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Comment by wdewind | Hacker News Reader

Ok educate me, because I really don't know (my grandmothers both lived in the US): what's wrong with Western Union or PayPal for this purpose?

In many ways this simply moves the problem (overall complication) from a private sector solution much closer to a government solution because it means exchanging bitcoin for real currency will be intensely regulated and have its own fees associated with it.

And maybe someday bitcoin will be worth some monetary value other than the currencies you can exchange it for, but we are not near that.

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Sending $100 to Grandma via Western Union? Be prepared to spend $15-$20 for the privilege.

Or if you want to go the bank route, be prepared to drop $12-$30 for an international wire (depending on your bank). Oh, and she might have to pay a $15-$30 receiving fee for an incoming international wire, depending on her country and bank.

At first, Paypal seems a little better -- only about $4.50 that you have to pay from your end. But Grandma still has to pay $2.50, and god help her if she needs any help from customer service. And then she still has to withdraw money to her bank account, since most international banks still charge up to $5-$10 for this. So in toto, Paypal might actually the two of you combined about the same amount as Western Union.

what's wrong with Western Union?

Speaking from experience: Western Union is awful. Absolutely horrible. They basically stole $50 from me after their representative typo'd a number and then didn't have the authority to fix it, and then I was asked to prove my transaction by faxing them a receipt which I hadn't kept, therefore losing my $50. Avoid them at all costs.

I am having difficulty picturing this situation.

The form you filled out when you sent the money had carbon copies, which are retained. If data from the form was mis-typed later, they should be able to check their copy, or you might be able to retrieve a copy from the outlet or receiver or something.

I assure you that no-one in WU is trying to steal $50 from you. Mistakes happen, but there is a paper trail, so if you really care, escalate. They operate under the supervision of your country's financial regulator, whom they are deathly afraid of, and are hardly going to risk their banking license pilfering fifty bucks.

The $50 was not worth spending literally hours on the phone with them trying to get the issue resolved. The point is that bitcoin has real value as a painless money transfer mechanism.

>Speaking from experience: Western Union is awful. Absolutely horrible. They basically stole $50 from me > Avoid them at all costs.

The point is that you wrote a very damning indictment of a company, accusing them of theft, and I pointed out they could probably fix your issue if you actually cared, even without the receipt. You then admitted you couldn't be bothered going through the process.

So what you wrote was basically a load of crap. But hey, bitcoin!

I was so goddamn pissed off that the phone rep, who could barely speak English, had typo'd my number, which I had been very, very careful to say slowly, and to repeat back to him twice, and then be asked to prove myself by faxing a physical piece of paper in order to get my money back, after a total time investment of > 3 hours, after taking into account driving to the store, waiting on hold, etc, that my mindset was very much "fuck this shit." So whatever you say, man. I didn't accuse them of theft. I accused them of being so excruciatingly awful that recovering the $50 was not worth spending more hours of my life dealing with phone reps who could not understand what I was saying.

Fair enough. That does sound pretty annoying, I'd probably be pissed off myself! Anyway, your later comments put your original comment into better perspective, so thanks for replying.

Ah, sorry I wasn't very clear. =)

I probably missed something obvious here. But what happens if you mistype a bitcoin address (or worse : someone intercepts your mail and gives a different address).

Well, one potential advantage: Bitcoin removes consumer protection, which allows an exchange to operate at much lower rates. Part of PayPal's difficulty as a business is dealing with the constant amount of fraud. With BTC, the consumer bears the problems.

However, the remittance industry makes an obscene amount of money mainly because it's about marketing services in a retail place to unsophisticated consumers. Once you start trying to compete with retail stores, and comply with regulations, it won't be as competitive.

I'm replying to you but this is meant for both of the current replies, genuinely curious:

What makes you guys think that businesses wont be built around simplifying and derisking BTC transactions? And wont this businesses have fees? Grandma certainly does not know how to use bitcoin.

Why aren't more companies competing with WU? Lots of regulations and a massive amount of retail outreach needed. Plus you need secured locations managing cash in the middle of nowhere.

I looked into doing a remittance business a bit over 10 years ago. By far the biggest problems are not technological, it's the simple logistics of taking cash around the world, and dropping cash off around the world. Bitcoin doesn't really solve anything.

@jnbiche, do you think that most "grandmas" have the ability to securely manage a bitcoin wallet? Based on all the reports of people losing bitcoins, and difficulty with redeeming from places like Mt.Gox in a timely manner, it appears easier to herd cats than to keep bitcoins both liquid and secure. I bet most grandmas would gladly pay the $20 service fee that you cited than to be subject to these risks.

Online wallets like coinbase solve this problem fairly well. Having to send money via addresses is no different than CC numbers.

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