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Comment by framecowbird | Hacker News Reader

> Use case: the key advantage for bitcoin is that it does away with all bureaucracy, all transaction fees, and perhaps foremost, all transaction delays and gatekeepers in the financial system.

Can anybody comment on the state of this today, right now?

Personally it seems like bitcoin would involve _more_ bureaucracy and delays for me than using the regular banking system. However I'm sure I'm not representative.

Are there other situations where bitcoin does, right now, reduce bureaucratic overhead?

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Buying drugs online.

Sending money to venezuela.

Keeping millions of dollars untouched by intermediaries by memorizing a secret phrase and deleting all other records.

Not just Venezuela, it's being utilized for money transfers among some African countries where the banking system doesn't support it well.

Bitcoin eliminates card fraud. Once a seller has received the payment and had it confirmed, which takes approximately 1 hour, there is no way it can be reversed. In the current banking system, transactions can be reversed at any time - typically up to 6 months, but there's no definite finality. Anyone who has sold goods online has probably experienced fraud at some point, and has had to price their goods accordingly to account for potential losses.

Of course, seller fraud is still possible - the complete opposite of how PayPal works, where the buyer is always right. Seller fraud is mostly preventable with reputation systems. A seller accumulates more feedback than a buyer, but it requires the consumer take responsibility in checking who they're buying from. (People being responsible for their own purchases, imagine that?)

>(People being responsible for their own purchases, imagine that?)

Why would you ever want to defend fraud? There is no justification for fraud on either side. Especially when first parties like Amazon stand to profit off of it and therefore do nothing to stop it.

I'm not defending fraud, I'm attacking credit card fraud and the terrible assumption that sellers must pay for bad policies of the banks or escrows involved in the transactions - policies which assume that people are children and are incapable of being responsible for the security of their own money.

I'm going to ignore the bank bureaucracy that isn't involved in transactions, currency flow, liquidity, fraud prevention, etc.

Bank transactions (in the US at least) take 2-5 days to clear because of insufficient bureaucracy. The banks are understaffed and slow to develop new, more efficient tech. They close on weekends and holidays. Increasing bank bureaucracy would fix a lot of the current problems.

Bitcoin has more bureaucracy than banks in the form of miners (1M+). They never go to sleep and the transactions never slow down.

Reducing "bureaucratic overhead" is a non-goal.

The issue with banks is regulatory capture that's prevented policy/laws that require they're a certain efficiency. Wires aren't instant and take days solely because the banks want to make interest on the money while they are holding it. Law can change this.

In an hypothetical world where Bitcoin is adopted and used by all, this would probably be the case. In reality, most people are in Bitcoin to make more FIAT currency, waiting for that big bullrun in order to cashout at some multiple of what they bought. In that case, instead of banks you have crypto exchanges, which are pretty much just as bad or worse as banks imho.

This is interesting. I always thought crypto exchange <==> bitcoin, and so you still have these centralized actors in the system and it isn't any better than regular banks. But you're saying that if the whole world was using Bitcoin you wouldn't need crypo exchanges and everything would be decentralised, right?

Yes, pretty much. Exchanges are needed now to buy or sell Bitcoin with regular money. If everything was Bitcoin there would be no such need. It will never happen though imho.

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