
Digital coins may be on the verge of going mainstream - jonbaer
https://www.nytimes.com/2017/08/03/style/what-is-cryptocurrency.html
======
dcw303
We're a long way off mainstream. Take the Web as an example:

When my university lab computer got trumpet winsock and Netscape installed, it
wasn't mainstream. When Hotbot was launched and could actually search with
some degree of efficiency it wasn't mainstream. When I learned html and
javascript from reading Webmonkey posts it wasn't mainstream. When I switched
to this new upstart called Google it wasn't mainstream. When I could use
Google Maps to zoom in on the house I used to live in it wasn't mainstream.
When I could publish posts on Blogger it wasn't mainstream. When I could post
on Twitter and Facebook it was starting to feel like it was mainstream. But
when my parents could figure out how to get on Facebook on their mobile
phones, I knew that the web had become mainstream, even thought it's debatable
how much of the web is really left.

In the same way that today's web users don't care about html, http, or urls,
digital currency won't be mainstream until they don't have to care about
private keys, bitcoin addresses, or even (gasp!) the blockchain. We're a long
way off.

EDIT: Since I get the sense a lot of cryptocurrency proponents are taking this
as a dismissal, let me say that I do think it has a bright future. I just
think there's a lot of work ahead until we get there.

~~~
CPLX
But with Google your Mom can find out when the store is open and where it is.
Facebook lets grandparents see photos of grandchildren. Reading a blog
replaces reading the gossip column in the daily paper. You could finally buy
plane tickets without driving somewhere.

And so on. The early web was _really fucking useful_ as it started to mature.
It solved a lot of real problems.

What is cryptocurrency going to help these people do that they can't do
already today?

~~~
mrb
" _What is cryptocurrency going to help these people do that they can 't do
already today?_"

International payments confirmed _and spendable_ in minutes not days. Escaping
inflation in Venezuela/Argentina/whoeverisnext. Sending remittance to family
overseas without 10% wasted in fees. Receiving monetary donations for
organizations that might be victim of oppressive censorship. Participating in
modern e-commerce for the unbanked/underbanked. Allowing merchants to save 2%
in credit card fees (which doubles their profit margin if it was 2% to begin
with). Allowing merchants to sell in industries prone to credit card fraud.
Etc.

Gosh it's so easy to find many benefits in cryptocurrencies.

~~~
legulere
> International payments

When was the last time you made an international payment? I never made a
payment outside of the EU and inside the EU I already have free wire
transfers. For most people this is not interesting.

> unbanked/underbanked

You have the right to a bank account in the EU.

> Allowing merchants to save 2% in credit card fees

Currently Bitcoin is more expensive for typical transactions. And there's
direct debit which is practically free at least here in Germany.

~~~
mrb
" _When was the last time you made an international payment?_ "

I love that you asked this question! The very reason it doesn't happen often
is because of _friction_ inherent to legacy payment systems. Cryptocurrencies
remove this friction in cross-border trade, hence are making such transactions
more commonplace.

It's like you saying in 1890 "Why buy cars? People don't travel that much."
But the invention of cars is precisely what increased the desire to travel.

" _You have the right to a bank account in the EU_ "

What about the rest of the world? 6.6B humans?

" _Currently Bitcoin is more expensive_ "

Not for transactions above approximately $100.

~~~
davidgerard
> What about the rest of the world? 6.6B humans?

“Banking the unbanked” is much discussed in international development circles.
Around 2013, Bitcoin advocates started claiming that Bitcoin could help with
this problem. Unfortunately:

* The actual problems that leave people unbanked are the bank being too far away, or bureaucratic barriers to setting up an account when you get there.

* Unless they use an exchange (which would functionally be a bank), they’d need an expensive computer and a reliable Internet connection to hold and update 120 gigabytes of blockchain.

* Bitcoin is way too volatile to be a reliable store of value.

* How do they convert it into local money they can spend? Pretty much nobody accepts bitcoin.

* 7 transactions per second worldwide total means Bitcoin couldn’t cope with just the banked, let alone the unbanked as well.

* A centralised service similar to M-Pesa (a very popular Kenyan money transfer and finance service for mobile phones) might work, but M-Pesa exists, works and is trusted by its users – and goes a long way toward solving the problems with access to banking that Bitcoin claims to.

Advocates will nevertheless say “but what about the unbanked?” as if Bitcoin
is an obvious slam-dunk answer to the problem and nothing else needs to be
said. But no viable mechanism to achieve this has ever been put forward.

