I’m surprised Visa and Mastercard were allowed to operate in Cuba before this. Most US financial companies don’t serve the five countries on the US’s naughty list: Cuba, North Korea, Iran, Venezuela, and Russia.
Or at least, diversified so it’s not only those two, and there’s a multitude of options.
A fair few countries do that, for example, with payment being diversified into other systems like Alipay, and the other QR-based payment systems. Australia has EFTPOS, HK lets you use your Octopus to buy things in addition to paying for the train fare.
Otherwise, you’d be in trouble if MasterCard/Visa decided that they didn’t like something you did very much, so you’re barred from their services.
Unless you want to count Bitcoin (which technically is a free and open source payment network), payment networks really do need a central organisation to run the network and do the record-keeping. Decentralised payments really just don’t have the properties desirable for modern financial systems
What you think goes away when a financial system collapses: dodgy bankers, predatory financial institutions, money influencing politics, centralisation of wealth, rampant corruption
What actually goes away: access to cheap credit, the ability to transact business remotely, the ability to plan for the future financially, and your ability to save
What remains after the financial system collapses: dodgy bankers, predatory financial institutions, money influencing politics, centralisation of wealth, rampant corruption
No, you do. You just don’t realise it. If you live in any developed country or even most developing countries, you have all of these. Your comment is really giving off the vibes of someone who doesn’t know what they have because they’ve never lived in a world without it.
When I say “access to cheap credit”, I mean that you can, if you want, go down to your bank and ask for a personal loan. As long as you are not already overburdened by debt and have a decent income, the bank will lend money to you at interest rates that medieval kings could only dream of.
Without the financial and legal infrastructure to facilitate, what are your options? Without the state to enforce debts and contracts through legal channels, people historically have resorted to threats and violence instead. And all that risk means interest rates get jacked through the roof. Triple digit APRs, baby.
When I say you have the ability to “transact business remotely”, I mean that you can pay money, be paid money, and conduct financial business without having to physically attend in person to exchange physical objects (like coins or banknotes). The financial infrastructure in place allows you to transfer money anywhere in the world from your fingertips. You can sell or buy almost anything online, pay, and have it delivered to your doorstep without ever talking to anyone or leaving your house. Without that financial infrastructure, your options are pretty limited. Either unregulated trust-based informal systems, or you have to go and bring physical goods or money to someone.
When I say you “have the ability to plan for your future financially”, I don’t mean you have the ability to plan yourself into a comfortable future. Being poor doesn’t negate this. You have a job (presumably), and every month you can expect some regular amount of money to appear into your bank account. You can plan on that happening. You can also plan on the fact that said money has a predictable value. You also can predict with good certainty what that money can buy. All of that is because the financial system has created an incredible amount of currency stability. Even countries with poor economies by modern standards are incredibly stable by historic ones.
When I say you “have the ability to save”, I don’t mean that you personally are guaranteed to have excess money to save. I mean that the very act of saving is not made impossible. If you have the money, you can put it in the bank, and you can reasonably expect to get that money back later, possibly with interest. In comparison, in a country that’s in a state of economic collapse, you can’t put money in the bank without risking not being able to get it back. You can store cash at home without the risk that the Government will just declare your money invalid or inflate away its value. You might not even be able to buy gold because the Government forbids “hoarding” gold. The act of saving, the accumulation of excess money, is literally impossible for the everyday person in that scenario.
This might not apply to you, but as a person whose family immigrated from a second-world country to a first-world one, I see far too many Westerners complaining about how bad they have it and how they wish everything would collapse. Buddy, if everything collapsed you’d have it even worse. This isn’t even “champagne socialism” or whatever the hell the reactionaries call it, it’s just plain ignorance of how the world works and what one shouldn’t take for granted.
With modern fiat money though I don’t see how any model other than a centralised one could work. The Government’s backing is what gives it value. Blockchain is just a way to have 1000x the people each spend 100x the resources just so it isn’t one entity running the show.
I don’t use it, but modern blockchain isn’t how it used to be. It’s no longer proof-of-work, where you do a bunch of computation for nothing (with a few exceptions that still do this).
Basically, what’s required is just a receipt that says “X owes Y $Z”, and that needs to be accepted by nearly everyone. That’s essentially what blockchain is, and it’s also what banks and payment services do. You just need a system you can prove is secure and accurate. Centralization is one option for this, but I see no reason for it to be required.
