Today I went to one bank to transfer 60k from one account to an account in a different bank. I paid 7.50$ to get a certified check from Bank A. Went to the Bank B near my house to deposit it there. Unfortunately the branch near my house isn't where my account is. They tried faxing a photocopy of my certified check to the other branch but the line was busy. They're going to continue trying until 3pm today when they close. After 2 hours I see the funds are in my account but I'm not allowed to access it because I'm limited to only 2000$ per day. They didn't call me as per instruction once the funds were in my account.
During that same time I transferred 15k$ from one crypto-wallet to another. It took 10 minutes all told.
Sure there are lots of people who are buying crypto because they think they'll make loads of money but a significant portion of us are in it because we dislike the infantilizing ways the current banks hold us hostage.
My first hand experience (2017) is that US banking oferring (from a european guy perspective) is a eyes opening experience.
* There is no instant bank wires (free ones) between major banks. Or at least the same days ones, working reliably through most of banks.
* You get paper checks from your bank :)))))
* Small business (sold a car, got a return from landlord) give you money on checks, also accept only paper checks if you need to pay them on the spot (in the office).
* your bank charges you a monthly fee, to protect you from overdraft (wtf is this on debit account??), he shall block from happening at the begining - we call it "protection racket" in Italy.
* boa/citi and others have websites with design from 2005, not to mention mobile apps..
* you can't send money from bank account to a different
bank to your unsophisticated friend (plumber, maid, or mr sandwich) just knowing his phone.
* when you withdraw money from coinbase to your connected US bank account, you pay 1,5% of face value. WHAT? PERCENTAGE FEE? This is USA banking thing, as the very same coinbase, charges fixed 0.15 EUR fee per no matter how big wire if you're european.
* major us banks got two factor just two years ago in terms of security.
* tap to pay (we call it paypass) is also almost 10 years after europe.
* first chip card in citi was offered to me in 2015 or 2016? Still magnetic (easily copied) card is used in majority of points in the USA
etc..
Some of them are chaning in the last two years, but mostly for sophisticated customers, small banks, and people not being able to use those features between different banks. It will still take a lot of time to catch up with a Kenya from Africa...
I live in Canada but even when I lived in France banks were silly. I remember asking them to close an account and they said "Oh no... once you open an account we never close it."
> you can't send money from bank account to a different bank to your unsophisticated friend (plumber, maid, or mr sandwich) just knowing his phone.
Banks in the USA do not allow deposits into accounts without account holder permission. They won't let you stop by a branch and deposit into a friend's account (to pay them back) without a formal arrangement, so it's easier just to find your unsophisticated friend and give them cash directly. I'm not sure if this is due to a law, or our culture of security theater.
> Banks in the USA do not allow deposits into accounts without account holder permission. They won't let you stop by a branch and deposit into a friend's account (to pay them back) without a formal arrangement
This is not (universally) true. I've had many friends/family deposit checks for me at my local branch when I'm out of town/on vacation/whatever. I've done it myself for other people. I believe the banks in question were Wells Fargo and US Bank.
YMMV based on bank, but there is no regulation preventing this.
I was turned down by both Bank of America and Columbia Bank (local WA State bank), as it violated their security procedures at the time - this was about 10 years ago.
The reasoning presented was a little suspicious - they envisioned someone "forcing" you to unwillingly take a loan (of like $100) by depositing it into your account. Then they would demand their $100 back and use this as leverage to blackmail or otherwise disrupt your life.
But I don't totally disagree. To me, depositing money into another person's bank feels...improper - like performing an oil change on someone else's car, or taking someone else's books back to the library, or walking into your neighbor's unlocked house to lock all the doors. There are very good reasons someone would want these done for them, and also edge cases where these would cause an issue for the other person. It's a moral grey area to me.
>Sure there are lots of people who are buying crypto because they think they'll make loads of money but a significant portion of us are in it because we dislike the infantilizing ways the current banks hold us hostage.