~~~
flashdance
> Unless they use an exchange (which would functionally be a bank), they’d
> need an expensive computer and a reliable Internet connection to hold and
> update 120 gigabytes of blockchain.

Some of your points are well thought out, but I couldn't leave this one alone.

The vast majority of bitcoin users don't use a bitcoin exchange to store their
coins. They also don't download the entire blockchain.

SPV wallets exist (like electrum or the android bitcoin wallet) that give the
user complete control over their private keys without needing a copy of the
blockchain or using substantial bandwith.

[https://en.bitcoin.it/wiki/Electrum](https://en.bitcoin.it/wiki/Electrum)

[https://en.wikipedia.org/wiki/Bitcoin_network#Payment_verifi...](https://en.wikipedia.org/wiki/Bitcoin_network#Payment_verification)

~~~
davidgerard
> The vast majority of bitcoin users don't use a bitcoin exchange to store
> their coins. They also don't download the entire blockchain.

I couldn't find numbers on this when I went looking, but that's a numerical
claim. Do you have numbers on this?

~~~
flashdance
Thanks for being curious. I scraped around to find some numbers to back up my
wild claim--I think I did a fairly decent job of it. I do warn you--my numbers
are pretty rough.

Blockchain.info claims to be the most popular web wallet with 10M users and
users have control of their own keys without needing to run a node. Their
android app has 1-5M downloads.

The Mycelium wallet for android has 100k-500k downloads.This is an SPV wallet
like electrum, where users have control of their keys without needing to run a
node.

Bitpay's wallet for android also has 100k-500k downloads, which is an SPV
wallet.

The generic bitcoin wallet for android (also SPV) has 1-5M installs.

Multibit (also SPV) is the only desktop client that posts statistics but it
claimed 1.5 million downloads in 2014. Now that multibit is discontinued (and
bitcoin has gotten more popular since 2014) it's fairly safe to assume that
electrum has numbers quite a bit higher than that. I suspect (although I can't
prove) that electrum is more popular than all of the android wallets--It's
even packaged in TAILS by default.

For comparison, the only popular wallet where users DON'T have control of
their keys is the coinbase wallet with 9 million accounts. Other exchanges
exist, and may have higher volume, but they don't market themselves as wallets
to users.

There are less than 10,000 full nodes running at any given time--and a large
amount of that is running 24/7\. Its safe to say full-chainers are in the
minority if you do some guesstimation.

I got most of these figures from the google play store.

------
jknz
Bitcoin seems quite straightforward and easy to understand, compared to our
current banking system.

A lot of comments mention the difficulty of explaining what is bitcoin and how
it works, and that mainstream people cannot get enough understanding to start
using it.

What about the actual banking system? There are so much mainstream ignorance
about our current banking system.

What does it even mean that I own $2000 at a bank? Ok I understand that I can
withdraw this cash, but other than that it is a very abstract concept, built
into the opaque IT system of my bank.

If I transfer money from bank A to bank B, what does that mean? Did the banks
exchange an envelope of cash? Do mainstream users really understand the
details of a bank transaction? I personal have no clue about the inner
workings of this banking IT systems. Bitcoin seems very easy to grasp.

Understanding quantitative easing? In the bitcoin world this is transparent
and easy to grasp. For my national currency I have no clue of how quantitative
easing is done, by how much, etc.

