[where_to_inc]

I can’t speak to other cryptocurrencies. But at least re: Bitcoin:

1. International settlements of any sum of money (small to large) in 10-20 minutes instead of days

2. Markedly lower money transfer fees compared wire transfer or ACH

3. Ability to be one’s own bank if so desired, avoiding government bank account pillaging (Cyprus, Argentina, many more)

4. Ability to send money anywhere (try paying your staff in Russia with USD these days… we have two; they both get paid in Bitcoin since following Russia’s removal from SWIFT cryptocurrency is now the only way)

5. When comparing Layer 2 transactions, orders of magnitude more transactions processed (global credit card network: 19,000 transactions per second; Bitcoin’s Lightning network: several million transactions per second), for significantly lower fees (very appealing if you are a merchant); payment settlement in hours instead of days

6. Deflationary savings account over medium- and long-term timescales

[lern_too_spel]

1-4 boil down to making illegal payments easy. This is not a technological advantage but a regulatory one. As soon as governments regulate Bitcoin the way they regulate banks, this "advantage" vanishes.

5 confuses theoretical maximum throughput with actual throughput. The theoretical maximum throughput of credit card networks is far higher than the actual, and the actual throughput of lightning is far lower than theoretical. Since only three wallets can join the lightning network per second (if all Bitcoin transactions were setting up lightning channels), its utility for actual transactions between arbitrary wallets remains theoretical as well.

6 confuses the value of Bitcoin with its supply. The value quickly approaches 0 when regulation takes away advantages 1-4.

[kkielhofner]

1) Users don't care about final settlement times. Whether CC, wire, etc perception is reality. I pay with a card, it's done. I wire and they get the confirmation the same day (or less). Some may care but the vast, vast majority of the population does not. Ditto PayPal, Venmo, TransferWise (Wise), etc.

2) Debatable because of volatility.

3) Yes but being your own bank also means losing everything is a forgotten/misplaced password/seed phrase, clicking the wrong link, etc away. I don't know how many password resets a big bank in the US does everyday but I'm sure it's a mindbogglingly large number. The vast majority of the population isn't ready for and won't tolerate this. The fees you describe for payments in the financial system have anti-fraud measure costs (reversals, etc) baked in. Yet another feature of the traditional financial system that has been developed (in reality) after decades of real-world experience. It's the equivalent of every single individual building their own hardened vault and hiring armed private security.

4) Fair enough but there are realities in potentially "skirting" the "law" like this. Banks have significant processes to make sure you're not (for example) "funding terrorism" or whatever which is a serious crime in the US and very easy to do with cryptocurrencies. I, for one, don't want to risk the Feds showing up at my door because my funds ended up with someone on my government's enemies list. Just because you can do it with Bitcoin doesn't magically mean the people with guns and prisons will just say "Oh Bitcoin - nevermind - that's ok".

5) Lightning (and for that L2s) are mostly bolt-on hacks that sacrifice one or more features/properties of cryptocurrencies as originally intended when it became clear they fundamentally don't work for anything beyond toy-level. Again, from a users perspective as long as the payment network allows you to swipe a card and walk out with your purchase ASAP transaction rates are invisible to the user. If traditional payment systems needed higher transaction rates they would magically appear.

6) This is a very dangerous supposition.