undefined | Better HN

0 pointsswift5323y ago0 comments

I am not the best person to address everything point by point as I am not putting enough thought into it, but perhaps I could point (heh) you in the right direction.

Sure you could let Visa do this (as they and Mastercard handle most online payments now anyways), and it would probably work as well as Visa/Mastercard work now, but for some people that is not good enough.

1. Differentiate clearing (telling you you now have some money) and settlement (you getting the money you "have"). For Visa and Mastercard the latter takes days or more.

2. Permissionless means that you don't need any entity's permission to transact. Visa and Mastercard definitely require permission, and on occassion don't give it for various legal but "immoral" things like porn, Wikileaks, and who knows what in the future.

3. Borderless is kind of similar to permissionless. As soon as you bring in legacy behemoths like Visa into it, this kind of goes away.

4. With decentralization, fees are determined objectively (you pay to get in, and if there is enough demand, regardless of price, blocks are full). A monopolist would charge as much as they could get away with, sometimes even if that means no transactions are being performed.

---

I would say that with a Visa(like) company, you definitely lose 2, and 4 will probably have some bullshit involved.

0 comments

RC_ITR3y ago

Ok, let me point you in the competing direction:

1. This has nothing to do with cryptocurrency. There is literally nothing about a decentralized trustless architecture that makes this happen. You're falling into the common trap that crypto people fall into where they equate criticisms of the current centralized system with 'possibilities of a decentralized system,' when really what they mean is any hypothetical new system could be better than the current one. All else equal, a centralized system will be faster no matter what (i.e. this is a major reason why servers are centralized) and I agree we should be working on better/faster centralized systems.

2. You definitely need the permission of the miner/validators/whoever to transact [0]. You also need to convince them to put your transactions into the block and there is nothing that compels them to do so other than the same economic incentives that motivate Visa. You are again, criticizing the system now and imagining that a decentralized system is better.

2A. To break down the problem a little more clearly for you - Visa's main service (what it makes money doing) is actually fraud protection, since as you must know bank's can very easily settle between each other over other rails. Visa chooses not to process transactions that are at high risk of fraud/illegal activity, because they have regulatory liability. Miners not having regulatory liability isn't a function of decentralized trustless architecture, it's a function of being new. Either blockchain is similar to a wire transfer (something that porn companies still have full access to) or it's similar to Visa and will face the same problems.

3. I suggest you google the countries where it is illegal to use crypto to buy goods/services (governments plan on keeping currency controls intact after all!). The shear number will astound you!

4. Not sure on the monopolist point there, but again, Visa/Mastercard/Amex compete on swipe fees (look at the Costco example!) so I'm not sure what this decentralized point you're making really is.

[0] https://cryptobriefing.com/solana-blockchain-halted-for-eigh...

j / k navigate · click thread line to collapse