The more I think of our national banking/currency systems, the more I believe
bitcoin is way simpler to explain and understand.

~~~
wingerlang
It means they are holding $2000 of your money. And if you send it to another
bank then it means they send it to them and now the other bank is holding your
$2000. Nothing hard about that.

Bitcoin might be easy if you're a techie and interested in it. I am not
interested in it and I barely even know where to start. What does it mean to
mine stuff? Blockchain? What.. There is no way my parents would remotely get
started with Bitcoins at this point. And I believe that once it becomes easy
enough for mainstream, it will be as abstract as anything.

~~~
honestlyreally
If everyone wants to take their $2000 out at once, can they?

In most countries that's highly unlikely, so is it really $2000? Or something
entirely different?

~~~
omarchowdhury
What happens to Bitcoin if everyone decides to cash in?

~~~
nileshtrivedi
Same as what would happen in case of USD - price would drop to zero.

~~~
kaffeemitsahne
Well, someone has to be buying all those btc at the other end. It might drop a
lot but I find zero unlikely.

~~~
vertex-four
"Price drop to 0" literally means nobody's buying it, of course. If everybody
(in the absolute) suddenly decided they didn't want to hold bitcoins, the
price would indeed be 0, since there wouldn't be any buyers. (It might even be
negative in some cases - you'd have to pay someone to take it from you.)

------
nemo1618
>For this reason, none of the investors I spoke with engage in short-term
trading but instead choose, in the online parlance of cryptocurrency
enthusiasts, to “hodl” (“hold on for dear life,” rather than sell off for
temporary gains).

Someone trolled this author. "hodl" is just a misspelling of "hold," not an
acronym.

~~~
trendia
First seen here:

"I am hodling."
[https://bitcointalk.org/index.php?topic=375643.0](https://bitcointalk.org/index.php?topic=375643.0)

~~~
noddy1
"Pop bottles and Hodl"

------
AlphaWeaver
I tend to believe this is being upvoted because people want to believe this,
not because it's actually true.

~~~
deelowe
There's also probably quite a few influential people who have a vested
interest in digital currency increasing in value.

~~~
richardknop
This is a big reason. A substantial amount of people with vested interest that
would benefit greatly if the price of crypto increases are in tech and post on
HN.

So you get a lot of crypto and bitcoin related posts upvoted very quickly
here. It's just that HN has disproportional amount of people invested in
crypto so they act in their interest.

Most bitcoin early adopters were hackers after all.

------
dogruck
This is dangerous!

When everyday folks go bust on their crypto holdings, there will be pain,
suffering and retribution. Or, perhaps you agree that we don't need any of
these pesky financial and gambling regulations and safeguards.

If this article was about Beanie Babies or penny stocks, would you be
clapping?

~~~
kaffeemitsahne
Just keep in mind the age-old adage: never invest more than you are willing to
lose. Same goes for beanie babies, penny stocks, and index funds.

~~~
dogruck
Shall we abolish the FDIC and the SEC? Then, should we redirect some of the
funds into gambling addiction support groups?

------
ditn
>“If my landscaper ever asks me about crypto, that’s the day I get out,” he
said.

My hairdresser spent an hour extolling the virtues of cryptocurrencies to me a
few weeks ago, and yesterday an electrician who was in the office was
explaining to us his weekend project which was basically a multisig wallet
written in PHP.

Perhaps crypto has already reached peak bubble.

------
dangero
_it bears mentioning here that the vast majority of cryptocurrency investors
seem to be male, and their Twitter discourse tends to be less than refined,
with insults often lodged at devotees of rival currencies._

The vast majority of cryptocurrency investors probably don't even have a
twitter account. This seems like a big logical jump to make.