Also, I disagree that this works because of government backing. That has to do with currency, and there’s no reason this needs that. We just need to track value exchanged. It doesn’t even need to be a real currency as long as we agree on the value and it’s stable. Government backed currency is an option for this, but not necessary.
In addition, any payment provider, centralized or otherwise, can use this currency. Nothing about a government backed currency makes it unsuitable to be used for a decentralized payment processor. The only thing that matters to that functioning is that it’s secure and reliable. It could use USD, Bitcoin, or cows for all the user cares, as long as it’s stable and they can get their value when they need it. Payment processors usually use whatever local currency is, but they aren’t actually using that money. That’s a display. It’s exchanged when needed, or there would be a ton of processing that isn’t required.
I’m sorry, but you’re describing an open-source, decentralised, peer-to-peer, permissionless digital payment network. Which is exactly what cryptocurrency is. But I think you know that if you openly advocate in favour of cryptocurrency here, you instantly get downvotes on Lemmy. So you’re doing it in a fairly roundabout way.
I don’t know where you get the idea that blockchains are no longer proof-of-work. Bitcoin is still the largest cryptocurrency and it’s still using proof-of-work. It’s not really what I’m getting at though, when I say that a decentralised system is 1000x the people each doing 100x the work. Even a proof-of-stake system will still have a lot of work that each node has to do, validation transactions, and that amount of data that has to be passed around serves as a ceiling on transaction capacity. Bitcoin is notoriously low at 1 (“virtual”) MB every 10 minutes. But even larger limits or Ethereum’s sharding strategy would be utterly overwhelmed by the transaction volumes of traditional finance.
I’m sorry, but you’re describing an open-source, decentralised, peer-to-peer, permissionless digital payment network. Which is exactly what cryptocurrency is.
I didn’t say peer-to-peer or permissionless, but that would help. Anyway, yes, those are all things cryptocurrency is, but they are not cryptocurrency. They are a set of design requirements. Cryptocurrency is not necessary for those requirements. There are other ways to potentially meet those requirements, which could be better than cryptocurrency.
This isn’t to say cryptocurrency isn’t the right solution for this. It might be. I don’t think the limitations are as impossible as you do. Sure, costs for running the network would be higher, but what’s the cost for running Visa? I have no idea, but I’m sure it isn’t free. Cost is just something that has to happen. There could be a donation funded foundation that runs it, or it could be funded by a portion of each transaction, or something else. Costs are a hurdle, not a barrier.
To clarify for others bitcoins transaction limit is a choice. Bitcoin blocks originally had no limit. One was put in place to limit spam. The restriction could be lifted now but doing so would increase the storage and bandwidth requirements for nodes.
Lemmy loves open source except if it is bitcoin or Ethereum. I don’t get why so many are so happy for their government to be able to control their wealth through currency manipulation. Plus governments also use money to suppress dissent or ideas the gov’t doesn’t like, aka things like Wikileaks.
Cryptocurrency is also prone to manipulation and it doesn’t have to be through the protocol. Did you think the increase in value of bitcoin to over $100k per coin was organic?
So their “evidence” is that people use new tether to buy bitcoin after bitcoin prices have gone down. Fundamentally they don’t show that people aren’t buying tether but they falsely claim it is evidence of manipulation. The data could also be explained by folks purchasing new tether to buy bitcoin. The paper is from 2018 and tether has gone through numerous government investigations since with no major action. This paper lacks anything resembling real analysis and does not meet the standards of a scientific paper.
Source: I’ve been on more than 40 physics papers and have personally solved more than one impossible physics problem.
I’m glad most countries are developing their own national payment systems to get away from those leeches. The US central bank actually developed its own instant payment system called FedNow but you’ve probably never heard of it. Wonder why? Because participation is voluntary and banks aren’t required to give their customers access to it…
Yeah, I’m also kinda surprised cuba apparently allowed them to operate there? There are few companies that more thoroughly exemplify the imperialist state than those two.
Well sometimes in their pursuit of making money, their interests coincidentally align with those of the public and they make the world a better place as a result.
For example, Valve trying to protect their market dominance in the PC gaming industry has resulted in large improvements to game distribution, consumer protection, and convenience for computer game players.
