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MasterCard to open up network to cryptocurrencies

reuters.com

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Re: MasterCard to open up network to cryptocurrencies

#401

Post by rowland66 »

tehlike wrote: post #11
PragmaticPulp wrote: post #2

These stories usually spur more enthusiasm for buying cryptocurrency, but ironically those buyers aren’t interested in spending cryptocurrency using their MasterCard. They’re hoping other people will buy cryptocurrency from these announcements, driving the price up. Or, more likely, they’re just hoping other people will buy cryptocurrency and not use it in these spending systems. Spending cryptocurrency would result…

A friend of mine basically put it this way: bitcoin can't become medium of exchange before it becomes medium of value. You can read this as: if you are holding btc, it's in your best interest to hold more without selling.

If your goal is to buy and never sell, then btc is the ideal investment. You can buy the btc, destroy your private key, and nobody will ever be able to sell it, not even your grandkids poking around in the attic 20 years after you have died.

Re: MasterCard to open up network to cryptocurrencies

#402

Post by nmfisher »

solosoyokaze wrote: post #141
maceurt wrote: post #123

I am not big on cryptocurrency. Look how the price of these "currencies" fluctuate like crazy, because people buy and treat it like an investment. What is the actual current practical utility of cryptocurrency except for buying/selling illegal things online? People are so horny to get in on the next computer/iphone/etc that they forget that new ideas can fail.

There is a ton of utility in crypto. Here's one scenario I've never seen discussed but is absolutely real: Imagine you're an abused spouse or child who needs money to escape their situation. Opening up a bank account isn't an option for a lot of people, but anyone can instantly open a crypto "account" and start stashing a nest egg away from the prying eyes of their oppressors. Crypto is the only option for this, and…

Where is this nest egg coming from?

Re: MasterCard to open up network to cryptocurrencies

#403

Post by yarcob »

PragmaticPulp wrote: post #2

These stories usually spur more enthusiasm for buying cryptocurrency, but ironically those buyers aren’t interested in spending cryptocurrency using their MasterCard. They’re hoping other people will buy cryptocurrency from these announcements, driving the price up. Or, more likely, they’re just hoping other people will buy cryptocurrency and not use it in these spending systems. Spending cryptocurrency would result…

> Exchange fees are a great way to charge consumers for spending their own money in 2021, when normal credit cards actually pay people 1-2% to use them

Credit card companies in the US are a special kind of evil. They charge huge fees, force vendors not to pass the fees on to customers, and then pretend to be the consumer's best friend by returning a bit of the fees to them.

They insert themselves between buyer and seller, drive prices up, and their customers think they are saving money.

Re: MasterCard to open up network to cryptocurrencies

#404

Post by lifty »

whitepaint wrote: post #361
seibelj wrote: post #330

Earlier quoted context omitted.

HN should have been on the cutting edge of crypto, given its “hacker” supposed ethos, but a large group of no-coiners couldn’t understand it and have posted the same tired arguments ad nauseum for years. There are a lot of people on HN who love and support crypto but the arguments are exhausting and you get nothing but downvotes. All of my friends and family I convinced to buy and hold have been texting me how I chan…

I've read many good arguments against cryptos here. If 80% drop happens within the next month, nobody really would be surprised. Cryptos can still easily fail. I hold Ether (just it) because what they are doing is really extraordinary but gazillion things might go wrong with it, Bitcoin, and others.

Do you think the code will fail, the consensus model, or there are no uses cases? If you have concerns about this I would love to hear them.

But if you are only afraid that the price can fall 90%, then who cares? Let it fall, there is too much hype anyway, to the point it has created great division between coiners and no-coiners. For example, the 2001 stock market crash, it cleared out projects based on fluff and the rest continued to build. I would reckon we would see a similar dynamic now, but probably with faster market cycles.

Re: MasterCard to open up network to cryptocurrencies

#405

Post by jkepler »

Slartie wrote: post #101
PretzelPirate wrote: post #6

Earlier quoted context omitted.

I’m in the minority in that I’d like to be able to spend my cryptocurrency in a way that: 1. The card handles also selling some off for taxes every transaction and put that in an interest-accruing account. 2. The card tracked my capital gains for each transaction for easy reporting on taxes. 3. The card provider will help manage fees - I’d rather bulk deposit funds to a layer2 and have fee-less payments over having t…

> 1. The card handles also selling some off for taxes every transaction and put that in an interest-accruing account. > 2. The card tracked my capital gains for each transaction for easy reporting on taxes. How should it ever do that? It would basically have to limit you to spend Bitcoin that you acquired over that exact same card (like when you buy Bitcoin via PayPal) and that you hold in a virtual wallet provided b…

> Otherwise they'd be unable to tell how many $ you paid to acquire the Bitcoin you just spent.

