The argument that the payments themselves are a service (while valid) has to be broadly competitive with the mainstream alternative.
So for "securing the network" crypto is very, very clearly less secure than conventional payments. (Far more hacks, defaults, and not centrally backed by government).
And the fees charged are vastly more and vastly slower.
The service is therefore so much worse at such a higher cost that it seems more like the arbitrary product that a Multi Level Marketing firm ostensibly sells than a real offering. (And the only real USP of "enables criminal activity" is not a valid USP that anyone should allow or touch.)
There are cryptocurrency systems like Nano or GNU Taler which can be broadly competitive with the alternatives AFIK, so long you are using them in a peer-to-peer manner that doesn't involve Fiat.
>And the fees charged are vastly more and vastly slower.
...If you are using a system like Bitcoin or Etherium that has poorly-adjusted artificial limitations on consensus bandwidth. Yes, the cryptocurrency market at large needs a wake up call.
>And the only real USP of "enables criminal activity" is not a valid USP that anyone should allow or touch.
I don't think all less-trustworthy payments should fall under this umbrella of "criminal activity". If I want to send some money to a anonymous person on IRC, I'm not going to give them my credit card info let alone paypal because they're attached to my personal information which could be used to blackmail/dox me. There is a reasonable use-case for giving the average person the same privacy they expect from cash, but with the ability to make transfers over the internet (that are signed in a secure way!).
But in any case the whole point of cryptocurrency is to act non-permissively. You might be right to disagree with its criminal use, especially if you live in a free society (where we agree on definitions of crime that are non-authoritarian). But regardless of what either of us think, the system will continue to develop as long as there is financial interest in DN infrastructure and the cryptography is sound.
It's safer than a credit card, since payments happen by sending currency (like cash) rather than forking over bank or credit card credentials to a website (the equivalent of forking over private keys)
Why should it be safer than paying by credit card? If a payment is fraudulent it's not my problem and I get refunded. If the service I paid for isn't received or is not as advertised I have the means of a charge back. With crypto no matter how turn it it's gone. And looking at customer service at tech companies I put exactly zero stock that I get help from them. So I think you have that backwards.
Transaction fees are far lower
Says who? We don't know that yet, do we?
Edited to add: I think the comparison between handing over my credit card number to a website with handing over my private keys is beyond ludicrous.
This doesn’t explain why paying with Crypto is better though in this use case.
The UK example just shows that a decentralised blockchain approach isn’t required to meet the use case you are describing - in fact it’s worse for the described use case in almost every metric.
Having a different, worse alternative isn’t exactly something to shout about.
The same criticism applies, a global distributed consensus is fundamentally flawed as a payment system, and the current ad-hoc organically grown mess of different centralised payment systems interoperating is somehow still more suited to processing payments quickly and reliably than ‘crypto’.
Fast transfers, trusted partners, regulation, audits, identity verification, fraud prevention, backing, sound money. All these things are important and valuable, and while our current system is really flawed in some ways (in particular the control of politicians over money supply and the monetisation of debt), cryptocurrencies do not offer a solution to the most pressing problems and introduce too many of their own.
These ideas are all technological in nature and avoid thinking about what payment systems are: they're social constructs, not technological ones.
The problem with crypto-as-payment network is that their central appeal is that they bypass all of the regulatory frameworks that protect every day people from money laundering and fraud; bypass sanctions, etc.
As soon as they're subjected to the same regulation and oversight that other payment networks and money transmitters are... there's no point. As a network technology it's slow, inefficient, difficult to develop on and extend. And any organization set up to follow regulations that exist today would have to have reserves, charters, submit themselves to regular inspections, etc and... be exactly what we already have.
Some people think by-passing international wire rails (SWIFT etc) is the big win: I can send money to friends/family in the global south without the fees/sanctions associated with such transfers in the regulated system. I would like to see that become a better experience for people in general but I don't think crypto and bypassing the state is the answer here. It's way more risky for a lot of reasons.
Crypto's main issue is not the UX. It's the volatility and costs(i.e merchants pay less for the same crypto). Until these two issues are fixed it makes no sense to use crypto payments unless you are denied access to mainstream payment networks(visa/mastercard).
