I think the autor would argue that we are still in the era of "crypto is too small to fully regulate" stage. But if we take it to the extreme and 50% of all transactions are done with a crypto currency, why would governments _not_ apply all the traditional financial regulations to crypto? Moving money internationally is not hard due to technical reasons, but due to political reasons.
With crypto, you can move a billion dollars in 15 minutes to anywhere in the world for like $15, without giving away either source or destination. To do this, you need to send about 250 bytes of information to any node in the blockchain network, using any way possible, up to and including dictating these numbers by phone or writing them on a piece of paper and smuggling said piece to anybody with a non-censored internet connection.
Goverments can make this illegal, but it is impossible to enforce it. These 250 bytes are just another "illegal number", which can be written anywhere, sewn on your t-shirt, etched in stone, etc. There are many fully secure ways to transmit 250 bytes without anyone knowing about it (including governments). Therefore, there is a secure and bulletproof way to smuggle a billion dollars out of the country without getting stopped.
No one can do anything about it.
(Well, there is a crypto-sanctions mechanism which can taint some money on the blockchain and can make it difficult to sell on exchanges etc. But it just creates some inconvenience -- there are many ways to launder crypto, from mixers to bridges and coinjoin and anonymizing through fees arbitrage and whatever).
Maybe online, but with state actors the fear is what they can/will do to you IRL and how to avoid ever raising suspicion. And moving a billion dollars overnight is something that I think is impossible to do with raising eyebrows, regardless of the technical mechanism to move it.
if you make it illegal to convert btc to cash (which a government can do trivially), my contention is that this will kill crypto. Most people simply don't want to break the law. Much of the liquidity in the system dries up. Yes you can break the law if you want, but that just goes to show that crypto's number one real world use case is to skirt regulations.
The whole point of crypto is that, assuming you stay fully on chain, it cannot be regulated the way banks are. When you have the right keys and a connection to a node, nothing can stop you from sending BTC to another wallet. Regulation of crypto is possible only at the blockchain-tradfi interface (e.g. US Govt could tell Coinbase to not interact with a particular wallet). However, if crypto gains the sort of traction where you can buy most items with purely on-chain transfer, regulation becomes close to impossible as we see with cash.
The government in question can easily pass a law making it illegal for traditional financial institutions to interact with crypto. In this scenario, most users will simply stop using it to follow the law. For the die hards fans they will still reduce the use of the currency. They need to pay for taxes in the national currency and thus need income in the national currency. You still owe taxes on illegal income. Businesses need to pay payroll, vendors, and all taxes in the national currency. All of this means that individuals and businesses need national currency backed transactions to get the national currency to pay the taxes.
I agree that if you made "using btc" illegal then you and I could still send each other BTC. But I believe that you would rapidly see the use of crypto die out if governments cut it off from trad-fi, which they could do trivially easily.
Posession of gold was banned in several leadimg economies such as US and UK in the 20th century [1]. Didnt really stop people from using gold as a store of value.
If we take the logical extreme to mean that 50% of the transactions are carried out by 50% of the people, why would, at least where there are democratic governments, the people actively choose crypto because of its unregulated properties and then promptly undo it all with regulation?
But you're probably thinking of either cases where 50% of the transactions are carried out by a much smaller segment of the population or where there is a dictatorship?
Or is the US BTC ETF just a convenient way to speculate on the rising value of BTC, when the rising value is driven by the illicit activity happening elsewhere?
a lot of negative comments here but i think this is really neat! It is unclear what the case adds besides the form factor and buttons. Is that the main value or does the case provide charging or additional memory or anything like that?
but Goldman wont take your call if you are sub $100MM in revenue (probably need way more than that). So you set up your partnership early in your company life then if the relationship is working fine why would you pay hundreds of thousands or millions of dollars and rebuild your integrations just to have a larger bank partner that none of your users will ever know you are using
Column does not offer many of the options that other bank providers do, is fairly expensive, and may not have been in existence when Mercury chose their vendor. Evolve is not a "random obscure bank" - it is a bank that pivoted to have a main business model of providing b2b platform banking instead of consumer banking.
The major banks don't get into this game because the regulations on banks get much stricter the larger you get. So the fintechs are incentives to partner with "small" (this means sub $50 Billion in AUM) banks to deal with the minimum amount of necessary compliance (still a LOT of compliance working with small banks)
There are plenty of reasons to partner with a bank as a fintech other than to drive debit card revenue.
1. There are lots of regulations that say only banks can do certain actions, like lend in all 50 states under the rules of a single state. Or open a FDIC insured checking account. Or have a unique account+routing number for each user to send ACH funds to (various reasons this could be preferred to everyone ACH to one single global account). These are valuable services without any debit card issued by the fintech.
2. It is basically impossible to become a bank. The government only approves a handful a year. Square (block) actually got approval recently but it is very difficult to do.