This is a massive reconciliation and record keeping overhead problem if you live in a jurisdiction that taxes crypto transactions for capital gains/losses. Michael Saylor said just recently in his interview with What Bitcoin Did that MicroStrategy plans to only use bitcoin as a treasury reserve asset and not as a transactional currency precisely because of the record keeping overhead.

Re: MasterCard to open up network to cryptocurrencies

#406

Post by l_pan_ »

halukakin wrote: post #373
tenaciousDaniel wrote: post #280

Earlier quoted context omitted.

It's sad that this aspect of the conversation so often gets replaced by everything else. This is (IMO) the most important point about digital currency - the promise of providing consumers in unstable economies the chance to convert to a more stable currency without government intrusion. We're still not there, but that should be the north star for crypto (again, in my opinion).

Say everyone in an unstable economy were paid in usd. If that country has foreign deficit, if that country has high government debt. What happens? How can the government keep paying its own employees? How does it pay retiree checks? How does it subsidize farming when needed? As long as a country cannot print usd itself, this is a fast shortcut to unemployment, hunger, etc... Strong currencies are not the solution to…

Well said. I believe this is why the US and many others abandoned the gold standard.

Re: MasterCard to open up network to cryptocurrencies

#407

Post by oillio »

Slartie wrote: post #138
liquidify wrote: post #27

Earlier quoted context omitted.

They couldn't do that. If they didn't actually have any crypto, in the event of a large scale increase in price combined with a large scale cash out, Paypal would have to eat the difference from buy to sell price. They would lose their shirt. At minimum, Paypal is buying some percentage of the crypto sales in actual crypto to act as a hedge. However, it is more likely they are closer to 1 to 1 backing since they prob…

They could just as well hedge the "PayPal-Bitcoin" they hand out to their customers with unbacked Bitcoin futures. They don't necessarily have to buy the underlying as long as they can find some other party who's willing to engage in a bet about the future of the Bitcoin price. Though I must admit that it's doubtful for them to find enough cash to take the other side of this bet, so most likely they have to resort to…

Bitcoin futures are running at about 25% per annum carry.

They absolutely can find counterparties to take that trade, but it would be much more efficient to trade in the spot markets. The real question is if they have custody operations setup to handle the coin.

I expect they outsource these backend operations to the likes of Coinbase, Gemini, or Fidelity. They probably won't allow customers to transfer their Bitcoin out until they move custody in house, which is no easy task.

Re: MasterCard to open up network to cryptocurrencies

#408

Post by xsmasher »

martamorena923 wrote: post #351
gt565k wrote: post #345

Earlier quoted context omitted.

You are so wrong. Spending crypto using a card is actually what people want in order to avoid taxes on crypto as it's treated as a security from the IRS tax perspective. Anyone who has made money on crypto would love it if they can just spend the crypto as currency and buy every day things with it and remove the tax liability from having to convert to fiat. 15% tax capital gains, no thanks, let me spend it on food an…

OMG in what country do you live? 15%??? We have to pay 50% on this in Canada, well at least the ones who are in the top earning bracket. I would gladly pay the 15%. I mean how greedy is it to make these kind of gains in crypto and then trying to avoid a measly 15% of tax lol.

Are you sure you pay 50% in tax on the profits? A quick google suggests that 50% of the profits counts as income, which is then taxed at your income rate. 50*50 = 25% in the top bracket.

In the US long-term cap gains is 0%, 15%, or 20% - not far off from 25%.

Re: MasterCard to open up network to cryptocurrencies

#409

Post by forty »

sz4kerto wrote: post #300
cma wrote: post #285

Earlier quoted context omitted.

How did it lose more than 100% of its value?

I'm living in an EU-member country. Our currency has lost half of its value compared to the USD since 2008. How? 'Slowly and steadily.'

Interestingly we have the opposite problem, our customers mostly pay in USD and many of our employees are paid in EUR, which is pretty high vs USD lately, and that difference costs us quite a lot.

Re: MasterCard to open up network to cryptocurrencies

#410

Post by l_pan_ »

ccheney wrote: post #371
tenaciousDaniel wrote: post #280

Earlier quoted context omitted.

It's sad that this aspect of the conversation so often gets replaced by everything else. This is (IMO) the most important point about digital currency - the promise of providing consumers in unstable economies the chance to convert to a more stable currency without government intrusion. We're still not there, but that should be the north star for crypto (again, in my opinion).

You're right, we're still not there yet. I love the idea of cryptocurrency but it's being treated more like a speculative investment vehicle than a currency for goods & services. Sure, you can buy some stuff with it but its volatility is generated through all of the speculators. It needs to be stabilized if we're ever going to replace fiat currency.

It has already been https://www.investopedia.com/terms/s/stablecoin.asp

Andreessen Horowitz invested $15 million in https://en.wikipedia.org/wiki/Dai_(cryptocurrency)

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