The endless search for a crypto use case • Hacker News Board

Re: The endless search for a crypto use case

#51

Post by amanj41 » Tue, Aug 02, 2022, 4:59 PM UTC

rahimnathwani wrote: post #42

amanj41 wrote: post #31

Earlier quoted context omitted.

it's a little disingenuous not to put remittance on this list as it's one of the few legitimate and not morally dubious ones. I have gotten screwed on exchange fees and wire fees remitting and using crypto is much easier.

Most people receiving remittances need fiat money. For amounts under ~$500, cryptocurrency off-ramps are often less convenient and more expensive than an international cash-to-cash remittance with Western Union or Moneygram.

I have no problem with properly regulated stablecoins (and hoping they come about soon). Blockchains are only necessary for one thing and that is cryptocurrency. Doesn't matter if that currency happens to be a digital representation of EUR or USD or whatever.

If you think they're more expensive to use than centralized providers, you're probably using ethereum or bitcoin. I can send USDC on Algorand in any quantity for less than a cent

Re: The endless search for a crypto use case

#52

Post by sinecure » Tue, Aug 02, 2022, 4:59 PM UTC

The cleanest and easiest use case I see for crypto is just optimizing the whole securities issuance and fund management legacy system. For my business in alternative investments if I want to raise money for a project with a Regulation D offering I need to spend a lot of time and money jumping through hoops and dealing with numerous financial institutions.

The typical flow of information, effort and money goes like this: the sponsor (me) creates the investment opportunity under Regulation D of the SEC ruleset with the help of some securities attorneys, a managing broker dealer (SEC compliance) signs off on it and circulates it to broker-dealers via selling agreements, then, wealth advisors who are registered with those broker-dealers can sell our offering to their clients, those clients then fill out a subscription agreement and send their money to a third party called a transfer agent, the transfer agent takes in the agreements and cash, logs all the details about the investor and manages the payment of distributions with a mixture of direct deposit and paper checks, and generates tax documents via mail, these distributions and tax documents then go to the financial custodian of the asset for each investor.

This process involves 8 to 10 different parties, multiple financial institutions and reams of paperwork. The cost of capital is approximately 11% using this method.

I dream of the day that I can offer a tokenized security on the blockchain, that is held by the investors themselves in their wallet, with distributions paid with USDC directly to their wallets. The reduction in cost would be incredible--all we need is the legal framework to allow it.

Re: The endless search for a crypto use case

#53

Post by TheBlight » Tue, Aug 02, 2022, 4:59 PM UTC

snapcaster wrote: post #3

I mean it has good use cases they're not just the ones that scheme promoters want to be true. I know TFA pokes some holes in the censorship resistance attribute of bitcoin but i think everyone can agree it does provide value transfer solution that is much harder to block than Visa/Stripe/etc. 1). Silk Road or dark net markets in general. Can't be done with Visa or other existing solutions at any kind of scale 2). Fun…

Calling it a scheme seems a bit rough. It's a market mostly unencumbered by regulation (not true of on/offramps), online 24x7 and not directly controlled by governments -- an entirely new asset class with unique properties. It allows for new business/cause funding models. Anyone can participate regardless of "credit rating" or ideology and no one needs a custodian.

Re: The endless search for a crypto use case

#54

Post by bhouston » Tue, Aug 02, 2022, 5:00 PM UTC

snapcaster wrote: post #3

I mean it has good use cases they're not just the ones that scheme promoters want to be true. I know TFA pokes some holes in the censorship resistance attribute of bitcoin but i think everyone can agree it does provide value transfer solution that is much harder to block than Visa/Stripe/etc. 1). Silk Road or dark net markets in general. Can't be done with Visa or other existing solutions at any kind of scale 2). Fun…

5) Running various investment scams such as Ponzis, and pump-and-dumps (AKA rug pulls) in an anonymous fashion. There is a lot of money to made doing this right now...

