Unironically excited to learn: Why is this a blockchain? Why could stripe not just do this (maybe better) without the blockchain bit?

I am actually optimistic that, finally, there could be a convincing answer, because stripe does not strike me as the type of company that would do this without a very good reason. (I am slightly less optimistic, because the page itself does not offer an answer to this question, and instead argues for tempo against other blockchains. But only slightly.)

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_xander 6 days ago | parent | next [-]

Here is my attempt: blockchain is a 'good enough' way to bootload a platform for making permissionless dollar-denominated payments. You could technically achieve the same functionality, with better performance, off an interoperable open standards database and communication protocol. But everyone from global south governments, to the CFTC/SEC, to Mastercard would be after you before liability could be effectively distributed. With the design they're going for, you can vaguely gesture to the stablecoin issuers, node operators and on/off ramp operators that will be there on day 1 as legally separate parties each carrying part of the liability.

I will end with this thought: If we can get to a new local equilibrium where global transaction costs are 10x lower and >30% of global GDP can get paid faster / with better price signals / etc., shouldn't we try even if the tech is non-optimal?

	▲	fruitworks 6 days ago \| parent [-]
		At the end of the day, you are supplanting a monopoly with another and distracting from the main purpose of cryptocurrency which is to eliminate the monopoly role altogether.

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solumos 6 days ago | parent | prev | next [-]

Because you can transfer stablecoins to an end-user without taking custody of it, and that end-user can redeem it in their local market without the local + US-based bank having to talk. It’s faster and cheaper.

Stablecoins are a sort of “glue” between global banking infrastructure that otherwise would be difficult to set up as a provider (due to regulation), slow (due to bank technology for global payments being slow), and opaque (due to the shortcomings of global payments between financial institutions).

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nathan_compton 6 days ago | parent | next [-]

> due to regulation

If the goal here is to overcome regulation isn't all this threatened by the possibility of new regulation that recaptures this behavior?

	▲	saulpw 5 days ago \| parent [-]
		Eventually. But there's a period of time until that's the case, which makes it worthwhile. Kind of a regulatory arbitrage in time.

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fruitworks 6 days ago | parent | prev | next [-]

The controller of the stablecoin has full custody, whether or not regulators realize it.

The conventional system is slow, insecure and does not interoperate well because of regulation.

This whole scheme is just dressing up a centralized payment provider as a cryptocurrency to avoid regulation for a short period of time.

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rank0 6 days ago | parent | prev [-]

How will you redeem your stable coin without some interaction with and approval from a bank? Where do you think the stable coin issuers hold their dollars?

I mean FFS the dang tokens are literally pegged to the dollar.

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Ekaros 6 days ago | parent [-]

Stable coin is digital IOU. Where issuer makes the rules.

I never got the idea how for that reason there is any guarantees that you can get money out in those less served locations.

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rank0 5 days ago | parent [-]

Even in ANY jurisdiction you’d presumably need a contractual agreement with the issuer. IIRC only certain entities may redeem tether/USDC for cash. You at a minimum need an account! Not like I can just send those companies my tokens and get straight cash.

The whole thing is just asinine. The killer use case for crypto is dodging laws & regulation. Not even judging because that’s REAL utility!

	▲	jgilias 5 days ago \| parent [-]
		The vast majority of USDC(T) to cash transactions don’t happen through the redemption mechanism. The redemption mechanism is there for the purposes of holding the peg.

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ycombinatrix 6 days ago | parent | prev [-]

Maybe cheaper for Stripe, since they are offloading their compute to customers?

I don't really get the draw either - what is the point of having a distributed blockchain if it is controlled by a single entity?

	▲	Nextgrid 6 days ago \| parent [-]
		Despite the crypto hype massively dying down there's still a ton of idiots and grifters believing in it in big corps (including banks). Stripe could be targeting that and believes they'd be able to extract more money out of those idiots than what it costs to run this blockchain. This could work as long as they're careful enough not to get high on their own supply.