Hacker News Reader

Comment by vladgur | Hacker News Reader

I was able to send funds from US directly to a bank account of my friend in Ukraine near instantly for low single digit percent and I could do the same using western union(to my surprise). All without a fear that my currency will drop 10-20% in a day.

Now about decentralization, I believe that most people hold their transactional crypto funds in a handful of exchanges and thus the dream of decentralized crypto transactions is rarely realized.

But most importantly why does the end user care if the transaction was decentralized or went through a series of transactions through one or more centralized intermediaries.

All people care is have funds that left place A showed up in place B

View on HN

You can do this w/ crypto but pay only a few cents. I can show it to you if you want.

I am extremely skeptical that it will only cost few cents. (I've sent and received BTC in early 2010s)

On ramp and off ramp to fiat will kill you - whether through transaction fees or through slippage.

Let's say I am in US with 10k USD cash and I want a family in Ukraine (let's say somewhere safeish like Lviv) to have that 10k USD in hand.

Crypto is going to be more expensive than Western Union/Transferwise/SEPA/regular bank transfer/courier through friends.

That is the problem with crypto transfers - sure most crypto coins can be transferred cheaply.

However that "cheapness" only works as long as you stay in crypto verse.

I mean there is no way you can get them USD as cash in hand if that's what you mean. Do you mean USD as in a multi-currency bank account like revolut?

Onramp via onjuno, convert to USDC, send to your polygon wallet, convert to jEUR on Jarvis, send jEUR to friends wallet, they offramp jEUR with 0 fees to their IBAN bank account in ukraine via mt.Pelerin.

You only pay the polygon token transfer fees here.

Times have changed since 2010!

i wonder if usdc to jeur is more efficient than usd to eur. it could be- many banks are opaque about their conversion rates.

Could be. Although USDC to JEUR is using chainlink feeds (which is aggregated data), but they do advertise 0 slippage.

Wow, what a use-case.. sending money from the main NATO member to a country that the NATO supports and wants to win the war.

Now do the same thing with sending money to Russia. I just checked WISE. "We temporarily stopped sending money to Russia".

Yeah.. thanks..

Okay, so how much has the Ukraine situation actually resulted in crypto transactions? Enough to justify multi trillion valuations?

Note that Microsoft, Apple, Google, and Amazon all have $1T+ market caps, and before the recent market meltdown had multi-trillion valuations.

Most Americans - particularly those who grew up before globalization - underestimate the scale of global markets. The U.S. is about 4% of the world's population and about 15% of global GDP. Anything that's Internet-based and has truly global appeal will be significantly larger than anything we would've been familiar with pre-globalization. Hell, the product I work on has about 3B users, 10x the population of the United States.

So we should ignore that crypto is being used a fraction of the time as much as financial products that are worth several times less, because global markets are large? Should every product have a 1 trillion plus valuation because global markets are large?

I just never actually see evidence that crypto has taken over global finance or is well on its way to doing so.

The point is that it's not being used a fraction of the time, because you take small fraction of total humans on earth (7B+) and it's a larger number than a large fraction of total humans in the US (320M). There are 100M crypto users in India, for example - that's only about 7%, but 7% of 1.5B is a larger number than 11.8% (market share of JP Morgan Chase, the largest U.S. bank) of 320M. Worldwide, crypto users are about 3% of the total population of most countries - but the U.S. as a whole is only 4% of the global population, so 3% of a global market is the same size as 75% of the U.S. market.

I have a wallet and bought crypto once. Am I a user? By your statistics, yes. Do I even matter? No.

The only thing I used this crypto for is to sell it later (and gain something like 15 euro profit). Am I a user? By your statistics, still yes. Do I even matter? Still no.

Additionally this use case (trade crypto hoping for gains in actual fiat money) is the absolute vast majority of what crypto is used for. Is this replacing traditional finance? Ahahahaha, no. AliPay has a bigger impact on "traditional finance" than all of crypto now or ever.

Outside of your rhetoric, I do think this is a fair point - with bank transfer ultimately you are constrained by the political people in who you can transfer to.

2-4% seems like a bad deal compared to sending usdc, which should be around closer to 0.1-1% after the ukraine exchange takes their usdc to local currency exchange fee. minimal volatility, less fees.

Single digit percent is unacceptable to me. Also, how long did that take? I assume your friend needs a bank account too..

the majority of crypto is being held in non custodial wallets, not exchanges.

a better way to frame your comment: why does the world use Stripe and PayPal when you can just go to your bank and ask them to setup a multi day long wire process from bank A to B for less fees?