...But if you were beaten and robbed on your way to the bank, that check would be worthless to the thief. If your bank went insolvent, the FDIC would cover your $60k. What happened to depositors when Mt. Gox went belly up? What happens when that same thief hacks your wallet instead? There are many positives to our current banking system which you seem to be dismissing. Namely accountability. Perhaps once these things are well regulated and backed by legitimate business it will see mainstream use. But crypto is literally nothing but a speculative game and means for laundering money at the moment.
Also I agree banks in the US really need to modernise their procedures, I don’t really see how this is an argument for cryptocurrncy.
Here in Europe I can make a payment to any other EUR bank account in Europe, for free and it’ll usually arrive the same or next day. All I need is the recipients bank account number, and to enter that and the amount on my online banking - I don’t need to go and see anyone or fax anything over.
Recently a new initiative was launched where (between participating banks) you can transfer up to €15,000 in a maximum of 10 seconds:
I had a similar experience recently. I finished a contract job and received a check too large to deposit over my banks mobile phone app and unfortunately my bank doesn't have any local branches. I have a backup bank to do local deposits, but the transfer took 5 days to fully clear at my primary bank.
I had to call my bank and explain that I needed a mobile deposit limit increase which took less than an hour to happen. Prior to that conversation I was cussing a lot though.
If we're talking about bitcoin I think ~$15 and ~4 hours average right now which isn't much better.
If we're talking about other currencies, you have a good point. I think lumen (XLM) is the best right now, ~$0.0000015 fee, ~3 second average right now
Not that much more actually. Given he paid the normal fee rate. I bet the additional dollars was cheaper than physically taking time off to go to a bank which is only open during (your) working hours.
>Sure there are lots of people who are buying crypto because they think they'll make loads of money but a significant portion of us are in it because we dislike the infantilizing ways the current banks hold us hostage.
Sure, but if someone scoops your crypto coins, or you leave them in an exchange that's hacked, you basically have no way to get it back.
This is trading a serious amount of security granted to us by world governments for convenience. It also increases your cognitive load of handling your crypto safely.
That bank sounds terrible, and it can vary from branch-to-branch which is frustrating.
I get that this doesn't happen every day but I paid for a certified check. Their method for certifying it involved 5 people and will take a few days before it clears.
People do certified checks whenever they buy a house, a car or transfer significant money from one institution to another.
And don't get me started on sending money to family members overseas!
That's an absurdly specific grievance that won't effect 99.9% of people in any given year, and it certainly doesn't answer why Bitcoin isn't in a bubble.
It is definitely a speculative bubble. I think we are in a similar position as 1998. The technologists can see that [the Internet]/[cryptocurrencies] are very interesting technologies, with the potential to change the world. But retail investors are pouring in, without any understanding of the tech, and inflating both good and bad [companies]/[coins] in a pure speculative frenzy.
If I had to bet, there is still lots of upwards runway left, but at some point, it will come crashing down, the bad [companies][coins] will be worthless, and out of the ashes will rise a more sensible market with some of these [companies][coins] truly changing the world.
There will be a lot of blood on the floor though. The rise of Bitcoin as a speculative asset (and its inevitable crash) will do some damage for sure.
I'm bullish on blockchain technologies over the next decade or two, but we're gonna have to clean up for awhile.
My hope is that blockchain enthusiasts are taking their profits and using them to invest in building something better.
(There's also a lot to be said here about the hucksterism, shilling, get-rich-quick schemes, and an almost-fanatical belief in the power of a pure free market inherent in the BTC community from the beginning, but that's best left to another post)
I totally agree. I'm confident a crypto coin crash is coming to eclipse any we've had before. The combination of volume, transactions/second limits, and weak exchange infrastructure; when people want to get out things are going to get ugly.
Also agree. It seems many people are convinced that others will just keep holding forever. Eventually there's less money flowing in and people will realize they aren't getting rich. When people aren't making more money they will start selling.
Worse, the people buying in now aren't true believers. They are "investing" because they think it is easy money. These folks represent a larger percentage of the market cap and are also least likely to have confidence in bitcoin for it's utility. They also stand to lose the most because their buy in point was so much higher. (people who bought in at say $1000, are just losing profits)
The cult-like “hodl” culture in the Bitcoin community exacerbating the already limited supply of Bitcoins (if it were a stock, it would be a “low-float” stock, which results in increased vol) has served as the perfect breeding ground for a bubble.