As a result of (1) + (2) is that if your company needs any banking products at all you need to partner with a bank because there is just no reasonable way to legally build that functionality yourself.
(2) - well, it isn’t that hard to become a bank, but it is hard to become a bank when your business plan is “we want to operate well outside of established regulation and norms”. (Starting a state chartered bank is particularly straightforward.)
There are many small banks that would like to be acquired and they are generally profitable. A VC-funded fintech would not have a terribly difficult time acquiring a bank, particularly one that wants to offer BaaS, like Synapse did.
Currently working at a state chartered credit union. Although it is "easy" to start one, most states regulations are very strict and lag significantly behind federal ones. Hell, where I work we aren't even allowed to serve businesses, loans, deposits, or otherwise.
My last job's [1] basic premise was trying to get around this by using their VC money to simply buy a struggling-but-still-FDIC-approved bank, and then try and make a fintech on top of that. It seems like that skirted a lot of the issues that most fintechs have to deal with.
[1] It is not hard to find my work history but I politely ask you do not post it here.
3. Smaller banks might be worse at preventing you from breaking the law.
(This data dump exposes lots of customers that should have triggered KYC issues, like an American dog-walking startup remotely operated from Pakistan )
VIVA Finance | Atlanta, GA | Junior/Senior Back-End and React Developers, Project Manager
VIVA is a Fintech Startup based in Atlanta, GA with the mission to build a more inclusive financial system. VIVA offers unsecured personal loans to subprime customers who have traditionally been excluded and taken advantage of by the legacy financial institutions. The VIVA difference is to underwrite heavily on employment history and set up repayments through voluntary direct deposit payments from the borrower paycheck.
We are a VC backed company and have been in business for 5 years. We hit cash-flow positive in May and are now default alive with our ongoing growth series B likely to be our final round. We are growing the team to further support our personal lending product, in addition to getting the staff to support building new products to diversify our revenue streams.
Our tech stack for the back-end is fully on AWS, using Lambda and ECS for compute and Typescript as the language, but experience with this specific stack is not necessary for talented candidates. Preference is given to candidates who can come 4 days a week to our new office on the Atlanta Beltline (next to Krog Street Market) but remote positions are available for strong candidates able to work hours in eastern timezone.
Send me an introduction (alex at viva-finance.com) with a resume and we will be in touch!
This sounds good I guess but would be pretty annoying in practice for basically no upside for the business. I could see having 2 providers that are both randomly used so that we can continue business when one has an outage. But even then I would not be showing the option to my customers. The vast majority of users would be more confused by the options than happy about having options, and likely hurt conversion.
Would you say that offering both "Sign-in with Google" and "Sign-in with Facebook" hurts conversion?
Why would, say, offering both "Verify ID with CLEAR" and "Verify ID with ID.me" create confusion then? Lots of people already use CLEAR at stadiums and airports.
And a lot of people - particularly students and veterans - already use ID.me to verify their ID (so far, largely for the purpose of eligibility for relevant student/veteran pricing, but it could be used to verify their ID in general).
i joined as founding engineer as my second job, 2 years after college. The founders were the same age which I think let them consider a young founding engineer. It worked out for me and I think if you have the opportunity then it is a great time to take the plunge. Knowing what I know now I would likely not take the same role at 30 due to lifestyle requirements (have wife and house now, back then I was paying very little for rent with roomates and had no issue with 12 hour days. I think the risk can make sense early in your career but most founders probably dont want to risk it on an untested dev with sub 3 YoE.
the 3% rule accounts for inflation. Average nominal return 7-10%, inflation of 3.5% average, leaves you 3% withdrawal with no decrease (or even an increase) in principle in real dollars
That's not what the 4% rule means. The 4% rule (modified to 3% by OP) is what you can withdraw without running out of principle. Maintaining the level of principle is a different thing entirely.
Average nominal should be ignored anyway. It's never been a practical number for the individual investor to rely on. Mistakes, allocation models, people having less to invest when times are bad (and market is low), etc.
You can hire one for sure, but in my experience they are of dubious value for very early companies. I would focus on understanding your customers. Do you have product market fit proof? Have you strongly defined who your customer segments are? If you have not then I believe you will waste money with an agency. To get the most out of them, you need to have clearly defined audiences and what the value add to the customer is. These are needed to make an effective ad campaign. But also once you have these details you can also start running the ads yourself.
I don't know what your runway looks like but I think for early stage you should try doing it yourself. Otherwise you are going to run into issues of high minimums for larger agencies.
Thank you so much for taking the time to answer! I do think I have at least product market fit, we know exactly who our customers are, we closed 10 of them and their reaction to your product is ecstatic. I really don't think we have a product problem, but reaching these customers is definitely harder than expected. We did run into high minimums with agencies sadly, so I guess we will have to invest the time and learn what we can!
