Why we should fear a cashless world • Hacker News Board

Re: Why we should fear a cashless world

#61

Post by flatline » Mon, Mar 21, 2016, 2:18 PM UTC

BIackSwan wrote: post #2

Genuine question - What about a "cashless" currency based on blockchain? (a la bitcoin). Wouldn't it be and not be under any single entity's control at the same time?

The blockchain is mostly a solution in search of a problem. Bitcoin is cool, but I doubt it will ever have large-scale applications beyond DNMs and hacker/hobbyists.

- The current biggest problem that bitcoin faces is one of scale - and there's no clear solution in sight. Why on earth would you want every little transaction on the blockchain? If I buy a stick of gum, that doesn't need to be on public record for eternity. It is impractical and unwieldy.

- Centralized systems are always more efficient than decentralized ones, and systems naturally tend toward centralization. Bitcoin falls down under centralization, which we are also currently witnessing with the hash power tied up by a few largely unknown Chinese operators.

There are proposed solutions like pseudo-centralization with LN where bitcoin just becomes a settlement layer for off-chain contracts - and the details behind LN are still so primitive it is not clear it will actually solve any real problems.

What you are talking about in practice for something at scale is a centralized blockchain of some sort, which is really just a distributed, immutable database, with some sort of trusted signing authority. What exact advantage does that give aside from potentially non-reversible transactions, which are a clear non-starter for most consumer purchases? There are already services that offer true non-reversibility for special cases where this is desired.

There has so far been no viable application for blockchain technology as a replacement for cash except black/grey market purchases.

Re: Why we should fear a cashless world

#62

Post by brewdad » Mon, Mar 21, 2016, 2:20 PM UTC

realusername wrote: post #22

scholia wrote: post #15

Earlier quoted context omitted.

On the plus side, using a card gives you a good list so you can see what you've spent. This makes accounting simpler than using a cash book and accumulating receipts. On the minus side, I use contactless ("wave to pay") all the time now, and find I rarely look to see how much I'm spending on small transactions. Even with larger transactions, it doesn't feel like "real money".

I think it's the opposite for me, using cash makes it way easier to get an idea of how much I spend. I use the ATM three times per month with 100 pounds each so 300 pound/month in normal expenses. With card I would need to to an addition of everything per month.

True, but when the time comes where you need to cut expenses for some reason, do you know where that 300 pounds is going? That is the advantage he was getting at.

I download my transactions weekly from my CC company and can easily see I've been spending way too much money eating out the past two months.

Re: Why we should fear a cashless world

#63

Post by JoeAltmaier » Mon, Mar 21, 2016, 2:22 PM UTC

Olscore wrote: post #59

Olscore wrote: post #24

A good conversation of "why we should fear a cashless world" should at least mention the Book of Revelation and the Book of Daniel in The Bible. It would be negligent to omit them from discussion like this.

Friends who are replying, my intent is not to stir up debate between Christians or about religion. The Books mentioned are relevant to this topic. They are good reading for anyone interested. Based on the down votes it seems HN would rather not include them while discussing this topic; which is all the more reason to go read them for yourself. They remain significant in our modern culture, e.g., music, books, movies…

We generally like to talk about fact and science, and not old spiritualism. Though I have to admit, prophecy remains very popular here! But mostly with HNers taking the role of prophet.

Re: Why we should fear a cashless world

#64

Post by zanny » Mon, Mar 21, 2016, 2:22 PM UTC

unknown_apostle wrote: post #16

BIackSwan wrote: post #2

Genuine question - What about a "cashless" currency based on blockchain? (a la bitcoin). Wouldn't it be and not be under any single entity's control at the same time?

The biggest danger with blockchain is that if it ever fails, it would fail for technological reasons and its failure would be instant and complete. Like encryption being broken. Instead of government money, where the failure is telegraphed years in advance, e.g. by reckless abuse of the printing press.

The equivalent of breaking encryption on bitcoin is perfectly forging paper money, or breaking the security on any financial institution that enables you to steal all their money.

Also, if someone can break sha256, not only is bitcoin screwed, but so is the Internet as we know it and every secure institution period. The overnight "instant and complete" breakage of fundamental assumptions about security would destroy everything. So interestingly, if you could break sha256, you could probably break into almost any financial institution and steal their money as well.

The security of a blockchain is in its popularity. As long as the code is open (and I'll admit, I am not a fan of how bitcoin mixes the default interface (BitcoinQt) and the default implementation (BitcoinCore) together so much) and there is investment in the market, there will be strong financial pressure to consistently and diligently analyze and track the source code for weaknesses.

Bitcoin at 3B has at least a dozen security firms that have looked into its crypto. If you had another crypto that broke a trillion you would have thousands of companies constantly safeguarding and testing the crypto of the currency in the same way Google offers ludicrously high bounties for anyone who can break Android/Chrome/ium security.