Another example is the mail order drug company owned by Mark Cuban (the billionaire). He’s making buckets of money from it, but their profit model is to cut out the insurers to buy drugs from manufacturers at wholesale prices and sell them for cheap. So the medicines he sells are drastically cheaper. I actually am a beneficiary of this. I normally buy my medication from his company for $5 a bottle but one time I spilled it and had to get a refill from a local grocery store pharmacy which cost $100 a bottle (insurance paid $85).
But at least the pills from the grocery store pharmacy were blackberry flavour.
Well sometimes in their pursuit of making money, their interests coincidentally align with those of the public and they make the world a better place as a result.
And this happens purely by chance, and always temporarily. As soon as it is financially better for them to throw you to the wolves that’s what they’ll do next
… The dutch east india company hasn’t been relevant for more than 200 years, but like fair enough. If you want to have “capitalist megacorp fightclub” that could absolutely be one of those few I mentioned. I’m gonna defend that “the primary architects of the global financial transaction system” are good entries onto the list though…
I feel like if you want to blame a company for creating the modern financial system, John Pierpont Morgan and the company which bears his name are probably 10x more responsible.
And that company isn’t even a little bit relevant right now, nor has my intent ever been to figure out which company is the “most to blame”. But neat, thanks for sharing your opinion, I will continue to consider Visa and Mastercard to be among the few absolute worst offenders.
I’m surprised Visa and Mastercard were allowed to operate in Cuba before this. Most US financial companies don’t serve the five countries on the US’s naughty list: Cuba, North Korea, Iran, Venezuela, and Russia.
Those two companies have a lot more power and influence than I think they actually want anyone to grasp
Should be 100% nonprofit and owned by the public. Totally worthless to humanity that they remain as businesses.
Most of what they do should just be FOSS anyway or the equivalent.
Or at least, diversified so it’s not only those two, and there’s a multitude of options.
A fair few countries do that, for example, with payment being diversified into other systems like Alipay, and the other QR-based payment systems. Australia has EFTPOS, HK lets you use your Octopus to buy things in addition to paying for the train fare.
Otherwise, you’d be in trouble if MasterCard/Visa decided that they didn’t like something you did very much, so you’re barred from their services.
Totally agree
Unless you want to count Bitcoin (which technically is a free and open source payment network), payment networks really do need a central organisation to run the network and do the record-keeping. Decentralised payments really just don’t have the properties desirable for modern financial systems
I mean good TBH modern financial systems need to collapse for us to survive.
What you think goes away when a financial system collapses: dodgy bankers, predatory financial institutions, money influencing politics, centralisation of wealth, rampant corruption
What actually goes away: access to cheap credit, the ability to transact business remotely, the ability to plan for the future financially, and your ability to save
What remains after the financial system collapses: dodgy bankers, predatory financial institutions, money influencing politics, centralisation of wealth, rampant corruption
I already have none of those things? And neither do like a solid 80% of my peers. These things have already gone away for a large swathe of people.
No, you do. You just don’t realise it. If you live in any developed country or even most developing countries, you have all of these. Your comment is really giving off the vibes of someone who doesn’t know what they have because they’ve never lived in a world without it.
When I say “access to cheap credit”, I mean that you can, if you want, go down to your bank and ask for a personal loan. As long as you are not already overburdened by debt and have a decent income, the bank will lend money to you at interest rates that medieval kings could only dream of.
Without the financial and legal infrastructure to facilitate, what are your options? Without the state to enforce debts and contracts through legal channels, people historically have resorted to threats and violence instead. And all that risk means interest rates get jacked through the roof. Triple digit APRs, baby.
When I say you have the ability to “transact business remotely”, I mean that you can pay money, be paid money, and conduct financial business without having to physically attend in person to exchange physical objects (like coins or banknotes). The financial infrastructure in place allows you to transfer money anywhere in the world from your fingertips. You can sell or buy almost anything online, pay, and have it delivered to your doorstep without ever talking to anyone or leaving your house. Without that financial infrastructure, your options are pretty limited. Either unregulated trust-based informal systems, or you have to go and bring physical goods or money to someone.
When I say you “have the ability to plan for your future financially”, I don’t mean you have the ability to plan yourself into a comfortable future. Being poor doesn’t negate this. You have a job (presumably), and every month you can expect some regular amount of money to appear into your bank account. You can plan on that happening. You can also plan on the fact that said money has a predictable value. You also can predict with good certainty what that money can buy. All of that is because the financial system has created an incredible amount of currency stability. Even countries with poor economies by modern standards are incredibly stable by historic ones.