The VPN should be integrated at the OS level not browser level.
I view it as paying by cash, so the same type of pitfalls exist. I'm not really pushing crypto as the best payment method, just giving the OP possible alternative payment methods they could use. There is a learning curve to using crypto, which I believe reduces the potential of consumers not fully understating the risk of sending payments. Consumers who want the protections should use a credit card to get those.
That also seems like an inefficient way to handle transactions. This is honestly surprisingly, I always assumed crypto had better payment solutions! After all, that’s what they all proclaim to be - not speculative gambling or scamming.
No one is using crypto out of choice for payments. The gigantic transaction fees alone would deter any sane person from using something like bitcoin, and other coins are even less reputable.
The only reasons to use crypto are either for speculation, or for trade where traditional networks can't be used - illegal activities, transfer to/from certain countries.
The issue is that crypto is still not generally accepted as a payment, plus crypto is already riddled with fees at almost every step, and the smaller the amount the less feasible it is to send.
No, the 22+$ transaction fees are the problem. People are saying that it's no longer a currency because of them, but that just makes it a security. IMO it's currency or scam not currency or security, because there is no inherent value beyond currency.
It also doesn't add value in the first place. If you're a citizen in the USA for example, you probably have a credit card that you can use to instantly make payments either in person or online. If someone hacks your CC info, they don't get to immediately drain your bank account, and in fact usually you lose nothing after contesting it. The fees are generally avoidable, depending on the card.
The only significant benefit that cryptos offer is a scheme that allows you to make payments without handing over your credit card number in case you're not sure some sketchy site is legit. So really, the big appeal of crypto was being the new Paypal. Personally, I would like an open source or federated replacement for Paypal that makes it easy to pay everywhere online without entering a CC, but I would rather not try and create and buy into a new currency in the process of doing so.
Maybe something like GNU Taler can fix the credit card problem, but I'm not holding my breath on bitcoin.
Because it's actually used in the manner and for the sort of purposes cards are presently used - not at all in the way cash is used.
It is, in fact, strictly worse than cash - because it's more irreversible (I'm unlikely to be able to pluck cash out of your pocket from halfway around the world), yet more traceable. (The blockchain as "prosecution futures".)
I disagree. It's definitely a trade-off, and there are downsides to it (this security breach being a good example), but there are also advantages.
With normal ACH and credit card transactions, the payment never really settles, and can be reverted due to fraud for months. That means I have to slurp up lots of data (privacy?) about my users in order to increase my confidence that they won't try to scam me. And even with that, I end up losing significant amounts of money due to payments with stolen card numbers, etc.
With crypto, I know that any payment I receive is final, and I don't have to build privacy violating systems to avoid losing $$$.
Not saying this is necessarily "better", but there are advantages to it. As a user, I'd be happy to pay with crypto if the merchant passed some of the savings on to me.
Payments may very well be held back by regulation. But because crypto currencies are essentially permissionless protocols, they can kind of just…ignore all of that, which makes them useful but also of dubious legality. And it definitely results in adverse selection because then of course people who want to avoid the regular banking/payment system will use the next best thing available.
Still, it’s utility, even if it’s grey market (of course it can be used for black market stuff, but it’s a protocol agnostic of that). For me I have purchased legal stuff with crypto that regular payment processors had essentially banned, so crypto was actually a better option than alternatives like e-check.
There are some services that are just easier to use crypto currency to pay for because the maintainers don't want to deal with payment providers. The paid version of cheogram is a good example. This really was the original idea behind bitcoin: dynamically selecting payment providers every ten minutes so they become a commodity.
So for "securing the network" crypto is very, very clearly less secure than conventional payments. (Far more hacks, defaults, and not centrally backed by government).
And the fees charged are vastly more and vastly slower.
The service is therefore so much worse at such a higher cost that it seems more like the arbitrary product that a Multi Level Marketing firm ostensibly sells than a real offering. (And the only real USP of "enables criminal activity" is not a valid USP that anyone should allow or touch.)
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