As Bitcoin becomes extremely mainstream, those who hodl Bitcoin with religious fervor are increasingly becoming a smaller minority. Eventually it’ll reach critical mass and there will be enough disloyal Bitcoin ownership to cause a panic at the first significant sign of selling.
Whenever someone says they're sure of a crash, I assume their true feeling is isn't confidence of a crash but frustration at having missed out. Have you shorted Bitcoin? That would help you to profit from your belief.
Sure I could short Bitcoin, but it cost me nothing to speculate about a crash. I also make the assumption when I see the FOMO argument that the person has a stake in Bitcoin/Crypto Currency. Perhaps both of our assumptions are wrong?
Once the bubble burst then no one argues that they were in a bubble.
I read somewhere that people are leveraging huge sums of money on crypto which may explain how it is going up by so much and so fast. If for whatever reason we start to see even a small downward trend then these people will be forced to sell their position and the whole thing will come tumbling down.
I believe BTC is here to stay, due to it being some form of "backing" currency for all other crypto currencies. I guess one could claim the same for ETH, since it's used for many ICOs.
But apart from that I am not sure what the future of ETH or LTC will be. To me it seems some adaptations of ETH have a much clearer use-case and therefore are likely to raise a lot in value in the future. One of the ETH based coins that I really believe in is OmiseGo[0] (OMG) which will bring banking capabilities to many people that currently don't have a bank account.
They're not a MLM because there isn't the "pyramid" aspect. If I buy bitcoin at $10 and sell it to you at $100, then I don't get a percent of your sales going forward or anything like that. It's a plain old bubble.
The part I’ve never liked is that Satoshi Nakamoto only mined for 10 days and got ~1M bitcoins. Today, if I mine for 10 days I’ll probably get 0.001 bitcoins. Even if you adjust for increased computing power, why are my hash calculations valued a billion times less than his? Why can’t I get 1M bitcoins for a similar effort? From a market value standpoint, his computing effort is worth $18B. If, today, I put the same computing effort in as he did, I only get enough for a nice lunch.
I understand the technical reasons why due to the 21M bitcoin limit, hashrate difficulty increasing, etc. It just seems like a rigged system with the people “on top” getting huge rewards for very little work whereas the people lower down who do many orders of magnitude more work are getting very little reward. From that perspective, it has the scent of MLM, if you will.
Wikipedia says he mined “at genesis and for 10 days afterwards”. Regardless of 10 or 139 (perhaps “genesis” includes several years of development), it doesn’t change the point.
Creation of bitcoin aside, what risk is involved in an early adopter letting their computer crunch numbers for a few weeks? If you were the third person ever to mine bitcoin, about the only risk I can think of is a bit of time & effort plus a slightly higher electric bill.
The risk of being starting the whole thing. If you think starting your own coin is easy, go ahead and start mining, the hard part is convincing others to adopt your coin.
That's not what makes MLM a "pyramid". Residuals are part of lots of legitimate business. What makes most MLM a pyramid scheme is the fact that growth is predicated on bringing new members into the scheme, rather than existing members growing their business.
They key thing about pyramids/MLM is that the growth is based entirely on getting more investors i.e. people who are putting money in with the intention of getting money out later (this also included MLM sellers who have to buy product upfront). Whereas a non-pyramid grows because it has more non-investor users, or some other source of revenue from people who don't plan to take that money out later.
I'd say it's more like a ponzi because the market volume is so far from accurate due to the chameleon hoardsters. They will dumptruck eventually, so anything gleaned from looking at current market stats is really just a facade. Wait till the whales start selling...And no disrespect to Satoshi who is most likely Finney but if he or his children ever decide to dump their share that most appraisers tend to consider "missing for good," you can bet the price will take a monstrous hit. Thats why I consider BTC a ponzi. The current dynamics are an ill reflection of the actual level of buyers and sellers. And there is no real way to assess number of hoarders due to not knowing how many BTC are lost or simply forgot about.