Re: The endless search for a crypto use case

#55

Post by m348e912 » Tue, Aug 02, 2022, 5:00 PM UTC

rpmw wrote: post #29

librish wrote: post #17

Earlier quoted context omitted.

When you say cheaper and faster, what are you comparing to? If I want to convert and send USD from the US to EUR in Germany the crypto solution will be expensive (trading fees on both legs) and pretty slow (time it takes for the exchange to send EUR to your German bank account).

Yeah this strikes me as odd too. My bank will instantly deposit transfers while the (free) ACH process takes time to clear. I can transfer up to something like $99,999 a day which is fine for my needs. At worst case a $15 fee to wire funds which I could probably get waived if I asked customer support nicely. There is also plenty of recourse in the unlikely event something goes wrong.

With crypto you don't have to ask nicely, you just send. Being your own bank has it's advantages (and risks).

Re: The endless search for a crypto use case

#56

Post by ragnot » Tue, Aug 02, 2022, 5:01 PM UTC

xadhominemx wrote: post #38

game-of-throws wrote: post #32

Earlier quoted context omitted.

My theory is that the likelihood someone understands the use cases is inversely correlated to their trust in government. For example: https://www.bbc.com/news/business-60912789 These articles all follow a common pattern. 1. The trigger – Inflation/distrust in government/bank withdrawal restrictions/paypal freezes your funds/country is at war/etc 2. The response – People gravitate towards a system that is resilient to…

You still have no answer for the crypto on/off ramp issue.

I think the idea would be that in a scenario where crypto becomes a currency, there wouldn't need to be an off-ramp (at least immediately, think war/revolution). You would trade the crypto like "real" money.

Re: The endless search for a crypto use case

#57

Post by ddjsn111 » Tue, Aug 02, 2022, 5:02 PM UTC

xadhominemx wrote: post #43

trixie_ wrote: post #6

The practical use case is pretty simple - being able to hold large sums of money yourself securely while being able to move it to who/where ever you want in less than an hour, 24/7, no questions asked. Before Bitcoin it was practically impossible to do this without a bank as an intermediary and even then would require large fees, talking with people, lots of hang ups, just to manage your own money.

What is the use case of that use case?

No post body was provided.

Re: The endless search for a crypto use case

#58

Post by paulpauper » Tue, Aug 02, 2022, 5:02 PM UTC

Nomad was hacked. Unless the hackers are generous and return the $--or--somehow used a weak private key to store the eth, there is no way to get the $ back even in the age of the universe. That's the 'use case' I suppose: One-way, irrevocable money transfers and storage.

Re: The endless search for a crypto use case

#59

Post by robin_reala » Tue, Aug 02, 2022, 5:03 PM UTC

sinecure wrote: post #52

The cleanest and easiest use case I see for crypto is just optimizing the whole securities issuance and fund management legacy system. For my business in alternative investments if I want to raise money for a project with a Regulation D offering I need to spend a lot of time and money jumping through hoops and dealing with numerous financial institutions. The typical flow of information, effort and money goes like th…

But why bother with blockchain in that case? What you’re describing is a legal solution centralised by the government, and any hash tree with work in a non-distributed situation.

Re: The endless search for a crypto use case

#60

Post by amanj41 » Tue, Aug 02, 2022, 5:03 PM UTC

wmf wrote: post #35

amanj41 wrote: post #31

Earlier quoted context omitted.

it's a little disingenuous not to put remittance on this list as it's one of the few legitimate and not morally dubious ones. I have gotten screwed on exchange fees and wire fees remitting and using crypto is much easier.

You're in a very small minority. https://www.saveonsend.com/bitcoin-blockchain-money-transfer...

don't have time to read the article so I'll take your word for it, but I will note that upon skimming it seems to really look at bitcoin a lot. Bitcoin might be one of the worst cryptocurrencies to remit.

I will concede international transfers is not a very large use case, and definitely doesn't justify the market capitalization of the blockchain base currencies FWIW