People do both, every day, what is your point?

the point is that Stripe achieves some features for certain users that a wire does not. and crypto achieves some features for certain users that Stripe does not.

The 'wire process' is not "multi-day-long", plus a huge number of banks now participate in Zelle, which can be used for instantaneous fund transfers with zero fees. The biggest problem with Zelle is that it looks and feels like a circa-2002 web application.

many wires will be multi days long, encumbered by weekends, holidays, business hours, international checks, and occasional bounces (ask any company their experience with wires for international contractors).

Zelle is between US banks only. some people live outside of the US, surprisingly.

The EU has now mandated fast transfers between banks in the EU.

So, for EU (23 countries) it's not a problem either.

Sending money between banks is both a technical and a regulatory issue (and crypto is discovering why regulations exist at great cost to crypto users). However, "instant money transfer between banks" is not an unsolved issue.

large (> 10K) bank and wire transfers within UK and EU are still in the order of days, not seconds. the last large bank transfer I did took 5 days without any way for me to track this transfer. the same amount I was able to transfer within crypto networks in 30 seconds and the transaction progress and it’s validation status was visible for the entire duration.

the EU and UK banking system is far better than the US but still it is not a global payment processor network and API, hence why the web even in EU and UK relies on Stripe, visa, Apple Pay and PayPal and their corporate and centralized infrastructures. building an alternative infra that is not based on a single corporate entity is net positive for the world long term

This isn't true for transfers within the UK using Faster payments - upto £250K, near instantaneous.

that limit depends on your bank. for large transfers you will often need to visit your branch in person which can be a multi day process.

and yes UK faster payments system is great but it is not yet the backbone of global payment processing. the world is larger than the UK and as we continue to connect globally online and become more digitally nomadic there will be more need to pay users outside of a UK-to-UK bank system.

If you're the kind of person that regularly wires six digit sums in and out of your personal account, I suspect that one, if not both of the following are true: 1) that you've chosen your banking institution with a view to being expedient in such transfers, and 2) are on a known basis with sufficiently senior branch/bank personnel as to help establish parameters with them on legitimacy of such transfers.

yep. the rich tend to be given access to better banking services than the poor: higher limits, direct line of contact with a bank manager, additional services. when your account reaches a certain wealth threshold the bank will step in to ensure you have a better experience than the poor.

banking is a radically different design philosophy than a protocol where all addresses and transactions are treated equally regardless of wealth, class, and other social factors like race and family connections.

It is self-fulfilling in regards to your point though.

"Oh, that's not a useful system, because there are limits."

"Well, when you get near those limits the bank starts to work with you so those are still not roadblocks."

"Oh, well that's just because they prefer the rich to the poor."

No, you miss the point. At lower amounts, it's a non-issue because you're not hitting limits. At the point where you are hitting limits, it's facilitated to smooth those things. End result is that there should be few issues, regardless of amounts.

the system can and does favour those by social class, connections, race, gender. discrimination in financial and lending services is a well documented issue. the fact that the banking system “imposes limits and barriers until you reach a certain social class” is not a point in favour of the banking system.

most private clients are getting cushy services such as better lending and interest rates, faster payment times, better wealth management services.

but I digress. the banks are useful obviously, despite their flaws, and in the EU and UK the banks tend to be some of the best in the world. this is not to say banks as a whole are useless, but banking systems on average across the globe have many aspects that fall short of our ideals. crypto does not fill all of those, and has plenty of flaws and issues as well, but it does excel in certain areas and at the very least provide a competition that forces us to more closely consider the pitfalls of our typical financial structures.

No idea which bank you used where a payment took 5 days (are you American?). I made a high five figure payment online when buying a property and it was in the destination account the next day.

Crypto bros really have to drop the idea that it's going mainstream by allowing people to transfer money. Crypto is NOT easier or safer for anyone than a faster payment in the EU/UK. Unless you are doing something illegal.

this was with CHAPS.

> was in the destination account the next day

that’s probably CHAPS as well then as FP is within 2 hours. still a a lot slower than crypto’s 30-60 seconds, and extremely opaque process that could have taken additional days without any information to the customer.

but undoubtedly, both CHAPS and FP are very fast and inexpensive, and some of the best systems in the world for interbank transfers. unfortunately it only works from one UK bank to another UK bank, which makes up a small portion of global population. even within UK you will often have need to pay somebody who doesn’t have a UK bank.

You could Zelle your friend in Ukraine? Doubt it.

Reply on news.ycombinator.com