> Users can trade the tokens anonymously 24 hours a day, seven days a week, from anywhere, unhindered by capital controls, “know your client” rules imposed on broker-dealers, and other frictions of the traditional financial system.
These are certainly new innovations and features, be they good or bad.
>> Users can trade the tokens anonymously 24 hours a day, seven days a week, from anywhere, unhindered by capital controls, “know your client” rules imposed on broker-dealers, and other frictions of the traditional financial system.
> These are certainly new innovations and features, be they good or bad.
That's saying a car with its seat belts removed has an "innovative new feature." The usual word for that situation is "regression."
"capital controls" only don't seem like a big deal because you presumably live under a government which you trust, which allows allows cross-border money flows, and which has a relatively stable currency.
Hacker News is generally lucky to be a community of extremely well-organized and put-together people, often with a bit of social clout and wealth. I've noticed on many threads an obliviousness to the fact you've pointed out.
Even In the USA or EU, a significant proportion of people do not have access to something like buying some Apple stock legitimately. Just think of all the people who use those extortionate "cash apps" and payday loan services. Why not just use a bank? The same reason they're not going to be buying Apple stock the proper way.
Most obviously, perhaps no bank account, or no ID. They may not have legal status in the country they live in. They may owe child support. Or tens of thousands of unpaid fines for criminal convictions. Or they have a garnishment against them. Or banks simply won't open an account for them because of bad credit. So on and so on, reasons legitimate, and not, for not engaging with the formal financial system.
This adds up to something like 5 - 20% of Americans depending how you set your threshold. To those people, both cryptocurrencies and possibly-scam crypto-investments are attractive because they offer something otherwise not available.
> There's no benefit to the user to having no seatbelts.
No seatbelts means it's easier to get out of the vehicle (if you planned to or not). Some seatbelts are uncomfortable. Seatbelts add to the materials and assembly cost of the vehicle, and add weight to the vehicle which increases fuel usage and wear on the tires and suspension and road. Maybe they wrinkle your clothes? Installing retrofit seatbelts on a vehicle without them can be difficult and the result may be really uncomfortable. Very ocassionally, it might be preferable to be flung from a vehicle rather than retained in a vehicle during a colission, although that would have to be a pretty specific set of circumstances, because being flung from a vehicle results in a lot of undesirable injury.
Not having seatbelts has minor benefits. All of them are outweighed by the benefits of seatbelts in my opinion (and I think there's broad consensus) but claiming there's no benefit to not having them or that there's no cost to having them is silly.
> There's no benefit to the user to having no seatbelts. There's a huge benefit to having open markets at all times.
I quoted the full sentence, but I was mainly referring to:
>> unhindered by capital controls, “know your client” rules imposed on broker-dealers, and other frictions of the traditional financial system
While you can always find some little exceptions, most financial regulation has actually has good reason to exist and solves actual problems (though maybe not your problems, as in burglary laws do not solve burglars' problems). It's not much of a "feature" to do away with them, since then you just invite the re-emergence of problems that have already been solved or mitigated.
There are no benefits to you. There are plenty of benefits to me. Let the market decide? Probably not. It's easy to accuse people of logical fallacies while somehow you're the sole arbitrator to what is and isn't good for users.
Would you have said the same when we moved from measuring stock prices in increments of dubloons to decimals?
Where does all this HN hostility come from, I thought this crypto stuff would mesh so well with the Silicon Valley mindset. Trading should be instant, totally free, in any increment you choose, across borders! That’s the kind of mentality we apply to so much else in tech right? Is this really a bunch of hackers defending oppressive government regulations written by lobbyists for oligopolies?
Since when does Silicon Valley defend the old ways?
Pricing stocks used to be done in fractions with 16 as the denominator because Spanish traders some 400 years ago quoted prices in fractions of Spanish Gold Doubloons. Obviously decimals are superior, they allow much more accurate price discovery. What are you referring to?