------
rubatuga
I believe that crypto currencies will not affect most people’s lives (<10%),
and therefore it will never go “mainstream”. The applications for BTC are
quite limited, and are mostly edge cases such as evading detection, and easy
international transfers. The value of a BTC is currently based on the price of
mining one BTC, plus mass speculation. If you consider the immense
inefficiency and resources required to mine a BTC, you realize that in most
cases using your state’s currency is a better option. The trust and safety
provided by BTC is subject to the law of diminishing returns, meaning that
most will be content with the money system currently being used today.

~~~
malikNF
Lets start with the whole, "crypto-concurrency mining is wasting money"
argument. This link
[https://www.federalreserve.gov/faqs/currency_12771.htm](https://www.federalreserve.gov/faqs/currency_12771.htm)
shows how much it costs to print a currency note just in the US. This shows
how many notes are in circulation in the us
[https://www.federalreserve.gov/paymentsystems/coin_currcircv...](https://www.federalreserve.gov/paymentsystems/coin_currcircvolume.htm)

Then there's the cost in securing the money, transferring it, and keeping
track of it add the cost of fake notes, lost and damaged notes and you should
see where I am going with this argument.

Then lets talk about "application of btc for edge cases" moving money
internationally is not an edge case, it is something that makes the world go
round and disruption in that area is no trivial thing. Its not an edge case.
As for crypto being used by people to avoid detection, well, you can do the
same things with fiat currencies. Why do you think there are organisation like
the FBI hiring highly skilled people to track and trace what people do with
their money. In a crypto world there is a better chance for law enforcement to
catch criminals.

The best thing about the blockchain is it helps us solve the problem of trust,
ofcourse I agree there are problems with this model right now, for example how
mining pools can technically launch a 51% attack on the major block-chains and
the wole tx/s problem. But what you need to realize is these problems are
being acknowledged by the community and are being solved little by little, the
technology is progressing there's billions of dollars worth of money tied up
in this project. One more point, the block chain is not just about currencies,
there's so many more areas where they can be useful. Take a look at the
Ethereum project.

Therefore I am someone who really believe that block-chains are here to stay
and they are going to effect every single one of us.

~~~
stephen_g
It's worth noting that in most countries, notes are a low-single digit
percentage of actual money supply. Most money exists either as central bank
reserves or bank credit.

------
skshetry
And, now, we have two bitcoins. Cash and umm, Bitcoin.I wonder what effect it
has(will have) on the future of cryptocurrency?

~~~
godzillabrennus
Coinbase is going to support cash... as they go others will as well...

~~~
gthtjtkt
Coinbase currently has no plan to support Bitcoin Cash trading. They won't
even support withdrawals until 2018.

~~~
godzillabrennus
Crawl, walk, run. Market demand will change all that.

------
rmason
Quite the day for bitcoin, it may be going mainstream. A few years back I had
to travel to the Valley to find a bitcoin ATM and now there are three in my
hometown!

Front page of today's Lansing State Journal:

[http://www.lansingstatejournal.com/story/news/local/2017/08/...](http://www.lansingstatejournal.com/story/news/local/2017/08/03/lansing-
investing-invest-investment-bitcoin/497148001/)

Can't get more mainstream than that!

------
tudorw
The value of fiat currency is that the issuing entity assures it's worth,
ensures it's security, it's validity and facilitates flow. The benefits of
cryptocurrency may look appealing, however, as a store of wealth it's a long
way from 'mainstream' and I believe entropy will prevail, in the fiat system
entropy is handled, the supply of money is flexible, in a system with entropy,
everyone's wealth will tend towards zero over the long term.

~~~
blueprint
Aren't you talking about fungibility?

~~~
tudorw
not in isolation, no, fungibility is solely a currencies ability to be
substituted for goods.

------
romanovcode
And 2017 will be the year of Linux desktop.

------
Qub3d
Digital coins will go mainstream the same year the Linux Desktop does. (A.K.A.
$currentyear+1)

------
stronglikedan
Regardless of whether it will ever go mainstream in the near future, and as a
newbie to cryptocurrency, is it expected that, whenever it goes mainstream,
the value will?

    
    
      1) Dramatically rise
      2) Rise
      3) Behave as usual (depending on current trend)
      4) Fall
      5) Dramatically fall
    

I just curious. I dabble because some eTailors give discounts for Bitcoin, but
I can also invest a bit at any time (just not enough to seriously get involved
in the day-to-day).

~~~
Nition
There is a limited total number of bitcoins and the number of bitcoins is
increasing very slowly now so technically the more people buy in the more it
should go up. Because there is more money in bitcoins but not more bitcoins.

~~~
stronglikedan
Thanks. So a physical bitcoin is not worth 1 bitcoin, but rather a percentage
of the entire bitcoin market value (maybe not the right term), relative to the
number of physical bitcoins, correct?

