
Circle Emerges From Stealth To Bring Bitcoin To The Masses - gwintrob
http://techcrunch.com/2014/05/15/circle-emerges-from-stealth-to-bring-bitcoin-to-the-masses/
======
aspidistra
Every time I read an headline about "bringing bitcoin to the masses" I'm
reminded of the saying that you can lead a horse to water, but you can't make
it drink.

> "We don’t think consumers should be charged for using their own money."

Where I live (UK), I can't think of anything bitcoin services like Circle
offer that is definitively better than my existing bank setup.

I'm not charged for using my own money. I don't pay a monthly fee for my bank
account. I don't pay anything to send money to other people in the UK, which
covers 98% of all the people I send money to. If I do send money to people in
the UK, it's usually virtually instant, because of Faster Payments. I can
withdraw money from nearly all ATMs in the UK free of charge -- the only
exception are rare independent ones in places like nightclubs and out-of-the-
way convenience stores, and I honestly can't ever remember using one. I can
check my bank balance on my phone -- by app or by SMS. In lots of outlets I
can pay for small value transactions, anything up to £20, just by waving my
bank card.

I understand the banking system in the USA is ... different. (Some would say
behind the times.) But in the UK at least, promoting a bitcoin-based service
based around the concept of better retail banking is a hard sell.

~~~
staunch
The bank you use is in actual control of your money. They let you access your
money on their terms. They reserve the right to revoke access to your money in
many circumstances. You don't get to opt out of having a bank account in
modern society. You get to choose from multiple banks that act almost
identically. All of them record every thing you pay for. All of them store
your data and make it available to thousands of employees and any two-bit
hacker that ever breaches their security.

A massive increase in personal freedom and personal privacy is all it took to
convince me. I doubt it's an American thing, but maybe it's an easier sell
here.

~~~
ZenPro
I am not aware of many " _two-bit hackers_ " compromising bank security.

Bank security systems are designed and administered by people of the same
calibre who design and administer many startups, including crypto-currency
products.

Do you think that an elite _hacker cadre_ exists and those working in
corporate environments suddenly are less effective?

Nonsense.

~~~
jnbiche
>Bank security systems are designed and administered by people of the same
calibre who design and administer many startups, including crypto-currency
products.

Then why is it that I have frequently run across banks requiring a maximum 6-
or 8-character password, and have _never_ run across a startup -- Bitcoin or
not -- with such poor security requirements?

~~~
ZenPro
Which banks specifically secure online data _only_ using a 6 character
password?

Most banks, if not all, have BSI ISO27001 security certification and are
accredited and administered by the pinnacle companies of the security
industry.

For comparison; HN has a multitude of threads listing the outrageous security
practices of many crypto-currency related companies, some beyond start-up.

You seem to think banking security is simply a bunch of guys in suits simply
having a crack with a copy of ZoneAlarm and Kaspersky. Classic _them v us_
ideas with a touch of Dunning-Kruger thrown in.

~~~
pjc50
Yes and no; while the banks have avoided widespread compromise they often have
weird password requirements or ham-fisted attempts to secure user's PCs with
crapware like Trusteer Rapport: [http://www.pcpro.co.uk/realworld/359617/is-
hsbcs-security-so...](http://www.pcpro.co.uk/realworld/359617/is-hsbcs-
security-software-more-trouble-than-its-worth)

For a while Santander's login system redirected my wife's account to a page
with an expired HTTPS certificate.

Then there's fun things like playing tetris or MITM attacks on the Chip and
Pin terminals:
[http://www.saardrimer.com/sd410/pres/showandtell08.pdf](http://www.saardrimer.com/sd410/pres/showandtell08.pdf)

(Obviously mtgox is worse, but my point is that banks tend to a proceduralist
cargo-culty approach to security).

~~~
ZenPro
That is a nice link to the chip and pin compromise although APACS did cover it

>> _We believe that the risk remains very low. [This attack] is signiﬁcantly
difﬁcult to industrialise to the numbers of devices that would gain criminals
the return they would expect and, therefore, not economically viable to
criminals._

I am not saying banks are perfect, no organisation is, but they are certainly
not just old men in conference rooms wondering what the little 1's and 0's
mean. Some bank security consultants are the best penetration testers in the
world.

------
JoshTriplett
Reading the entire article, their business model is not at all obvious. They
claim to not charge fees; they can't make money on their customers' money;
where _do_ they see a business opportunity here? Conversion fees would be the
obvious, if the lack of fees just referred to transmit/receive, but that
doesn't seem true based on the article.

~~~
nwh
Keep in mind that if they're paying the network fees for the user they also
lose ~0.0001BTC or more per transaction it's users make. They've got to make
that up from somewhere.

~~~
icebraining
The fee was reduced to 0.00001 BTC (1/10th) recently:
[https://github.com/bitcoin/bitcoin/pull/3305](https://github.com/bitcoin/bitcoin/pull/3305)

EDIT: It seems I misunderstood the change. M4v3R is right.

~~~
M4v3R
That change only reduces RELAY fee, which means that nodes will now by default
relay transactions with such fees to other nodes. The default minimal miner
fee, which is what miners require to include transactions in blocks is
unchanged.

~~~
icebraining
Yeah, it seems I misunderstood the change.