When I say you “have the ability to save”, I don’t mean that you personally are guaranteed to have excess money to save. I mean that the very act of saving is not made impossible. If you have the money, you can put it in the bank, and you can reasonably expect to get that money back later, possibly with interest. In comparison, in a country that’s in a state of economic collapse, you can’t put money in the bank without risking not being able to get it back. You can store cash at home without the risk that the Government will just declare your money invalid or inflate away its value. You might not even be able to buy gold because the Government forbids “hoarding” gold. The act of saving, the accumulation of excess money, is literally impossible for the everyday person in that scenario.
This might not apply to you, but as a person whose family immigrated from a second-world country to a first-world one, I see far too many Westerners complaining about how bad they have it and how they wish everything would collapse. Buddy, if everything collapsed you’d have it even worse. This isn’t even “champagne socialism” or whatever the hell the reactionaries call it, it’s just plain ignorance of how the world works and what one shouldn’t take for granted.
None of what they said precludes centralization. You can have a centralized FOSS platform, like the Linux kernel, for example.
Also, I don’t necessarily subscribe to your premise. It needs to be organized, but I don’t think I agree it needs to be centralized.
Aye, I suppose your right on the first one.
With modern fiat money though I don’t see how any model other than a centralised one could work. The Government’s backing is what gives it value. Blockchain is just a way to have 1000x the people each spend 100x the resources just so it isn’t one entity running the show.
I don’t use it, but modern blockchain isn’t how it used to be. It’s no longer proof-of-work, where you do a bunch of computation for nothing (with a few exceptions that still do this).
Basically, what’s required is just a receipt that says “X owes Y $Z”, and that needs to be accepted by nearly everyone. That’s essentially what blockchain is, and it’s also what banks and payment services do. You just need a system you can prove is secure and accurate. Centralization is one option for this, but I see no reason for it to be required.
Also, I disagree that this works because of government backing. That has to do with currency, and there’s no reason this needs that. We just need to track value exchanged. It doesn’t even need to be a real currency as long as we agree on the value and it’s stable. Government backed currency is an option for this, but not necessary.
In addition, any payment provider, centralized or otherwise, can use this currency. Nothing about a government backed currency makes it unsuitable to be used for a decentralized payment processor. The only thing that matters to that functioning is that it’s secure and reliable. It could use USD, Bitcoin, or cows for all the user cares, as long as it’s stable and they can get their value when they need it. Payment processors usually use whatever local currency is, but they aren’t actually using that money. That’s a display. It’s exchanged when needed, or there would be a ton of processing that isn’t required.
I’m sorry, but you’re describing an open-source, decentralised, peer-to-peer, permissionless digital payment network. Which is exactly what cryptocurrency is. But I think you know that if you openly advocate in favour of cryptocurrency here, you instantly get downvotes on Lemmy. So you’re doing it in a fairly roundabout way.
I don’t know where you get the idea that blockchains are no longer proof-of-work. Bitcoin is still the largest cryptocurrency and it’s still using proof-of-work. It’s not really what I’m getting at though, when I say that a decentralised system is 1000x the people each doing 100x the work. Even a proof-of-stake system will still have a lot of work that each node has to do, validation transactions, and that amount of data that has to be passed around serves as a ceiling on transaction capacity. Bitcoin is notoriously low at 1 (“virtual”) MB every 10 minutes. But even larger limits or Ethereum’s sharding strategy would be utterly overwhelmed by the transaction volumes of traditional finance.
I didn’t say peer-to-peer or permissionless, but that would help. Anyway, yes, those are all things cryptocurrency is, but they are not cryptocurrency. They are a set of design requirements. Cryptocurrency is not necessary for those requirements. There are other ways to potentially meet those requirements, which could be better than cryptocurrency.
This isn’t to say cryptocurrency isn’t the right solution for this. It might be. I don’t think the limitations are as impossible as you do. Sure, costs for running the network would be higher, but what’s the cost for running Visa? I have no idea, but I’m sure it isn’t free. Cost is just something that has to happen. There could be a donation funded foundation that runs it, or it could be funded by a portion of each transaction, or something else. Costs are a hurdle, not a barrier.
