Bitcoin Mining Giants starting to shut down,

[markyh]

2 hours ago, Staffsknot said:

Which is exactly what I said day 1 you can't buy anything directly with BTC. Its the same as buying a giftcard and using that - often the way places do get round it.

There is no BTC to BTC purchase model. That is entirely at odds with what other poster said that they paid vendor direct in BTC.

There's an intermediary step.

 

But any payment transaction in the UK that is not cash in GBP has and intermediatory step.   Paying with BTC via lightning network and strike is no different to using a $USD credit card to spend in the UK. 

It's still true that the Vendor will and can accept payment in BTC , USD, YEN to receive GBP via an intermediatory.  I spent thousands of GBP in South Africa recently on holiday, they happily accepted my UK issued credit card, and they received Rands. 

 

[sackot]

12 hours ago, canbuywontbuy said:

 

When it comes to small purchases, no vendor is going to sell their coffee or beer for BTC directly given its volatility.

 

Yes, you're right about that.

The Lightning network currently has around 5000 BTC (80 million $) sloshing around it. This is completely swamped by the margin power of traders playing silly games with each other, making the BTC exchange rate volatile.

BTC in Lightning is a proxy for the quantity of BTC being used day-to-day for goods and services. For another real-world indicator, if you look at
https://btcmap.org/map
you'll probably see a few businesses around you accepting Lightning/BTC, but vastly outnumbered by those who don't.

The number of BTC in Lightning is heading steadily upwards, though. The hope of Bitcoiners is that at some point the situation cf. traders will reverse. Once they start to lose their precious volatility, I anticipate that most will pack their bags and go, setting off a virtuous circle crushing volatility further.

[Staffsknot]

3 hours ago, markyh said:

But any payment transaction in the UK that is not cash in GBP has and intermediatory step.   Paying with BTC via lightning network and strike is no different to using a $USD credit card to spend in the UK. 

It's still true that the Vendor will and can accept payment in BTC , USD, YEN to receive GBP via an intermediatory.  I spent thousands of GBP in South Africa recently on holiday, they happily accepted my UK issued credit card, and they received Rands. 

 

Exactly what I said - others said not and tried to argue different. Read what I wrote

[Lagarde's Drift]

4 hours ago, Staffsknot said:

Exactly what I said - others said not and tried to argue different. Read what I wrote

I think you're correct here. Until a vendor is happy to receive BTC into their own lightning wallet instead of paying an intermediary to instantly change it to fiat then they're not being paid in BTC 

That being said it's fast and convenient enough so all that matters is whether it's cheaper compared to the tradfi options.

[Staffsknot]

24 minutes ago, Lagarde's Drift said:

I think you're correct here. Until a vendor is happy to receive BTC into their own lightning wallet instead of paying an intermediary to instantly change it to fiat then they're not being paid in BTC 

That being said it's fast and convenient enough so all that matters is whether it's cheaper compared to the tradfi options.

They would have to invoice in BTC and be able to hold BTC in a business account - for transactional clarity.

They can't do that atm

[Lagarde's Drift]

37 minutes ago, Staffsknot said:

They would have to invoice in BTC and be able to hold BTC in a business account - for transactional clarity.

They can't do that atm

No they can't and probably won't given the way crypto law in the UK is shaping up. But you can still disrupt the payments market by being cheaper than visa/PayPal/western union.

[canbuywontbuy]

3 hours ago, Staffsknot said:

They would have to invoice in BTC and be able to hold BTC in a business account - for transactional clarity.