It's poorly written and misleading, if not technically false.
"even before the decimal conversion, some ECNs permitted their customers to enter orders in penny and subpenny increments or their equivalents (e.g., in increments as small as 1/256 of a dollar)"
It appears that 8ths were the official minimum until mid 1997, which must be why I don't remember smaller fractions being very common. I feel like maybe it was mostly penny stocks that traded in smaller fractions?
I also read about it in the book Dark Pools which chronicled the story of a guy named Josh Levine who first implemented the decimal change in his pursuit of free, automated trading for average investors. He’s an absolute legend, someone I think the HN crowd would love.
I've both implemented, and been impacted by, KYC workflows. It is definitely friction. "Required by law," sure. "Prevents money laundering," on occasion. But friction, most definitely.
It's a law that requires financial institutions to "Know Their Customer" in order to operate legally. It's a reasonable law. Following existing regulations will be needed for crypto to have a chance at being mainstream
How is it a reasonable law? It's an invasion of privacy that ties every book you buy on Amazon to your government ID.
People argue that voter ID is an unreasonable burden on vulnerable populations. If that's the case then how is it a reasonable burden for interacting with the financial system?
If cryptocurrency does anything useful at all it will be to make privacy invasions like that sufficiently toothless that the case can be made to eliminate them in the ordinary financial system as well. Arguably it already has and all that's left is to eliminate the pointless KYC requirements.
Yep. It's burdening 99% of legitimate users with a very minor inconvenience, to stop the 1% of bad actors who would otherwise end up doing a lot of really bad things that would harm the 99% in ways that go far outside the scope we think of as covered by the financial system.
So yes, I understand where you're coming from, but my libertarian instincts to reflexively think of KYC/AML as excessive and annoying regulation and untrammeled exchange as a good thing, turn out on closer examination to be simply wrong.
I'm not sure I would categorize it as "minor inconvenience". In terms of financial numbers, it's estimated to cost 180B$ [1]. You also have to consider all the opportunity costs of what we could achieve with a faster and smoother financial system. And you have to consider financial inclusion and all that, there are lots of really interesting financial instruments that I can't access because there's some retail that doesn't understand exactly how it works and because we lower regulations to lowest common denominator, let's just ban it. We are also cutoff from these exchanges like Binance which have much more liquidity, more interesting products, etc.
And I'm not sure that it's all that effective, especially after seeing HSBC launder money for cartels and get away with it [2]. Oh and none of these regulations obviously stopped 2008 or any of the previous crises.
To me a lot of these regulations seem like the TSA security theatre, seems useful, but at this point, pretty outdated and inefficient.
Agreed that this isn't just a "minor inconvenience" and as a resident alien in another country for a while (the UK), I found KYC regulations to be really quite obnoxious — and I was a pretty good position to handle them, at that.
The question of whether it's worth it is a real one, and more honestly answered (whether positive or negative) if we admit these substantial costs.
Okay, fair enough, maybe 'very minor inconvenience' is understating it. And granted that the safeguards are not perfect, and some financial crime does get through. I still think the current state of affairs is a big improvement on what we would have if we just threw out the regulations.
It’s not reasonable. The government should not be snooping into people’s financial accounts anymore than they should be snooping into people’s private homes or email inbox.
It astounds me how even principled civil libertarians wholesale accept an Orwellian level of surveillance on anything related to money. The Founding Fathers would have all revolted at anything even resembling modern KYC/AML law.
KYC does not give the gov't your transaction history, it simply means that your financial institution needs to verify your identity. It is part of an overall strategy to reduce the amount of damage malevolent actors can create.
You might try reading the Federalist Papers before making claims about the founding fathers. Again, it is not surveillance by government anyhow.
> Users can trade the tokens anonymously 24 hours a day, seven days a week, from anywhere, unhindered by capital controls, “know your client” rules imposed on broker-dealers, and other frictions of the traditional financial system.
These are certainly new innovations and features, be they good or bad.