Digital currencies are fundamentally changing the way we think about money and banking. The rapid rise of cryptocurrencies like Bitcoin, along with the
What it means for traditional banking is pretty much nothing, because the majority of the population don’t in fact think about currency any differently than they did in the pre-Internet era (and the only way they’ve changed how they think about banking is that they expect greater convenience and remote access). Crypto is an unsecured investment vehicle, not a currency, because the set of goods and services it can be directly, legally exchanged for is small.
Crypto is an unsecured investment vehicle, not a currency, because the set of goods and services it can be directly, legally exchanged for is small.
And it makes me sad. I really want cryptocurrencies to be useful for actual transactions, because it solves a lot of annoying problems, such as:
international cash transfers - e.g. send a cash gift to a friend in another country
person-to-person ad-hoc transactions - cash works, but cryptocurrencies can protect personal banking info for cashless transactions
avoids network fees - credit/debit card companies charge fees to merchants, and businesses pass that on to customers; cryptocurrencies sidestep that entire system
But yes, the primary use right now of cryptocurrencies is speculation, which is incredibly annoying because that causes fluctuations, which discourages its use as a currency.
Crypto doesn’t avoid network fees. The fees aren’t quite as arbitrary and are shared with a broader pool of those providing the network, but the fees are still there providing the incentive for the network transactions to be processed.
Sure, and they absolutely should exist, but there’s no reason to have network fees be relative to the size of the transaction, because processing $1k vs $1 is the same amount of work.
It did kindle. Major companies started accepting it. Then the blocksize wars happened, and the 1mb forever people won through massive censorship and deceit. Then companies stopped accepting it directly as a result of the problems a 1mb limit causes. Now it might never happen again for BTC. The war and the signs leading up to it though spawned other cryptocurrencies, so those might succeed where Bitcoin has failed. We’re still suffering from the damage caused though as companies that stopped accepting it are now skeptical of accepting anything else again.
1mb limit -> transaction backlog grows -> higher fees to get in next block -> transactions get delayed from fee volatility and having used the wrong fee which moments ago was the right fee -> now the heavily delayed transaction is the wrong amount due to price volatility and steam and the customer are fucked.
It kindled, and was in turn murdered as it had been intended to be used.
Also businesses are not going to sign contracts on alternative currencies. Like find me an insurance company that accepts bitcoin and pays the claims* in bitcoin. And the biggest share of bank businesses is b2b banking.
* maybe they have some bitcoin if they do cybersec insurance to pay for ransomware.
What it means for traditional banking is pretty much nothing, because the majority of the population don’t in fact think about currency any differently than they did in the pre-Internet era (and the only way they’ve changed how they think about banking is that they expect greater convenience and remote access). Crypto is an unsecured investment vehicle, not a currency, because the set of goods and services it can be directly, legally exchanged for is small.
And it makes me sad. I really want cryptocurrencies to be useful for actual transactions, because it solves a lot of annoying problems, such as:
But yes, the primary use right now of cryptocurrencies is speculation, which is incredibly annoying because that causes fluctuations, which discourages its use as a currency.
Crypto doesn’t avoid network fees. The fees aren’t quite as arbitrary and are shared with a broader pool of those providing the network, but the fees are still there providing the incentive for the network transactions to be processed.
Sure, and they absolutely should exist, but there’s no reason to have network fees be relative to the size of the transaction, because processing $1k vs $1 is the same amount of work.
In the early days, we early adopters tried to bring it into circulation. I bought a few beers with it at the bar once. Sadly, it never kindled.
I’m still holding out hope. We’ll see what happens.
It did kindle. Major companies started accepting it. Then the blocksize wars happened, and the 1mb forever people won through massive censorship and deceit. Then companies stopped accepting it directly as a result of the problems a 1mb limit causes. Now it might never happen again for BTC. The war and the signs leading up to it though spawned other cryptocurrencies, so those might succeed where Bitcoin has failed. We’re still suffering from the damage caused though as companies that stopped accepting it are now skeptical of accepting anything else again.
Edit: This is steams post on the matter - https://steamcommunity.com/games/593110/announcements/detail/1464096684955433613
1mb limit -> transaction backlog grows -> higher fees to get in next block -> transactions get delayed from fee volatility and having used the wrong fee which moments ago was the right fee -> now the heavily delayed transaction is the wrong amount due to price volatility and steam and the customer are fucked.
It kindled, and was in turn murdered as it had been intended to be used.
Also businesses are not going to sign contracts on alternative currencies. Like find me an insurance company that accepts bitcoin and pays the claims* in bitcoin. And the biggest share of bank businesses is b2b banking.
* maybe they have some bitcoin if they do cybersec insurance to pay for ransomware.