------
thinkcomp
Circle's demo video at [https://www.circle.com/2014/05/16/circle-
update/](https://www.circle.com/2014/05/16/circle-update/) is perhaps the only
I've seen best watched with a calculator.

$10.00 + $0.01 that comes out of nowhere + $200.00 - $23.65 = Uhhh... $187.27?
Plus or minus 91 cents? What?

Yes the Bitcoin exchange rate fluctuates a lot, but their ledger does not seem
to reflect that. That's problem number 1.

Problem number 2 is Bitcoin itself.

Problem number 3 is that the comments are about "insurance" are completely
disingenuous. What insurance? Circle is not FDIC or NCUA insured and the
company has an obligation to make that clear. Allaire and his investors should
know better.

~~~
oska
While Jeremy is talking in terms of dollars in the presentation, the software
is actually keeping balances in terms of bitcoins. You can see on the screen
below the two green add/withdraw funds buttons a bitcoin price ticker, e.g. 1
BTC = $446.87 at the start of the video. As he is talking and doing
transactions this exchange rate is being updated, maybe as often as every 30
seconds. And you can see even when he's not doing anything his dollar balance
is fluctuating to reflect the changes (it goes from $10.00 to $10.05 to $10.01
at the start of the video without him doing anything). But the number of
bitcoins remains constant.

So that's a fault of the video I think, that he doesn't explain this clearly
and talks too much in terms of dollars rather than bitcoins. They'll need to
present this more clearly for their actual user video.

~~~
joosters
So why does the BTC amount for the socks that he is buying change, then?
0.05264624 suddenly becomes 0.05265041 despite 'zero fees'.

------
gwintrob
[http://circle.com](http://circle.com) \- That must have been an expensive
domain!

~~~
hkmurakami
$26MM in venture funding will get you far. Iirc, color.com was purchased for
$200,000. This was probably in that ballpark.

------
jerguismi
Circle has been in "stealth mode" for like a year, and still hasn't published
anything else than press releases. It is annoying how much press you can get
without actually delivering anything concrete.

------
ZenPro
Essentially, for the benefits of anonymous transactions I need to -

[1]Change Fiat Money into Fiat CryptoCurrency

    
    
      >> incurring a fee and absorbing risk
    

[2]Use a Third Party Application to Purchase Something

    
    
      >> incurring a fee
    

[3]Change Fiat CryptoCurrency back to Fiat Money

    
    
      >> incurring a fee and absorbing risk
    

> >

[4]Hope that Steps 1 and 2 become so popular I no longer need 3.

[5]Wait on employers and clients paying me in volatile crpytocurrencies

------
bprater
Jeremy Allair and his brother invented the Coldfusion programming language,
later bought by Adobe. Bright dudes!

------
sidko
> "I'm not charged for using my own money" You are, you just don't know it
> because it isn't apparent. In fact, they want to make it appear that you're
> making money for spending money! Ultimately, it doesn't matter who bears the
> additional cost of using credit/debit cards, it results in higher prices for
> everyone and since credit card agencies prohibit differential pricing, it
> punishes people who pay cash.

Bitcoin still has a long long way to go and won't replace the existing system
anytime soon, but definitely watch out for retailers who already provide a
steep discount for using Bitcoin. That will be a good first step.

~~~
mcintyre1994
Can you expand on this a bit? I put money in the bank, no fees are ever
charged. I spend money on the card for that account, no fees. I have a credit
card, pay it off in full every month, no fees. I have direct debits to pay my
bills, no fees. I don't see anywhere I'm charged anything by my bank. I think
I'd have to pay 50p if I wanted paper bills actually.

If your argument is everything is priced higher because I'm not using bitcoin,
the banks aren't getting that money so I'm not sure I understand - will
everyone have to lower prices when everyone accepts bitcoin? I mean that
sounds great but I'm not sure why a capitalist market would indefinitely
reward you for using another currency - when there's nothing to gain marketing
wise we'll see I guess.

------
adamnemecek
Is the name a jab at Square?

~~~
davidw
There seem to be a lot of these things. Circle, Square, Stripe. I'm expecting
to see a Triangle enter the fray soon.

~~~
jyu
Pyramid is a more likely candidate.

------
al2o3cr
Hmmm, a service that charges _nothing_ for things that almost certainly cost
money (BTC-USD conversion, "insurance"), marketed at "non-technical" users,
lots of promises about "nobody will steal your BTC, not like all the other
places"...

Remember the old line that if you don't know who the sucker is at the poker
table, it's YOU?

------
jzwinck
In a business where information security is so important, it's discomforting
to see mishandled HTML escaping on their own News page:

> Bloomberg TV &#8211; Circle CEO Jeremy Allaire Interview on
> Bloomberg&#8217;s &#8220;In the Loop&#8221;

------
nickstinemates
> “At Circle we are very focused on creaing a product that allows us to move
> from early adopter to early majority,”

Always surprised when typos get through, especially for founder/CEO quotes.

~~~
andruby
What does that sentence even mean? It's such an empty statement.

~~~
paulbaumgart
[http://en.wikipedia.org/wiki/Diffusion_of_innovations](http://en.wikipedia.org/wiki/Diffusion_of_innovations)

