This weekend I went to buy a new car, something millions of consumers do every day of the year.
Buying a this new car precipitated several cascading transactions for me. I had to pay for the new car and sell the old family mini-van.
Both transactions required receiving payments and sending payments.
When I went to pay for the car, I had the cash, so it should have been the simplest of transaction types, a simple exchange of the car, for the cash. All I had to do was to move the cash that was at bank A to the dealer's bank, bank B.
The first wall I hit was the finance dept associated with the bank wasn’t open on a Saturday. Why a department has to be open on the weekend to receive a payment is ridiculous, but this is the current “modern” situation. So I couldn’t even pay for the car over the weekend.
They of course let me keep the car, but to do so, I had to fill out all their credit forms, divulging absolutely all my private information and details. Instead of simply paying for the car, I had to now tell them where I live, how much I make, my social security number, and on and on… Hoping to avoid these types of disclosures and do the simplest of things, it turned out to not work that way, and to not even be possible. Even though I tried not to do it this way, I had to use credit and I could not protect my personal information. As a result, some small dealership in the middle of nowhere has all my personal information. I really hope their cyber security is top notch!
Secondly, when the dealership’s finance department finally opened on the following Monday, since the cash was in my bank account, I suggested they simply do an ACH (checking system) pull of the funds from my checking account given the bank routing number and account number. No such luck! They weren’t setup to do that.
Next, how about you do a “debit” card transaction for the amount? Again, no such luck. The limits on debit cards apparently can’t even be temporarily suspended to allow for a larger than normal transaction. At least this was the case with my bank.
So no, the only option left for me, for getting the money from my bank account to the dealership was to fill out a form at my bank, sign it, take a photo of it, upload it, into a secure document communication app, where they would then issue a cashiers check and Fedex it to the dealership. Really!? All of this would take several days and I would have to keep constantly checking to see if it worked and went through or failed due to some silly technicality. In this modern age of online banking and finance, this is the reality of trying to do a simple cash purchase using the existing banking infrastructure, where the funds are there and good to go.
This is truly a joke, and unfortunately this is not an unusual tale for most people. These types of walls are hit every day by millions of consumers. One can imagine the lost time and productivity of it all. When you go through it to a more conspiratorial mind, it does seem as though all this is mostly designed to force people towards taking or using credit to pay for things. Most people probably don’t even have cash as opposed to credit to pay for things these days but even if they did, good luck doing it.
We need a better system.
The whole time I kept thinking about how easy all this would be made by simply having me issue a bitcoin like transaction, to a crypto address, and broadcasting the transaction. The dealership would have quick receipt of funds and the finality of a transaction without all this nonsense that was inhibiting our exchange.
This would be so much better! When will we get to this world?
The debate whether bitcoins are better than US dollars as stores of value is really beside the point, we need a better system for doing simple transactions with payment in exchange for goods.
Also interesting is the fact that on the flip side of this transaction, I had to sell the mini-van. It had 130k miles on it after 12 years of service. I was selling it for $5k but agreed to take $4k in cash. When I received the cash I kept wondering are these bills good? Can I accept these, the buyer will be gone with the van in a few minutes how can I know that I received something of value for the van that I was about to hand over? What would the wife say if I gave away the family van for a bunch of worthless paper?!
How much better would it have been to have received a crypto transaction like bitcoin. I would have known what I was getting. I would have known it was good money or value. I would have known when the transaction was happening and when I had achieved “finality”. Cash received is not cash until you know it is good cash, this poses problems for people making peer to peer exchanges like these.
We need a system where people know the money they are receiving is good, where there is a quick finality of payment (non-reversible, and verifiable) and where there aren’t loads of arbitrary limits on sizes or amounts getting in the way.
This is what the crypto revolution can provide. The confidence, simplicity, and productivity that would be unleashed by bringing in a superior money system is really what crypto is all about.