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Fintech dystopia

fintechdystopia.com

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121–130 of 288 posts

Re: Fintech dystopia

#121

Post by baq »

whatshisface wrote: post #111
jernejzen wrote: post #105

As someone working with African companies (legitimate businesses, mid-sized transactions), the key use case is payments in stablecoins—their banking infrastructure doesn’t allow for reliable and consistent foreign remittances. These deals would be practically impossible without stablecoins. (And to be clear, I’m someone who has never been particularly enthusiastic about crypto or blockchain.)

Do you know why people would choose to use stablecoins, rather than trade shares in an ETF that held government bonds, or something like that? That's what stablecoins are, effectively just a share in the holding company's bank account.

Or a CD, or maybe just a bank account. I think of stablecoin issuers as banks because why not: they keep your cash, pay you some yield and promise to give it back to you when you ask them. Walks like a bank, quacks like a bank…

Re: Fintech dystopia

#123

Post by svetb »

paperpunk wrote: post #113
jernejzen wrote: post #105

As someone working with African companies (legitimate businesses, mid-sized transactions), the key use case is payments in stablecoins—their banking infrastructure doesn’t allow for reliable and consistent foreign remittances. These deals would be practically impossible without stablecoins. (And to be clear, I’m someone who has never been particularly enthusiastic about crypto or blockchain.)

Can you give more details on this? Why is it that the existing banking system cannot do this kind of foreign remittance? E.g. correspondent banking via Swift? Is it high fees, is it overly burdensome sanctions/AML checks, something else?

Not OP, but we have contractors in Nigeria, and paying them via regular bank transfer is nearly impossible. For example many banks will outright refuse to make SWIFT transactions to Nigerian accounts.

This is just one example of a few factors that lead to a sort of isolation from international banking.

Re: Fintech dystopia

#124

Post by baq »

pjc50 wrote: post #66
wmf wrote: post #49

Earlier quoted context omitted.

The other legit use for stablecoins is allowing people in Venezuela, Argentina, etc. to hold US dollars while the US government pretends they don't know this is happening. (Officially the US does not encourage dollarization of other economies against their will.) I agree that a centralized US dollar CBDC that isn't run by scammers would be a simpler way to do this.

This is basically the valid use case, yes. It turns the bitcoin goldbug inflation paranoia on its head: the stable currency is defined to be the US dollar, and an elaborate proxy system allows people to access that stability when their local government doesn't want them to. Circumventing exchange controls and so on. Although the current government is having a good go at reducing the value of the currency, it's barely…

> Circumventing exchange controls and so on.

This is the only new thing. Maybe.

Re: Fintech dystopia

#125

Post by carleverett »

lurk2 wrote: post #116
wakawaka28 wrote: post #78

Earlier quoted context omitted.

What you're talking about, resistance to government meddling, is more of a function of the currency than the ledger. Cryptocurrencies only work because of people silly enough to buy them in exchange for actual "valuable" or official currencies (which can be imposed on some people in the world at gunpoint). If a cryptocurrency was forced on you at gunpoint, it most certainly would not be one that provided any anonymit…

> Ideally you could just have a foreign bank account that your country cannot touch. Doesn’t solve the problem as these assets can still be seized by foreign governments.

I can’t really think of a better, more concise pitch for cryptocurrencies than “ideally you could just have a foreign bank account that your country cannot touch.”

Re: Fintech dystopia

#128

Post by dartharva »

Herring wrote: post #4

> Home ownership and the rest of the American dream seem out of reach for many people, and there’s very little safety net available when it comes to healthcare expenses, retirement, or just bad luck. I empathize with the author, I really do, but you can't care about someone more than they care about themselves. If anyone has had the supremely unpleasant experience of trying to get loved ones to work out, they know. T…

Had this been the default attitude of people, humanity wouldn't have progressed past the hunter-gatherer stage.

Re: Fintech dystopia

#129

Post by joshtbradley »

whatshisface wrote: post #111
jernejzen wrote: post #105

As someone working with African companies (legitimate businesses, mid-sized transactions), the key use case is payments in stablecoins—their banking infrastructure doesn’t allow for reliable and consistent foreign remittances. These deals would be practically impossible without stablecoins. (And to be clear, I’m someone who has never been particularly enthusiastic about crypto or blockchain.)

Do you know why people would choose to use stablecoins, rather than trade shares in an ETF that held government bonds, or something like that? That's what stablecoins are, effectively just a share in the holding company's bank account.

I think for the same reason that most people hold cash in a bank account rather than putting all of their money in ETFs/bonds. Convenience, stability, and security.

Consider living in a country with an unstable and fiscally irresponsible government. And having a net worth You don’t need financial literacy, there is no min-buy in like ETFs/bonds, and there is minimal KYC or other identity restrictions. I think this is an incredible boon for the billions of people living in such conditions.

Re: Fintech dystopia

#130

Post by dartharva »

baq wrote: post #127
dartharva wrote: post #122

Sounds like most of American "Fintech" is more about dodging regional laws and restrictions than anything else.

Why limit yourself to American…

Because Fintech in a many places outside of America has been downright awesome and has opened up entire new economies. India is the biggest example.
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