~~~
sgspace
Huh? There is no such thing as a physical bitcoin. 1 bitcoin will always be
worth 1 bitcoin. To calculate the total bitcoin market cap you multiply the
number of circulating bitcoins by the current exchange rate for your preferred
currency.

~~~
stronglikedan
> There is no such thing as a physical bitcoin.

Of course there are:
[https://www.google.com/search?q=physical+bitcoin&oq=physical...](https://www.google.com/search?q=physical+bitcoin&oq=physical+bitcoin&aqs=chrome..69i57&sourceid=chrome&ie=UTF-8)

As to how they relate to crypto, I have no idea, which is why I asked about
it.

~~~
reefoctopus
[https://en.bitcoin.it/wiki/Casascius_physical_bitcoins](https://en.bitcoin.it/wiki/Casascius_physical_bitcoins)

------
booleandilemma
My parents know about bitcoin, so as far as I'm concerned digital coins are
already mainstream.

I'm still waiting for them to ask me what an ICO is.

~~~
sillysaurus3
What is an ICO?

(I'm only being half-serious. But it's amusing that there isn't a consistent
definition. It's basically "you can buy an asset I created out of thin air
that may or may not have any utility.")

~~~
avaer
I have a theory that once you can define ICOs, they will cease to exist in
their current form. If the layman buying ICOs for their speculative value
understands the asset they're buying, they might not want to buy it anymore.

~~~
grandDesigns
I have another theory, that this has already happened.

~~~
hathawsh
I see what you did there. ;-)

[https://www.goodreads.com/quotes/2397-there-is-a-theory-
whic...](https://www.goodreads.com/quotes/2397-there-is-a-theory-which-states-
that-if-ever-anyone)

------
gloverkcn
This reminds me of the wired article "the long boom" which described how the
economy was on a permanent upswing. The telco / .com crash happened a couple
years later.

The article asserts that currency will always go up because people will want
it as an investment strategy. Sounds like the idea that real estate value will
always go up

------
Gigablah
I feel like it's already mainstream, in Singapore at least. I was getting a
haircut at the neighbourhood barbershop and I overhead the shop owner talking
about cryptocurrency with a female customer -- stuff like regulatory issues,
Satoshi's identity, altcoins, and so on. They probably had more knowledge of
Bitcoin than I did.

~~~
solomatov
It sounds like a sign of a bubble to me.

~~~
DennisP
Singapore's government has been very favorable to cryptocurrencies. Startups
around the world who want to do ICOs have been basing themselves in Singapore,
along with several other friendly countries. It wouldn't be surprising if the
five million residents of Singapore have an unusually high level of awareness.

~~~
solomatov
I heard similar conversations from laymen in USA recently. During 2000s bubble
I heard that you can hear about perspectives of different IT companies form
unexpected people as well.

------
vinchuco
What exactly is 'going mainstream' as it relates to digital coins? Seems like
everyone draws the line differently.

------
codingmyway
If nothing else, cryptocurrency might do one thing that is needed, if only
roughly and imperfectly, and is to distribute wealth from the the old to the
young.

It's the one counterbalance to the debt based asset bubbles of the last 40
years that have transferred wealth to pensioners at the expense of the young

~~~
otp124
Care to explain? If anything, it's wealth transfer from the coin/token buyers
to sellers.

~~~
codingmyway
Yes, it's from more technically savvy to less technical so to some degree from
young to old. Not exactly of course but it's the one countervailing flow to
the housing and other asset bubbles and debt transfer which have massively
transferred wealth in the opposite direction.

------
ZeusNuts
Merkle tree code that helps run Bitcoin was written by a grandpa aged person,
cryptographic nonces were created by grandpas also and Satoshi and Hal Finney
were of the grandpa group too. This generation can thank the last three
generations no less, for the opportunity of cryptocurrency.

------
asherkosaraju
Not yet in India. It's almost banned here because of lack of compliance.

------
EA
The first digital coin land rush was when people and companies were
registering thousands of somewhat random domain names per day hoping to hit on
one that someone would eventually want.

------
neilwilson
Tulip bulbs are prettier.

