any acceptance outside their walls. And Goldman would have to ask themselves that same question - "If we can create a successful coin overnight, why can't BoA or Chase?" If Goldman can do it, their competitors can, so that $8 billion they apparently have sitting around with no better investments to make is better spent on getting an early hold on Bitcoin.

And, of course, this all assumes that big banks are forward thinking enough to see coins as worthwhile, and that they have the kind of developer power in a new and obscure area to outperform 5 years of FOSS development before anyone else beats them to it.

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