[jimmysong]

This article is an example of a person speaking from the perspective of massive financial privilege.

Does the author realize how much people in the third world have been screwed over by banks and why they wouldn't want to trust one? The author's opinion would be vastly different if the author were a resident of Turkey or Lebanon or Nigeria right now.

[severak_cz]

I see this pro crypto argument by disfuctional states a lot. But is there sufficient infrastructure to use crypto in disfuctional state? If you want to be cashless you need a lot of infrastructure around you...

[csomar]

> But is there sufficient infrastructure to use crypto in disfuctional state?

No, but it's better than the infrastructure in their countries.

[oblio]

And you quite very likely need to be willing to break the law, as most countries only recognize/accept payments in local currencies.

[thebean11]

What infrastructure? The sender and receiver need smartphones.

[maxbond]

The same argument can be made here. "You're speaking from a place of infrastructure privilege. Not everyone can afford smartphones. Not everyone has reliable access to electricity. Not everyone has reliable access to internet."

(I'd like to clarify I'm pointing out that this argument can be made, I'm not actually claiming to be familiar with anyone's circumstances or privileges.)

[thebean11]

That's true. I'm not an expert, my guess though would be that more people have access to smartphones with a network connection than have access to a good banking system with stable currency.

[csomar]

A smartphone is no longer a privilege.

> In 2022, the number of smartphone users in the world today is 6.648 Billion, which translates to 83.89% of the world's population owning a smartphone. In total, the number of people that own a smart and feature phone is 7.26 Billion, making up 91.62% of the world's population.

[oblio]

What would you do as a resident of Turkey or Lebanon or Nigeria?

Would you use cryptocurrency for currency or for savings?

[lowkey]

One tends to save in crypto and convert to spend in local fiat or USD as late as possible in order to maximize their protection from debasement of the fiat currency.

[oblio]

How does that get reconciled with the huge swings in crypto value? Some of them are worse than inflation in unstable countries.

[lowkey]

Price volatility is definitely a thing in Bitcoin, Ethereum and altcoins. However there are many other cryptocurrencies whose value is designed not to fluctuate - specifically stablecoins. Ignoring Tether for the moment there are many other stablecoins that can be used to generate savings at a rate of ~50x the interest paid on USD by banks. Imagine someone in Jordan, or Cypress, or Turkey who now has access to USD equivalent on a permissionless blockchain and is able to generate real inflation-adjusted returns on stablecoins.

Regarding the volatility of non-stablecoins, those who hold believe that we are still early in the price discovery of a new class of assets and while I can’t speak for others, personally, I have a longer term investment horizon on the order of 4-5 years at a minimum. Looking back on the price of Bitcoin or Ethereum over any 4 year time horizon, the valuation has grown much faster than any traditional asset class.

[oblio]

> Ignoring Tether for the moment there are many other stablecoins that can be used to generate savings at a rate of ~50x the interest paid on USD by banks.

There's a reason we don't have huge return on investment on most assets.

There's not way that 50:1 ratio can ever possibly work at a large scale. Unless, you know, it's a scam.

It's Econ 101.

[lowkey]

Unless the stablecoins are preferred over traditional fiat USD for some use cases.

For example with stablecoin cryptocurrencies I can move an arbitrary amount to another party with no risk of censorship, no permission required, on an arbitrary Saturday morning at 3am if I wish - all in about 10 minutes. This is impossible with USD fiat.

Because of this utility, there is significant demand for stablecoins by traders and institutional investors who prefer stables over fiat and are willing to pay a premium for this utility.

Also my 50x claim on interest paid on savings is based on a typical US bank paying 0.1% APY.

50x 0.1% = 5% which is lower than many stablecoin savings products offer today.

What makes you so certain that a 5% APY on stablecoins is unsustainable at scale or a scam?