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110 sats \ 0 replies \ @nb 3 Aug 2022 \ parent \ on: Galoy Brings U.S. Dollars To Bitcoin’s Lightning Network bitcoin
yup!
The government's insurance makes you whole.
"check your financial privileges" as Gladstein would put it. First I guess those insurances are only in the US, for some amount. and to some extend Europe on lower amount.
The type of product develop here are really tailored to developing countries/the global south.
Important to keep in mind also that this insurance is the perfect concept of "Socialism for the rich and capitalism for the poor". banks make profit by lending too much, ie: overextending their fractional reserve power, and when something goes wrong, the FED have to step in and create new money to make the consumers whole. which society pays by inflation.
Now you hold USD in your custodial Galoy wallet.
one comment on this: Galoy is a software company. we help banks/wallets to run software we develop. we are not aiming at being custodian of any funds (similarly FIS/FISV,Jack Henry develop software for fiat banks, they don't operate the bank themselves)
Your USD is actually some derivative contraption which can depeg (can't it?).
How would it depeg? it's really a fully collateralized solution. Maybe the main risk would be an extended negative funding period, as shared in the risks on stablesats.com
The exchange can get bankrupt (many already did!)
yes that is one of the risk. but if you hold USD or stablecoin, you have similar counter risk.
I don't think companies are insured like physical persons.
that's why companies don't keep a lot of USD on bank account. they typically buy treasuries, because the risk of government going down is lower than the risk of a bank going down.
yup. it's the same if you hold USD in a bank account or even a stablecoin. there is a counterparty risk.
the point is that it works with any derivatives exchanges that has an inverse BTC/USD pair.
and a way to limit the risk is to run the hedging on many exchanges at the same time.
Fufi.Money is somewhat different.
AFAIU, Fuji.money, instead of relying on derivatives, relies on overcollateralization. ie: you need to put $2 in bitcoin value to create one fuji dollar, such that even if the price of bitcoin drop by 2, there is still some collateral. at this point the person creating the $1 would need to add more collateral to not be liquidated.
Why did we choose okx as the first exchange?
because:
- it has high volume (10,000x more than kollider), only second to binance
- it has lightning integration (we've started with onchain, lightning integration will be next)
to be more robust and reduce risk, a multi-exchange hedging definitively needs to be developed.
we're currently rewriting the bot in rust (https://github.com/GaloyMoney/stablesats-rs/), so that it's easier to use with other wallets/banks, and when it's done we will work on adding multiple exchange.
- slack channels are helpful IMO. slack has many limitations but I can't say Telegram is panacea. we had the discussion days ago about switching out of slack but not clear what the best option is if we were to move out it.
- accounts and balance are indeed a trusted setup currently. shared custody rely on the fact it's possible to have a multisig for cold storage and keys holder can be distributed on different people.
- no?
- msats are not real
- you mean one click setup type of things? for small community project that is the long term goal, still a lot to do to get there. for larger projects, they'll all wants specifics things so there will be custom things to configure/implement
- I think we're at the #reckless stage of DLC. it will takes multiple years before we have stable channel imo, because we're compounding the challenges of DLC and lightning.
I'm not familiar with it but I know that it's possible to do some payment where only the sender is online, not the recipient. it used some types of PIN
it depends of the jurisdictions. it would be fair to say that's the case in the US. in El Salvador for instance, crypto was not regulated at the time we started the wallet, whereas traditional is/was heavily regulated.
now, we expect people and company to deploy our stack in (very) different ways:
- some will want to do it at small scale for a local community and may not need/seek any licensing to do so. similar to our experience in El Salvador for instance.
- some companies, like neobanks or corporation that want to operate on the bitcoin standard, or even some city (we're in touch with some that we can't disclose yet), want to deploy our stack and will do it with the intend of getting all the regulatory approval
something along the line of 60% intraledger, 30% lightning, 10% onchain. volume would have higher skew for onchain than transaction count.
we see different regimes across time also. for instance, when Chivo wallet was released, it was really only onchain, so we had a spike at this time, but now lightning is working better on Chivo so we see more of it, thanksfully.
I think most of the barrier are within jurisdictions, not necessarily across borders.
said another way, the key painpoints I think related to going back and forth from fiat to sats. every country has different rules. after the conversation to sats, going to another sats wallet has less (if any) barrier
good idea. I'll do that unless @02f046b2ae send me an invoice in the next 10 minutes for 17k sats
doesn't seem I can send it to @02f046b2ae? there is no intraledger capability for stacker.news? maybe we can help :)
💯
I think Africa is a prime region for bitcoin adoption like Latin America.
Very similar to El Salvador, specially the countries using the CFA. The countries not sovereign on their currency will be the first to adopt bitcoin.
And starting as a grassroot project is the best way to go!
don't have the most insights on this one. https://revault.dev/ is probably a good starting point, but it's more institution than for individual AFAIK
think like Redhat
If a company wants to deploy a bitcoin bank, then they might want to use our codebase instead of developing everything themselves
from here, they could do the deployment and maintenance themselves, but because we know the codebase best, there is benefits in hiring us (lower cost, can provide SLA, know how to add features if needed)
shared custody means that you can have multiple keyholders for a multisig wallet.
the benefits of this for a project like bitcoin beach wallet is that this reduce the trust by not having a single point of failure in who own the keys
similar I guess, but different. AFAIK, strike use either USD in bank account or USDT depending on the jurisdiction.
Our current POC use synthetic USD. a more detailed explanation on how this works is here.
A 1h video explaining how this works in detail can be watched here
It would not be very complicated to also add the option of USD and USDT, we would need to have another dealer that would use a spot exchange instead