~~~
sleazybae
"I am clever because tulips and Holland lol. you certainly won't find ME
getting taken by all those bitcoin hucksters, yuk yuk yuk"

------
jondubois
Money has been getting increasingly less tangible over the past few thousand
years.

Initially, the value of money was in the materials that made it up; e.g gold,
silver coins.

Then people started paying with paper backed by gold; so although the paper
itself had no value, it could be used to redeem gold.

... People got used to paper.

Then people started paying with paper fiat currencies not backed by anything.

Then people started paying with electronic numbers on computer screens in
their bank accounts backed by the fiat paper money.

... People got used to digital numbers in their bank accounts.

Now we have cryptocurrencies which are backed by the electronic numbers in our
bank accounts.

It does seem like a logical progression.

~~~
neilwilson
Money has never been tangible. It always has been a token for a debt owed by
somebody.

There is no difference between a paper bill, a coin and a cheque other than
the account it references.

~~~
jondubois
There is a huge difference between a coin and a paper bill.

Unlike the paper bill, the gold coin is both a currency and a commodity - It
has many useful properties. It can be melted down and turned into jewellery,
used in electronics, tooth fillings, glass-making, paint, etc...

Fiat money can be exchanged for other things but fiat money in itself cannot
be converted into anything useful. Destroying fiat currency to sell the
underlying material is illegal in most countries.

When gold coins were currency, people would shave slivers of gold from their
coins to pay for small things. This emphasises that the value of the currency
was entirely in its material.

The value of a gold coin as a currency was equal to its value as a commodity.

~~~
neilwilson
You've obviously never made a paper plane out of a bank note.

Or had one with a printing error where it becomes a collectible artwork.

The value of any coin is far greater than its metal value in any normal
system. Gold included.

------
Animats
It's all zero-sum. It doesn't create wealth.

~~~
mathgenius
> It's all zero-sum.

But this is the same as "conservation of energy". _Everything_ is zero-sum,
and yet we still do stuff.

> It doesn't create wealth.

Well I have two answers for this. One is simple: these are financial products,
and people need those. The other answer is a question: what is wealth ? Or,
what is value? And these questions are like koans, they are both profound and
also without solution. Wild price gyrations on exchanges going back hundreds
of years are testament to this.

------
wilg
Quick question: what do people do with them? Invest?

~~~
vinchuco
I made happy returns (poor-student-sized and regrettably non-leveraged) on
three occasions simply by monitoring when exposure would go up and timing the
end of hype (e.g. when the first senate hearing on BTC). stats.grok.se, forums
and HN were good informers. Then I quit. I wish I knew the full answer to your
question.

------
chrismealy
Until I can pay taxes with it, not interested.

------
kogepathic
Another way to phrase this is: "Are digital coins on the verge of going
mainstream?" to which I reply: Betteridge's law of headlines

~~~
discombobulate
That's not the headline. The editorialised headline hasn't been changed.

------
discombobulate
Incorrect title.

~~~
discombobulate
The fucking title is wrong. Not only that, I got downvoted for pointing out
it's wrong. & It hasn't been changed.

------
mattdeboard
2017 is the year of Linux on the desktop

~~~
tootie
ChromeOS put Linux on the desktop and no one noticed.

~~~
themacguffinman
That's not really "Linux on the desktop" as its advocates imagine it. For most
ChromeOS users, the Linux-y parts like the shell and the GNU toolchain are
largely restricted.

~~~
ty_a
Not to be overly pedantic but the "shell" and "GNU toolchain" are literally
not Linux.

~~~
themacguffinman
You're right, and I didn't mean to imply those things comprise Linux. They
are, however, what most people are talking about when they say they "use
Linux". GNU + Linux comprise the "desktop Linux" platform.

------
knodi
lol, no. Go ahead download the ledger.

