Bitcoins

xp currency exchange costs perhaps yes, if the govt decides to regulate it (which yeah they probably should), but perhaps not the cost of going through international settlement networks, which, to be honest, I have no idea what the costs are and I don't think any of us do.

What mandates that a currency exchange operator has to go through an international settlement network tho?

pretty questionable to make a cycling joke when the high diving joke was so crucial to the coneheads lols imo xpost

I am no expert on this, but I thought you needed a way to actually transfer the money from entity A in the US to entity B in hong kong or wherever. I don't think you can just have the guy at one office call the other office and say "We're straight now, Moneyz X-Change now has $1000 less on its books, and Moneyz X-Change Hong Kong now has $1000 more." I mean otherwise you could just make money appear out of thin air.

xposts

I'm guessing that most of the costs associated with a wire transfer are in the origination and termination rather than in the actual transfer. So unless you can go an buy a loaf of bread with bitcoin you're still stuck with those and given that these costs are somewhat uniform irrespective of the amount transferred small transfers are going to be penalised proportionately.

that's not to say that BTC can't carve out a niche and challenge incumbent platforms. There are already mechanisms outside of traditional banks, the Hawala system for one.

At the moment I feel like someone has the opportunity to use bit coin as the basis for a lyca mobile or corner shop phone card of money transfer systems.

Hmm isn't the simplest way just to have Entity A hold both HKD and USD and make appropriate additions/deductions as necessary

Not an expert in this either, I guess you're saying the international settlement network works as some sort of verifier? xp

Are you talking about a single currency-exchange shop or an international remitter? A storefront exchange can just keep USD and HKD and keep track via bookkeeping. But if you're talking about actually sending money overseas, that's different. Yes, it's basically a verifier, is my understanding.

And remember even the same company in two different countries generally involves different entities.

I'm sort of thinking of an online only shop that you'd keep bank account info from your HK bank and your US bank in, and you'd do the whole thing online - a virtual storefront exchange ; )

I suppose that you'd want some sort of guarantee that the place would be relatively liquid in all the currencies it trades in

xp Yeah, not sure if not having a physical presence in a territory would still require separate entities

But anyway seems to me that the only advantage of bitcoin is that bitcoin, as an intermediate holding unit, is a self-verifier so you can bypass the international settlement network

But you'd be opening yourself up to a bunch of other dangers. Are your accounts insured against theft/fraud, for example

Because ordinary banks and international money transfer services don't have a way to, like, magically make money disappear and reappear halfway around the world.

― signed, J.P. Morgan CEO (Hurting 2), Wednesday, January 22, 2014 8:46 PM (33 minutes ago) Bookmark Flag Post Permalink

yeah just wait until they get computers its gonna change everything

I am no expert on this

― signed, J.P. Morgan CEO (Hurting 2), Wednesday, January 22, 2014 9:02 PM (19 minutes ago) Bookmark Flag Post Permalink

mm

Banks can't just send money via computer directly to each other without a third party involved. There would be no way to verify the credit/debit if they could

Really, just take a few mins and think about that before you try to zing me again.

you really think there are banything more than negligible costs associated with banks moving money around the world

Anyway how many middlemen does bitcoin cut out of the transaction, doesn't seem like enough of a cost-saving to be worth it given its other problems

like there's a lil guy in a room counting the money they have to pay

ill def make super sure to check myself before stepping to the bit god hurting again tho

he has read some blog posts by delusional nerds

xp yes they are called the costs of being a bank

lol oh i thought the costs were associated with third third party verification guy

a random dude with a website can't even get that. It's not just like hiring a "guy" to verify, it's being a part of the international banking system.

Well Hurting's not wrong in that interbank transfers are handled by the

http://en.wikipedia.org/wiki/Automated_Clearing_House

I'm not sure it's supposed to make any money tho

Domestic US interbank transfers, I think

And it's one of several I think

I'm opening up Wikipedia pages as fast as I can

a random dude with a website can't even get that. It's not just like hiring a "guy" to verify, it's being a part of the international banking system.

― signed, J.P. Morgan CEO (Hurting 2), Wednesday, January 22, 2014 9:38 PM (7 seconds ago) Bookmark Flag Post Permalink

so what youre saying now is that its not some transfer fees that prevent the banks from competing with bitcoins ability to move money around for "free" its that banks have too much overhead

Where is the post where I said that it's "some transfer fees" that might make it harder for banks from competing with bitcoin?

Because ordinary banks and international money transfer services don't have a way to, like, magically make money disappear and reappear halfway around the world.

― signed, J.P. Morgan CEO (Hurting 2), Wednesday, January 22, 2014 8:46 PM (33 minutes ago) Bookmark Flag Post Permalink

again, where is the part where I said it was "transfer fees"?

oh sorry you need an example of you using those exact words lol

Bitcoin is tearing us apart

not just saying things that amount to that over and over

it costs money to have the ability to transfer money around the world, you can't just do it because you have "computers"

now you are beginning to see

but the marginal cost of a bank moving a dollar around the world is 0

But you can't do it unless you are a bank, and it costs money to be a bank

well if the only thing you did as a bank was move money around the world you might have a point

if every bank was paypal say

The marginal cost of time warner allowing the internet to work on my home cable is zero too, why does it even cost money?

They just beam the signal over their lines, boom, zero cost.

thats not really true but lets pretend it is, cable is their primary product its how they make their money, the marginal cost of operating an atm is actually non zero but my bank still lets me use it for free, do you think if some crypto currency was threatening banks financial services domination they would have any problem lowering their prices to compete, they would not

this is of course accepting all of bitcoins ridiculous assumptions re regulation and cash in/out

the point is bitcoin doesnt do anything banks cant do

a big international bank could provide a service at a large net loss to compete. that doesn't mean it wants to or is going to.

None of this is to speak of western union, which pretty much does only do this.

it wouldnt be a large net loss is the whole point it would be no loss at all, money transfers arent their main business and the cost is effectively 0

btw banks don't charge you for atms because you are letting them hold your money

yes banks want to handle yr money they want you to open accounts and take out loans deal with them altogether

and some crypto banking network is a threat to that

but the whole argument is stupid in the first place cause if the only thing you have going for you is the ability for individuals transfer cash internationally youre never going to reach the critical mass that something like this needs to work, how is the vietnamese villager going cash out the bitcoins their son sent from germany, if there is some way for them to do it is it really gonna cost less than the 3% paypal charges

and some crypto banking network is a threat to that

― lag∞n, Wednesday, January 22, 2014 10:25 PM Bookmark Flag Post Permalink

I never said anything remotely suggesting bitcoin is a threat to the banking system. I pretty clearly said the opposite. I just think that the built-in anti-doublespending/self-verifying properties of bitcoin may have some potential uses.

basically you need a bank account and a smartphone at least to even use bitcoin, once you have those things you have access to reasonably priced financial services that bitcoin could only ever compete with on price if it became ubiquitous enough that it didnt need to be exchanged for local currency in order to buy things eeeeexcept that will never happen because bitcoin will never be a stable store of value