They can't do that atm

As I've said before, nobody would want to sell something they sell on a daily basis in a currency that's extremely volatile anyway, nor is it convenient for accounting to collect various different currencies.  What coffee shop sells items in various different currencies? They sell in one currency. The fact that someone can de facto buy a coffee with their BTC and the seller receives GBP is a feature, not a bug.  As @markyh mentioned, this is how credit/debit cards work when you're overseas and buying something in a foreign currency.  No seller would want your GBP in South Africa - they want ZAR.  That's not a "weakness of GBP", it's a convenient function of credit/debut cards that utilise forex to deliver ZAR to the seller.  The point is that these facilities remove friction for both buyer and seller.  If you feel you won an internet argument over the idea that nobody is sending BTC from one BTC wallet to another BTC wallet for a coffee, nobody would want to anyway.  For bigger ticket, one-off sales, sure.  But for regular small payments like buying a coffee (something a vendor won't want to change the price on minute-by-minute), of course not. 

Edited December 5, 2022 by canbuywontbuy

[Staffsknot]

9 hours ago, Lagarde's Drift said:

No they can't and probably won't given the way crypto law in the UK is shaping up. But you can still disrupt the payments market by being cheaper than visa/PayPal/western union.

Yes but all the large European banks are getting behind EPI the new European initiative.

'Disrupt' usually means elbow your way in and then gouge out similar costs once established. 

[sackot]

In the 'buy coffee with bitcoin', there's one respect in which I'm in a grand minority of one; I don't think anyone here agrees with me.

All the "yeah, it's basically the same as any forex transaction on a VISA card, via a middleman": at one level, yes, but with an important difference. The middleman is never in the middle, he works for one side or the other.

I could sign up at a crypto exchange and get a VISA debit card. It works like this:
1) Sign up for VISA card.
2) Deposit BTC (because it's a debit card)
3) Exchange runs off with BTC (or locks my account, or goes bankrupt, whatever).
I F..d up. I gave my bitcoin to a trusted third party.

In the coffee shop case, I go in, send my sats, drink my coffee, leave. That afternoon the exchange goes bankrupt... no skin off my nose. Not even a big deal for the coffee shop so long as they are repatriating their GBP promptly. Now I'm using a cash equivalent, a bearer instrument. I can swap it with my friends, or use it in a shop.

In the first case, the middleman worked for me, in the second, for the coffee shop.

In Africa they have a lightweight system like that called M-PESA, based on swapping mobile phone credits. Bitcoin offers something equivalent for the unbanked, exchanging small sums with almost no fee, and yet the same system is bulletproof and battle-tested enough that Tesla felt able to store 1.2 Billion USD worth on the blockchain. I personally think that's amazing.
 

[shlomo]

Dec 13 (Reuters) - In mid-2020, FTX's chief engineer made a secret change to the cryptocurrency exchange’s software.

He tweaked the code to exempt Alameda Research, a hedge fund owned by FTX founder Sam Bankman-Fried, from a feature on the trading platform that would have automatically sold off Alameda's assets if it was losing too much borrowed money.

In a note explaining the change, the engineer, Nishad Singh, emphasized that FTX should never sell Alameda's positions. "Be extra careful not to liquidate,” Singh wrote in the comment in the platform's code, which it showed he helped author. Reuters reviewed the code base, which has not been previously reported.

The exemption allowed Alameda to keep borrowing funds from FTX irrespective of the value of the collateral securing those loans. That tweak in the code got the attention of the U.S. Securities and Exchange Commission, which charged Bankman-Fried with fraud on Tuesday. The SEC said the tweak meant Alameda had a “virtually unlimited line of credit.” Furthermore, the billions of dollars that FTX secretly lent to Alameda over the next two years didn't come from its own reserves, but rather were other FTX customers' deposits, the SEC said.

The SEC and a spokesperson for Bankman-Fried declined to comment for this story. Singh did not respond to several requests for comment.

The regulator, which called the exchange “a house of cards,” alleged Bankman-Fried concealed that FTX diverted customer funds to Alameda in order to make undisclosed venture investments, luxury real estate purchases, and political donations. U.S. prosecutors and the Commodity Futures Trading Commission also filed separate criminal and civil charges, respectively.

The complaints – along with previously unreported FTX documents seen by Reuters and three people familiar with the crypto exchange – provide new insights into how Bankman-Fried dipped into customer funds and spent billions more than FTX was making without the knowledge of investors, its customers and most employees.