How are people using stolen cards? Do your banks not have 2 factor enabled? Using the card not present should require a second factor, Visa Secure type of thing and in person should require your pin for non-frivolous amounts.
In the late '90s when it happened to me, this wasn't even invented yet. In the US today, 2nd-factor is not widely used at all. Not once I have I been challenged by a 2nd-factor, and if I were to be, I'd have no idea what to do with it.
If you were purchasing online then it will tell you to refer to your banking app. If it's in perso , them asking for a pin is pretty straightforward.
So who is pushing back against this? The networks already have it in place everywhere else, and since it's part of the transaction process there isn't a lot for stores or websites to do.
How are people using stolen cards? Do your banks not have 2 factor enabled? Using the card not present should require a second factor, Visa Secure type of thing and in person should require your pin for non-frivolous amounts.
In the US, entering a PIN at the terminal is only prompted for debit cards, not credit, and even then you can usually opt to run the debit card as if it were a credit card and just scribble a fake signature.
But that's a low hurdle to resolve.
The Fed should be able to phase in requirements. They've had decades so far.
Hey there - I'm the author of the essay, happy to weigh in. First, your initial reaction makes sense, and we spent many years (and as noted in the piece, millions of dollars) creating a structure that stayed within the bounds of every reg. That's why we didn't have many competitors. To address your points: 1. The ownership of funds is mapped pro-rata to every user's contribution. If three people contribute $10, $10 a…
Thanks for the very in depth reply! That was a very interesting read, especially how you managed beneficial ownership. It does sound like hard work, and expensive. I guess I'm convinced it's possible, but it does sound like it would be hard to make it profitable. Was the business model mainly going to be fee-based?
I've been thinking about writing some sort of white paper on this, because a lot of what we did was relatively unknown and may benefit the larger financial community. "I guess I'm convinced it's possible" is a great first step! I'll take it!
We had four revenue streams (interchange, instant send, credit card loads, and float on deposits) but IMO to really make this work it needs to have a subscription fee as well. That's a whole OTHER controversial topic in payments, but outside the scope of this discussion thread :)
> Every dollar a startup can raise is a gift. For a time I lost sight of this, and I won’t make that mistake again. This seems like too general of advice. If you are profitable without raising, that in itself is a gift. Why take on debt if you don't need to? This might apply to fast-growth ventures that need to outpace competition to have a chance at existing, but not every company is structured like this or is in a…
In addition, if I’m reading the article correctly, the reason why it would have been better to raise money when the projections looked amazing is that they didn’t pan out, and to expect them to be accurate was greedy? I’ve been a founder, so I know that raising money is all about telling a story about the future, and the time to raise is when your graph supports that story, or before you have a graph. If a week later…
Author here.
Every week was better than the last, and I didn't expect all the bank/third-party stuff to get SO bad. It felt manageable in October 2021, but for most of H1 2022, the period of our best growth, it got a lot worse.
The greedy part was waiting for a "perfect" time to raise.
I think this may be obvious, but no such thing exists (as you probably know).
You can't really use lightning/Ethereum without using an exchange (a big middleman) to convert your fiat to BTC/ETH, because doing it without KYC etc. is money laundering. I don't really think this is incumbents lobbying, I think it's law enforcement saying, "the way we track organized crime is through money, so you can't do this". Crypto advocates know this, because a big selling point they always bring up is "spend…
There are many occasions where there are completely legal reasons you need or want to transfer money that your government nevertheless does not want you to. If you are innocent, but accused of a crime, paying a defense attorney is high on that list. The government attorneys would much prefer you not be able to do that. Donating money to legal organizations that threaten the status quo is another case; you may remembe…
Oh hey, I'm not arguing for less privacy in payments. GP was saying "tell me about how I get some cryptocurrency in a practical way without big middlemen" and there isn't one because of how states define crime and money laundering. I do think it's kind of a tricky problem, but I'm not really defending the regime here nor am I saying that it's actually important to fund things like Wikileaks (which, to disclaim my bias here, I'm not a fan of). I'm sympathetic to the idea that commerce is a basic human right, but I think it very quickly runs into "can I buy black market goods/services" (which are basically like, drugs, guns, human trafficking, violence-for-hire) and almost everyone says "no". I don't see how crypto gets us closer to "you can fund Wikileaks" while not moving us closer to "you can buy a human slave". I think for that we have to look to democratic action to change the laws.
There are many occasions where there are completely legal reasons you need or want to transfer money that your government nevertheless does not want you to. If you are innocent, but accused of a crime, paying a defense attorney is high on that list. The government attorneys would much prefer you not be able to do that. Donating money to legal organizations that threaten the status quo is another case; you may remembe…
Oh hey, I'm not arguing for less privacy in payments. GP was saying "tell me about how I get some cryptocurrency in a practical way without big middlemen" and there isn't one because of how states define crime and money laundering. I do think it's kind of a tricky problem, but I'm not really defending the regime here nor am I saying that it's actually important to fund things like Wikileaks (which, to disclaim my bia…