To clarify for others bitcoins transaction limit is a choice. Bitcoin blocks originally had no limit. One was put in place to limit spam. The restriction could be lifted now but doing so would increase the storage and bandwidth requirements for nodes.
Lemmy loves open source except if it is bitcoin or Ethereum. I don’t get why so many are so happy for their government to be able to control their wealth through currency manipulation. Plus governments also use money to suppress dissent or ideas the gov’t doesn’t like, aka things like Wikileaks.
Cryptocurrency is also prone to manipulation and it doesn’t have to be through the protocol. Did you think the increase in value of bitcoin to over $100k per coin was organic?
Do you have any evidence or are you just making things up?
https://quantpedia.com/a-very-influential-paper-about-tether-bitcoin-relationship-manipulation/
I bet you claim that the dollars in bitcoin ETFs aren’t real either. Bitcoin ETF is growing far faster than gold did. https://finance.yahoo.com/news/blackrock-bitcoin-etf-becomes-fastest-192152139.html
So their “evidence” is that people use new tether to buy bitcoin after bitcoin prices have gone down. Fundamentally they don’t show that people aren’t buying tether but they falsely claim it is evidence of manipulation. The data could also be explained by folks purchasing new tether to buy bitcoin. The paper is from 2018 and tether has gone through numerous government investigations since with no major action. This paper lacks anything resembling real analysis and does not meet the standards of a scientific paper.
Source: I’ve been on more than 40 physics papers and have personally solved more than one impossible physics problem.
That paper is bullshit. Source, have a PhD.
I’m glad most countries are developing their own national payment systems to get away from those leeches. The US central bank actually developed its own instant payment system called FedNow but you’ve probably never heard of it. Wonder why? Because participation is voluntary and banks aren’t required to give their customers access to it…
I actually have! And for more fun this admin is currently trying to fuck with FedNow, becuase of course they are
They don’t even want us to have a post office, you think they’re going to let us get rid of way to siphon off a solid percentage of every transaction?
No but they could make it even worse!
Yeah, I’m also kinda surprised cuba apparently allowed them to operate there? There are few companies that more thoroughly exemplify the imperialist state than those two.
If I had to guess, it’s because Cuba had tourism.
Well, yes. The Americans have money. People like earning that money.
Nestlé? Amazon? HSBC? The fucking VOC?
Come on, there are a lot of evil companies but it’s crazy to pretend Visa and Mastercard are somehow the worst of them.
All of them, as long as their only reason to exist is to chase profit above anything else
Well sometimes in their pursuit of making money, their interests coincidentally align with those of the public and they make the world a better place as a result.
For example, Valve trying to protect their market dominance in the PC gaming industry has resulted in large improvements to game distribution, consumer protection, and convenience for computer game players.
Another example is the mail order drug company owned by Mark Cuban (the billionaire). He’s making buckets of money from it, but their profit model is to cut out the insurers to buy drugs from manufacturers at wholesale prices and sell them for cheap. So the medicines he sells are drastically cheaper. I actually am a beneficiary of this. I normally buy my medication from his company for $5 a bottle but one time I spilled it and had to get a refill from a local grocery store pharmacy which cost $100 a bottle (insurance paid $85).
But at least the pills from the grocery store pharmacy were blackberry flavour.
And this happens purely by chance, and always temporarily. As soon as it is financially better for them to throw you to the wolves that’s what they’ll do next
Sometimes. But even if it is temporary, it’s still good while it lasts.
Nothing too deep about it. That’s the whole thought.
… The dutch east india company hasn’t been relevant for more than 200 years, but like fair enough. If you want to have “capitalist megacorp fightclub” that could absolutely be one of those few I mentioned. I’m gonna defend that “the primary architects of the global financial transaction system” are good entries onto the list though…
I feel like if you want to blame a company for creating the modern financial system, John Pierpont Morgan and the company which bears his name are probably 10x more responsible.
And that company isn’t even a little bit relevant right now, nor has my intent ever been to figure out which company is the “most to blame”. But neat, thanks for sharing your opinion, I will continue to consider Visa and Mastercard to be among the few absolute worst offenders.
J. P. Morgan is absolutely relevant in the modern day.
… J P Morgan Chase is not relevant right now because this is an article about Visa and Mastercard.