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Fintech dystopia

fintechdystopia.com

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Re: Fintech dystopia

#141

Post by baq »

ptero wrote: post #88
dotcoma wrote: post #34

Earlier quoted context omitted.

Financial blow-up of what kind, in your opinion? The stock market? Loans? Real estate? Crypto? Thanks.

IMO US is heavily exporting its inflation by leveraging its world reserve currency status as other countries have to buy it's treasuries (petrodollar system legacy). No other country would be able to run 30+% budget deficits and sell long duration government bonds under 5%. This will break, sooner or later. When external buyers stop buying treasuries US will have to massively inflate its money supply, taking bondhold…

This is already happening if you know where to look and it isn’t esoteric data. The share of retail in treasury buyers has been increasing for years. If the administration doesn’t reduce spending (it won’t since it can’t) yields will blow out, we had a taste of this a couple times in the past years. Watch 5.5% on the 10. Expect YCC. Possibly buy gold if you think of buying treasuries…

Re: Fintech dystopia

#142

Post by joshtbradley »

dotcoma wrote: post #2

> They aren’t as stable as they claim to be, and the stability they do have arises from free-riding on the US banking system and monetary policy – and as we’ll come back to, if stablecoins are able to keep gaining market share, these parasites might eventually endanger their hosts.

Strong statement, where is the evidence? The GENIUS Act is quite brilliant in my opinion. It strengthens the dollar by simultaneously creating demand for USD and US Treasuries.

Re: Fintech dystopia

#143

Post by andsoitis »

fragmede wrote: post #98
andsoitis wrote: post #90

Earlier quoted context omitted.

> When you "transfer money" from your bank account to another, your bank has to physically move the associated cash from it's vault to the other banks vault, by hiring secure trucks, people, and so on. That’s not at all what happens! Transfers are done digitally, physical cash does not move between vaults or bank branches.

Since the invention of the computer, sure, but before that, yes they did at some point reconcile. Even today, cash still physically moves from the mint to banks to consumers.

In the US, fewer than 18% of consumer transactions are made with cash, and it is declining.

Re: Fintech dystopia

#144

Post by joshtbradley »

cactusfrog wrote: post #65

I think the biggest problem with fintech is that the financial system is already decentralized, and full of tech. It really just seems like it involves using unregulated technology, which allows the skipping of restrictive regulations. This might actually be a good thing, but once a path has been proven to be non destructive the banks can just take over the market by begging the government for deregulation.

Except that stablecoins are strictly regulated thanks to the GENIUS Act and hopefully the CLARITY Act will provide the same guidelines for crypto as a whole. Gary Gensler did nothing to create regulation. David Sacks is out there doing God’s work.

Re: Fintech dystopia

#145

Post by dotcoma »

joshtbradley wrote: post #142
dotcoma wrote: post #2

> They aren’t as stable as they claim to be, and the stability they do have arises from free-riding on the US banking system and monetary policy – and as we’ll come back to, if stablecoins are able to keep gaining market share, these parasites might eventually endanger their hosts.

Strong statement, where is the evidence? The GENIUS Act is quite brilliant in my opinion. It strengthens the dollar by simultaneously creating demand for USD and US Treasuries.

I was merely quoting the author, in Chapter 3, in the paragraph just before > Stablecoins around the world

https://fintechdystopia.com/chapters/chapter3.html

Re: Fintech dystopia

#146

Post by carleverett »

bergen wrote: post #107
barumrho wrote: post #62

Earlier quoted context omitted.

This seems to misunderstand stablecoins since it is useless for investing/speculation as the value is just $1 if it's successful in its goal.

I'd argue crypto casinos (pump.fun comes to mind) would not work without stablecoins because no one would back them with real dollars.

But stablecoins are backed by real dollars.

People hold dollar-backed stablecoins because they believe the US dollar to be the most durable unit of account on the planet.

All the proof you really need for that is that most crypto users outside the US still consider the value of their crypto tokens in terms of how many US dollars it’s worth.

The author of this article talks about this being a “parasite” to the US monetary system, but it’s hard to think of a better thing that could’ve happened for the US. Not only has it reinforced that dominance… it’s also driven hundreds of billions of dollars of US treasury bills purchases from providers like Tether and USDC.

https://tether.to/en/transparency/?tab=reports

Re: Fintech dystopia

#147

Post by lmm »

ryandrake wrote: post #15
jongjong wrote: post #7

I was in relatively early in the web as a developer, I was in early on the crypto movement, also as a developer. These technologies didn't fix the problems. There is too much regulation, you can't do anything without a license. The only solutions are political, not technological. Everything feels like a scam within a scam. I feel dizzy just thinking about it. I'm completely demoralised. Everything related to career f…

> These technologies didn't fix the problems. There is too much regulation, you can't do anything without a license. The only solutions are political, not technological. > Everything feels like a scam within a scam. I feel dizzy just thinking about it. I'm completely demoralised. Everything related to career feels pointless, sisyphean because of the bureaucracy. Any work that pays well is useless at best, harmful at…

> None of this is because of regulation.

Disagree. Zoning law and regulation-driven credentialism are the closest thing to a root cause you can find for most of the problems with modern society; sure you can say "greed" but that's a permanent part of human nature, and most societies find a way to live with it. Today's world where for a family to succeed both parents have to be putting 40+ hours into bullshit fake work in a circular economy of bullshit fake solutions to bullshit fake problems so that they can afford to get their kids the right bullshit fake qualifications is a distinctly regulation-based phenomenon.

> These uncountable scams are all because of unregulated greed and profit.

Sure. But are they actually any worse than the regulated scams? Often the licensed and regulated stuff hurts the end victim more than the direct scams.

Re: Fintech dystopia

#148

Post by dmantis »

This is a very American-centric post.

E.g."Stablecoins won’t bank the unbanked, because people get stablecoins by purchasing them on a crypto exchange, and no crypto exchange will open an account for a customer unless they have a bank account."

Well, I understand that US has dystopia level of financial surveillance, but in many places in the world you can change cash in person to crypto without many issues. And you don't need to use any major exchange for that, that defeats the whole point.

And yes, Russians, Iranians, Palestinians are known to use crypto, for example. And the majority of them don't have US bank accounts.

One of the core features of crypto that it's not an American (or anyone else) thing, like paypal, stripe, or any other system and American laws can be easily ignored if both parties are outside of the US. That's already a very liberating feature for at least a billion of people of nations hostile to the US and potentially to 8+ billions of people more.

Re: Fintech dystopia

#149

Post by kkfx »

raytopia wrote: post #18

Beside Cryptocurrency and GNU Taler have there been anyother attempts at p2p digital currency?

Like GNU Taler, who born out of eCash, born out of an idea of David Chaum in 1982 (see https://youtu.be/DDsQCcuST6c for a nice introduction) there was

- https://en.wikipedia.org/wiki/Mondex (Mastercard)

- https://en.wikipedia.org/wiki/Visa_Cash

And there is ongoing from the BIS https://www.bis.org/about/bisih/topics/cbdc/tourbillon.htm beside that there are many CBDC projects designed for inter-banks usages or some for wide public usage.

Re: Fintech dystopia

#150

Post by digital_voodoo »

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?

It's high fees, burdensome sanctions/AML checks (especially if the said country has been recently or is still on a GAFI list), plus the suboptimization of the core banking systems regarding international transfers, that make the whole things happen in weeks (or sometimes never happen if the end beneficiary doesn't start pinging, emailing or phoning its bank every now and then). The whole unreliability/unpredictability of the thing makes it undesirable for regular operations.
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