Remittances are a hot topic for redditards, forumites, and yes, even some -assettes. The egregious fees levied on the planet’s poorest send pangs of privileged guilt through their weak hearts. “Whoa the injustice!” they bemoan. And bemoan some more.
Of course, they’re as welcome as anyone to undercut Western Union and PayPal in facilitating transfers to the perfectly-well-developed-thank-you-very-much world.i Companies like BitPesa and ZipZap have been waving their magic wands in this direction but seem to have made little progress relative to their media buzz.ii Bitcoin remittances seem to take advantage of Bitcoin’s low fee network, but the physical remittance infrastructure still has to be built, and therefore built overtop of whatever WU and PP have. Unfortunately, this business model is therefore stuck in the days of voting rightsiii and touches fiat, both of which miss the point. To boot, it wouldn’t surprise me if BitPesa and ZipZap don’t undercut the old boys by as much as we’d imagine. The reason being that transfer fees pale in comparison to infrastructure costs.
So if our imaginary remittances corporation isn’t quite as practical or useful as we might’ve hoped, what else can we imagine a globally distributed yet tight-knit group of Bitcoin players accomplishing?
Well, how about what Mayer Amschel Rothschild’s kids did c. 1800?
It was mainly in connection with this movement in bullion that the remarkable plan was adopted of having one of the Rothschild brothers in each of the chief capitals…
James, the youngest of the brothers, was not established in Paris till 1812, the year of Mayer Amschel’s death, and then secretly for the purpose of collecting French coin to forward to Wellington for his advance through southern France; the firm of Rothschild Frères was not founded in Paris till 1817; Karl did not go to Naples till 1821; and Salomon went to Berlin in 1815 to arrange for payments through London to Berlin to the Englishman Herries. It was evidently Nathan who made these arrangements…
The elector’s money had been sent to Nathan in London, who in 1808 utilized it to purchase £800,000 worth of gold from the East India Company, knowing that it would be needed for Wellington’s Peninsular campaign. He made no less than four profits on this: (1) on the sale of Wellington’s paper, (2) on the sale of the gold to Wellington, (3) on its repurchase, and (4) on forwarding it to Portugal. This was the beginning of the great fortunes of the house, and its early transactions may be divided into three stages, in each of which Nathan was the guiding spirit: namely, (1) from 1808 to 1815, mainly the transmission of bullion from England to the Continent for the use of the British armies and for subventions to the allies; (2) from 1816 to 1818, “bearing” operations on the stock exchange on the loans needed for the reconstruction of Europe after Napoleon’s downfall; and (3) from 1818 to 1848, the undertaking of loans and of refunding operations, which were henceforth to be the chief enterprises of the house.
It is reckoned that from 1814 to 1822 no less than £18,000,000 sterling was transferred by them to the Continent, and it was for this reason that the brothers were raised to the Austrian nobility.iv
It’s not that hard to imagine a syndicate of well connected Bitcoin players stretching out to the four corners of the globe, creating a blood-bound financial network. What’s harder to imagine is that anyone with Rothschildsesque connections and means would focus their attention on remittances rather than financing the wars and industrial growth of the future. Bitcoin is a better gold, after all, and it’ll be in high demand as a reserve currency with which to fund global expansion. Bitcoin has already solved the centralization of global currency control, but it will never resolve humanity’s struggles over scarce resources, nor the need to pay for said struggles. In a few decades’ time, it will make far more sense to make such BTC-denominated loans, even if it doesn’t right now.
To create a global lending operation such as this would be a huge strain on anyone’s WoT, and I’m skeptical if even a decade in #bitcoin-assets would suffice. We may therefore be waiting until suitable kin take the charge. After all, while bitcoin can be transferred to anyone, anywhere, anytime, there’s no replacement for local relationships and local enforcement of contracts, which means a brother in every capital.
After the Rothschilds of Bitcoin find their way to the top, we can only hope that their children become such noble patrons of the arts.
Then, we will have our rennaissance!
___ ___ ___
- The “Developing World” needn’t be further fucked by USMegaCorps, their non-neutral net, and their “progressive ideas.” It’s colonialism or nothing at all.↩
- Media Buzz >>> Product Development is largely par for the Bitcoin course. For now.↩
- mircea_popescu: Voting rights are nonsense in bitcoin anyway. what the fuck are they going to do, get a confederatied majority and… what, oust you ? Take over ? Voting rights made sense in the old days of geographically fixed agents and material means of production. that situation changed.
mircea_popescu: Immaterial means of production and geographically dispersed agents reduces the corporate voting to meaninglessness. Not that it worked too well pre bitcoin, either.
chetty: buying stock should indicate confidence in management, sell is lack of such – what better votes are there?
mircea_popescu: chetty exactly. but in the old days of imperfect economy, people actually had to have a backchannel, and take over the tractor or whatever it was. Because you couldn’t afford to let a physical tractor go to waste, as a society. These days, a website going to waste ? heh.
via ye olde #bitcoin-assets.↩
- via not Retardopedia.↩
[…] and enlightening. Imagine having daily conversations with Steve Jobs in the early 1980′s or Mayer Amscheld Rothschild in the early 1800′s. It’s sorta like […]
The problem with the BitPesa model is that they become a chokepoint / single point-of-failure, and are subject to tariffs (which the government has already raised on the existing money transmitters, including M-PESA).
Because there is a nice little premium that can be earned trading bitcoin, and no sign-up/ approval process to begin exchanging to or from bitcoins, there should be a ton of individuals willing to provide Bitcoin exchange. The problem with that though is those who buy bitcoins (e.g, from the who received coins as a remittance transfer) are not able to easily convert those coins back into cash (to be able to provide futher exchange). So what needs to exist are regional “master traders” (wholesalers) who will always have a stock of cash and a willingness to buy coins near spot price (for larger sized trading, … e.g., trades of a few hundred dollars worth or more). That doesn’t yet exist but is badly needed.
It’s too easy and too tempting for Master Traders to just walk with the coins, complying neither with government regulation nor the contracts entered into with their customers. It’s not entirely clear that bitcoin owners are truly looking for remittance options or whether they just like to talk about it. Frankly, bitcoin is too valuable to send back home if it’s just going to be converted back to fiat. The optimal strategy is still to hold the bitcoin and pay WU/PP their fees. Bitcoin will appreciate more than enough to cover the transaction fees. Or at least it has in the past.
[…] remittances? In their current form, at least, they’re not gonna matter. […]
Something something Hawala, something something complete?
Lol ya. Not a new idea. But the hawalese don’t support the arts to anywhere near the same degree. Did you know that there’s a giraffe species named Giraffa camelopardalis rothschildi ?
Now that’s patronage.
I would to know about rothschild bitcoin
I would to know what you mean.
[…] wines are still available today even though their coaches aren’t. Their true successors are similarly unknown. […]