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Fintech dystopia

fintechdystopia.com

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Re: Fintech dystopia

#71

Post by praptak »

didibus wrote: post #40
willprice89 wrote: post #3

> people are either still too afraid of looking like they don’t understand, still too deferential to Silicon Valley’s supposed technological expertise, or still too busy doing other things, to voice any skepticism about blockchain-based solutions I'm not afraid of looking like I don't understand - I simply don't understand. I've tried reading a few "yellow papers" for crypto projects and they are so abstract and full…

It helped me to start from the problem it tries to solve. Fundamentally, we've been making digital versions of everything. We have digital phone calls, television, bookkeeping, document writing, drawing, etc. One thing we didn't have digitally was a currency. Why would we want a digital currency? For similar reasons to all the other stuff above. It's more convenient. When you "transfer money" from your bank account t…

"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."

Payment settlement is a solved problem and very rarely involves physical cash transfer. Most of this is just numbers moved between accounts which commercial banks have with a central bank.

Re: Fintech dystopia

#72

Post by mattbillenstein »

I looked at crypto a little for a startup - the thing that isn't usually mentioned is the huge downside of custody. Not your keys, not your coin - and holding those keys securely, think fire, theft, hacks, backdoored hardware wallets, etc - is really really hard to get correct. And if you mess up once anywhere - poof - all your money is gone and there's nothing you can do to get it back.

Re: Fintech dystopia

#73

Post by seanhunter »

jcranmer wrote: post #57
didibus wrote: post #40

Earlier quoted context omitted.

It helped me to start from the problem it tries to solve. Fundamentally, we've been making digital versions of everything. We have digital phone calls, television, bookkeeping, document writing, drawing, etc. One thing we didn't have digitally was a currency. Why would we want a digital currency? For similar reasons to all the other stuff above. It's more convenient. When you "transfer money" from your bank account t…

> 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 hasn't been true for, uh, centuries. It's like literally the entire point of banking, to allow financial transactions to take place without having to physically haul around collateral anywhere. (And if you want a…

Yes and for people who think “centuries” is an exaggeration, the knights templar gained their power and wealth in the middle ages specifically because people could use their promissory notes to exchange for cash so that they didn’t have to physically transport valuables around between Europe and the middle East during the time of the crusades. They allowed people to deposit cash at temple church in London and withdraw it in Jerusalem.

See https://www.bbc.com/news/business-38499883 and elsewhere.

It’s really telling how poor the knowledge of financial history and the existing state of the art in traditional financial tech there is among people in the crypto-boosting space. Many of the “innovations” they claim have been around in traditional finance for hundreds of years.

Re: Fintech dystopia

#75

Post by eszed »

CaptainFever wrote: post #70
johncole wrote: post #45

Earlier quoted context omitted.

I agree, I see very few (none) use cases for crypto that aren’t human misery trafficking. This article seems to explain that well.

Buying NSFW things.

I think the further down the supply chain of "NSFW things" you go the more closely it resembles "human misery trafficking".

Re: Fintech dystopia

#76

Post by basilium »

The use case for crypto (eth) and stables (dai) at least for me is clear as day 1) to be able to save money 2) to be able to freely take it with me anywhere (on a vacation for example)

Having no other way to do these simple things, from my point of view, it is not a problem of hundred thousand people in Venezuela, it's a valid problem of tens (if not hundreds) of million people around the world.

IMO The author significantly underestimates how limited and inaccessible the current financial system in the world is.

Re: Fintech dystopia

#77

Post by ecocentrik »

jongjong wrote: post #42
ecocentrik wrote: post #38

Earlier quoted context omitted.

Not all regulation is a symptom of greed. Regulation can be written and passed with the intention of protecting the public good, promoting public health, preserving fair competition... That it sometimes works counter to those goals is a function of greed, a lack of accountability and and a lack of transparency. We write these laws with consistent check on accountability and transparency, but we keep electing sociopat…

True as well but personally I prefer people to regulate themselves though for that to happen, there needs to be very strong punishment for violations. Harm mitigation should be at the forefront of everyone's minds. Not quite compatible with the 'limited liability' legal construct. People won't regulate themselves unless they are afraid of consequences. The regulation + limited liability combo takes away fear. The big…

I have personal experience with companies that consistently violate environmental regulations with very little understanding of the regulations they are violating beyond their effect on profit margins. They pay the fines or pay environmental engineers to help them pass an inspection that could potentially disrupt operations and are violating the same statutes 6 months later. The only regulatory clarity they care about is knowing which regulations can impact production and which can be gamed or paid off.

Re: Fintech dystopia

#78

Post by wakawaka28 »

ChadNauseam wrote: post #69
neumann wrote: post #32

This is a really fun well-written and on point set of articles. Thank you for sharing. I feel like at this point there isn't anybody defending stablecoins who isn't using them primarily speculative investment/trading. There has yet to be a usecase for distributed ledger that isn't solved better by a centralised ledger other than niche counter-culture solutions whose users are typically blinkered to the fact that they…

> There has yet to be a usecase for distributed ledger that isn't solved better by a centralised ledger what about situations where centralized ledgers won't serve you? e.g. someone who wants to buy drugs, or sex workers want to get paid. And you mention "niche counter-culture solutions" but I don't think it's so niche - in 2002, the government of Argentina stole 2/3rds of everyone's savings by forcibly converting th…

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 anonymity.

Do cryptocurrencies provide value to people living in third-rate hellhole countries? Perhaps, because they are connected to the outside world. Ideally you could just have a foreign bank account that your country cannot touch. If the big governments gang up on crypto exchanges, then crypto will be worthless. The only reason they don't gang up on the exchanges seems to be that they (the people in government) use crypto for nefarious activities and money laundering.

The technological innovations of cryptocurrencies make for good thought experiments or puzzles, but serve as a distraction from their inevitable uselessness.

Re: Fintech dystopia

#79

Post by _9ptr »

seanhunter wrote: post #73
jcranmer wrote: post #57

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 hasn't been true for, uh, centuries. It's like literally the entire point of banking, to allow financial transactions to take place without having to physically haul around collateral anywhere. (And if you want a…

Yes and for people who think “centuries” is an exaggeration, the knights templar gained their power and wealth in the middle ages specifically because people could use their promissory notes to exchange for cash so that they didn’t have to physically transport valuables around between Europe and the middle East during the time of the crusades. They allowed people to deposit cash at temple church in London and withdra…

knights templar mentioned in a thread about fintechs and banking. Nice.

Re: Fintech dystopia

#80

Post by _9ptr »

willprice89 wrote: post #3

> people are either still too afraid of looking like they don’t understand, still too deferential to Silicon Valley’s supposed technological expertise, or still too busy doing other things, to voice any skepticism about blockchain-based solutions I'm not afraid of looking like I don't understand - I simply don't understand. I've tried reading a few "yellow papers" for crypto projects and they are so abstract and full…

To be fair, a lot of people don't understand the old money system either
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