The bubble part of it is not their meteoric rise, it's that they can easily be replaced by the next best coin. There is no inherent reason why Bitcoin should be more popular than Litecoin as a store of value, except for the fact that it currently is.
There will be many hundreds of coins flooding the market. There is no such equivalent in the real (offline) world. You have gold, silver, platinum, etc. - but that's about it. No one is inventing/digging up new types of metals.
Does one cryptocurrency increase 20x in a month? Then yes, it's a bubble, and it will likely crash pretty hard in another month or two (but probably not as much as it rose).
Does it increase 20x in a few years? Not necessarily a bubble because its value may simply be related to its adoption and potential.
The thing about cryptocurrencies is they have rather limited supply once they are launched on the market. So if their userbase/number of adopters increases by 10x overnight, and most of them intend to keep those coins, then it doesn't really qualify as a bubble, even if the value explodes.
I bought BTC to use as currency for transactions not as an investment. It should be used for that purpose. MLM only has one purpose - to recruit others into it. I don't ask other people to buy BTC so I can make a profit. MLM usually has a pyramid commission structure.
If you don't mind me asking, what types of transactions do you currently use it for? Based on the current technology and fees, it is quite expensive to transact, and really doesn't make sense for me.
That said, I can see a future for it if something like lightning network ever gets released (and actually works).
Currently it doesn't make sense to use it for transactions with it changing wildly from one hour to the next which is a shame. I will be glad when it settles down. However I have in the past used it for online transactions and used it in small bars/restaurants and used BTC ATMs
Bitcoin has any fee you want per transaction, from 0 to all the bitcoin you control. The more you pay in fees, the more likely it is to be included on the blockchain sooner.
Yes, people may be able to live their life without going back to USD currency, so their will be no devaluation of a crypo X as long as people trust it (as gold). When a cryto X is not trusted anymore people are going to stop using it to go back to USD or another crypto thus devaluating the cryto X in respect to the USD.
A big advantage of cryptocurrencies (I think) is that there is no regulation (no central bank injecting billions), but it is also its Achilles's heel because it can't be used ha s a commodity currency because it miss the stability of a currency backed by a central bank.
So like, there are a lot of problems with cryptocurrencies obviously, but they don't really resemble mlm in any particular way even if you consider them to be a scam?
In multilevel marketing, people are being sold downstream profits directly from people they sign up. If you sign up another person you take a cut of their revenue. If you sign up enough people and they sign up enough people you stand to gain a lot of money with very little work.
When it falls apart, assuming you're not deep enough in that you're indited yourself, you keep that profit. It's the people at the tail end who lose because the only way to really profit is to sign people up.
On the other hand when you sell someone on bitcoin you aren't taking a cut of their 'revenue'. If you're invested in bitcoin you're as in the hock for a crash as they are.
It's an asset, though a somewhat different one to traditional assets. As such it's subject to the same kinds of asset bubbles as any other asset (ie. gold is not as liquid as fiat, nor is it really used to buy things). But it's not the same kind of thing as MLM.
You should think about which fiat your likening it too. Its more liquid that certain fiat (Venezuela) and can definitely be used to buy things.
It's not being used to buy things because its a deflationary currency which along with an adoption curve means it's more advantageous to sit on it.
The adoption is definitely increasing the value of it, its a more liquid gold to me, but like any other currency or asset the value is derived from the trust and value that people put in it.
It is a bubble. In fact I'd venture so far as to say it's a Ponzi scheme. But in any successful Ponzi scheme, the early investors actually get a huge payout. I don't regret investing in it one bit.
Just think about crypto-backed real-world assets and compare that against "market capitalization" (which is ridiculous to even call it that in my view). This is why ICOs are nothing more than buying into pump-and-dump stocks or at best microcap biotechs.
It does have some similarities to an MLM scheme. Mainly the part where a bunch of obnoxious people are doing everything they can to con others to buy in and make them money.
Clearly, are shown by the site here, these aren't nearly as liquid as fiat currencies, nor are they really used to purchase anything.
So... What is it?
EDIT: upon thinking about it, MLM wasn't the term I meant.