Comment by SJC_Hacker
19 days ago
> The real problem is we don't have a low-friction digital payment system that allows individuals to automate sending payment requests for small amounts of money to each other without requiring everyone to sign up for a merchant account with a financial bureaucracy.
Its called cryptocurrency
First you have to make it low-friction. If I want Joe Average to send me $1 in cryptocurrency, how is he getting $1 in cryptocurrency to send me?
>First you have to make it low-friction. If I want Joe Average to send me $1 in cryptocurrency, how is he getting $1 in cryptocurrency to send me?
Absolutely. You're 1000% correct. Cryptocurrency is way too high friction for stuff like that. When I wish to spend crypto, I need to:
[If you don't have an exchange account already, you'll need the 0.x steps too!]
0.0 Create an account on an exchange which is legally allowed to operate in your state/country;
0.1 Provide all sorts of KYC/AML info including photos of yourself and your government ID;
0.2 Wait hours/days/weeks for the exchange to "validate" your KYC/AML info and allow you to purchase crypto;
1. Log in to an exchange which is actually allowed to operate in the place where one resides;
2. Purchase Bitcoin or other coin the exchange deems appropriate (leaving aside the hefty fee charged for using fiat currency/traditional credit card);
3. Wait days/weeks until the exchange allows you to transfer the purchased cryptocurrency out of your exchange-hosted wallet;
4. Transfer crypto to a wallet you actually control;
5. Convert the crypto purchased on the exchange to the crypto coin required for whatever your purpose may be;
6. Transmit the crypto to the destination wallet.
Total time (not including setting up the exchange account, which can take anywhere from 1-10 days): 3-10 days.
Much too high friction for small payments, IMHO.
All the setup is no worse than setting up a bank account
And technically it can be avoided through back channels if you know someone who already has it - can just pay them cash or whatever and they can send crypto to you
Crypto is very easy to transfer once you have a wallet
Its the exchange to/from real world currency where the friction is.
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There is no shortage of apps to do that these days. Venmo and CashApp are pretty mainstream for people in the US.
I'll better keep the $1 to myself than go through the crazy 35 steps KYC onboarding form just to send that $1.