Re: Why we should fear a cashless world

#65

Post by throwaway21816 » Mon, Mar 21, 2016, 2:23 PM UTC

It is all about control. If you remove the independence of cash and you end up with government regulation deciding how much, what and where you spend your money. Such regulation can be used to put stress on businesses that the state deems 'unsuitable'[1] as well as punish those with differing opinions than the state[2].

Cashless society would essentially turn the world into one giant PayPal.

1 - https://en.wikipedia.org/wiki/Operation_Choke_Point

2 - https://en.wikipedia.org/wiki/IRS_targeting_controversy

Re: Why we should fear a cashless world

#66

Post by zanny » Mon, Mar 21, 2016, 2:26 PM UTC

adrianN wrote: post #7

BIackSwan wrote: post #2

Genuine question - What about a "cashless" currency based on blockchain? (a la bitcoin). Wouldn't it be and not be under any single entity's control at the same time?

Cash and current forms of electronic payment have the nice feature that the seller gets their money almost immediately. As I understand it, bitcoin transactions take a while to confirm. I wouldn't want to stick around in the shop until some miner got around to my transaction.

The "takes a while to confirm" is a shortcoming of politics in bitcoin today. Blocks are limited to 1MB, there are more than 1MB of transactions almost all the time now, so some transactions (the ones paying the lowest fees) get delayed multiple blocks and take forever to be confirmed.

That will eventually be fixed, and once we are back to normalcy where transactions aren't limited by block size, you can regularly get - even on feeless transactions - multiple confirms in seconds. Your transaction won't be finalized until it enters the block, but once you have a half dozen or more confirms the probability of failure of that transaction entering is extremely low - well below 1% at that point, insofar as I have never seen it happen myself and don't know anybody who has had a multi-confirm transaction miss acceptance.

Re: Why we should fear a cashless world

#67

Post by smt88 » Mon, Mar 21, 2016, 2:26 PM UTC

gizi wrote: post #52

nmrm2 wrote: post #20

Earlier quoted context omitted.

> If you really mean globally, then inequality is in fact falling. No. Inequality is decreasing between nations as the developing world catches up with the west. But inequality within nations -- even developing nations -- is increasing. It's possible for inequality to increase as the the developing world catches up to the west; in fact, that's exactly what's happening. So the old geographical distributions are very s…

> and lessen nation states' ability to combat inequality with policy Ok, one person is a great programmer making good money and another person is not interested in any of that and makes less money. I do not see any inequality here that needs to be combated with policy. One possible result of such policy would be that both will turn out to be less interested. You cannot turn the losers into winners, but you can certai…

> quite a bit of inequality is caused by the fact that some people happen to be smarter

Why does someone deserve to have a worse life because they weren't born that smart? Why do they deserve to be uncertain how they'll be able to pay medical bills, unable to send their children to great schools, and unable to afford healthy food?

In theory, "meritocracy" only favors the lucky -- for example, those born with a love of programming in the year 1985. In practice, "meritocracy" doesn't exist and never has.

Re: Why we should fear a cashless world

#68

Post by agentgt » Mon, Mar 21, 2016, 2:27 PM UTC

carlob wrote: post #53

Here in Italy the big issue is that many business will just not declare cash transactions. It's pretty common not to be given a receipt when buying a coffee and often when you visit a doctor they'll say: do you want the invoice or a discount? A couple of friends got married recently and I found out they paid over half of what the owed in cash to get pretty decent discount. So before we talk privacy and company let's…

This is exactly what happened to Greece (my in-laws are Greek). Greeks and Greek Americans are completely cash based. Consequently the government has no idea how wealthy its residents are and tax evasion is extremely rampant. I'm sure that isn't the only reason to Greece's problems but I bet it did have a huge impact.

Re: Why we should fear a cashless world

#69

Post by majewsky » Mon, Mar 21, 2016, 2:27 PM UTC

carlob wrote: post #53

Here in Italy the big issue is that many business will just not declare cash transactions. It's pretty common not to be given a receipt when buying a coffee and often when you visit a doctor they'll say: do you want the invoice or a discount? A couple of friends got married recently and I found out they paid over half of what the owed in cash to get pretty decent discount. So before we talk privacy and company let's…

So what is it then that makes this kind of fraud common in Southern Europe but practically nonexistent in Germany? (judging from my experience)

Re: Why we should fear a cashless world

#70

Post by studentrob » Mon, Mar 21, 2016, 2:27 PM UTC

carlob wrote: post #53

Here in Italy the big issue is that many business will just not declare cash transactions. It's pretty common not to be given a receipt when buying a coffee and often when you visit a doctor they'll say: do you want the invoice or a discount? A couple of friends got married recently and I found out they paid over half of what the owed in cash to get pretty decent discount. So before we talk privacy and company let's…

Taiwan is mostly cash and they use a receipt lottery to encourage people to buy from vendors who give receipts. Each receipt has a number and there's a lottery at the end of the month with cash prizes.

Also, people here know they can report a business for not giving out receipts. They might get a share of recovered taxes for that.

I don't know all the pros and cons of that setup but it seems there are ways to maintain a cash based system and still collect taxes.