
OpenTransact - A simple spec for financial transactions - pelle
http://www.opentransact.org/
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sophacles
Something like this will never become widespread unfortunately. See, banking
has it too good right now. They get to charge people strange fees, and credit
interest AND they get to charge per transaction on credit cards as well. This
means they get paid whenever transactions happen. With this system it becomes
so laughably cheap to pass money around, it will be like going back to cash,
which means there doesn't need to be a per-transaction overhead. As such, lots
of institutions would lose out on the money they get now. Such things scare
the large existing banks, so they won't support it until they have to. No
merchants will accept it, for the reason that no one uses it. Thus you end up
with a chicken/egg problem.

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pelle
While existing institutions could use it, I agree that they probably wont.

This is a classic innovators dilemma where a bunch of small new services could
form, be ignored, grow and eventually replace the status quo.

I wrote a long 5 post article series about this last summer, which has spawned
the Agile Banking community behind OpenTransact:

<http://stakeventures.com/articles/2009/06/29/risky-business>

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sophacles
Interesting -- looks like a good series. You're right about the potential, but
honestly I'm pretty sure that this won't happen. There is just too much
regulation in place that prevents you from doing anything money related unless
you have a major backer.

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pelle
Regulators are absolutely our biggest headache, but while hard I don't think
it's impossible. It is one of the biggest areas of discussion on the mailing
list.

If you're interested you should join the Agile Banking group:

<http://groups.google.com/group/agile-banking?hl=en>

Regulation is definitely one of the biggest issues, but I theorize if you
build small low value services via the grass roots I am convinced we can then
work with regulators.

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sophacles
I am interested, thanks for the pointer.

