Bitcoin Forum

We have seen this multiple times before... These third party services start by drawing customers into their services, by promising them freedom to use and store their bitcoins as they want and then when they have acquired enough customers, they turn into a Bank or regulated financial institution.  ::)

We have seen this happening with "Circle" and the latest service …. "Xapo"  - ( https://blog.xapo.com/changes-to-our-business-and-service/ )

I guess there are more profit to be made when you are a Bank. Now you can over charge people for transactions and additional services, like the Banks in the Fiat system.  >:(

It is sad to see how these companies are exploiting the Crypto currency community with these Trojan tactics and we are just too willing to fall for that.

                                                                              Who will be next?

Every company out there cares about their profit only, isn't it obvious? They may claim that they are trying to do good and bla bla bla, but who would really believe that? Even non-profit organizations often have some ulterior motives. Don't trust, verify.

Maybe some institutional investors ore companies are happy to work with companies like Xapo, but average Bitcoiners should be able to understand that these companies are against the basic principles of Bitcoin.

I wouldn't be surprised if most of these Bitcoin-related businesses always start off being heavily into Bitcoin. But as with any other business, you need to make money. And if you don't make adjustments for your company to make more profit, chances are, your competitors is going to throw your company off a cliff. Either that, or they're simply being forced to be more strict by the government.

A perfect example in my opinion would be ShapeShift's past issues. Started off openly and quite private, and then when they get bigger, they required AML/KYC, and Erik Voorhees has been heavily dumpstered by the community because of that, saying that he is "an enemy of crypto" or something along those lines. But I could almost guarantee that he didn't really want to require AML/KYC, but was pressured by the government. I mean, I'm pretty sure he knows that requiring KYC/AML would heavily hurt his business, so why would he require that for no reason? It's pretty much you either be more strict, or they shut down your business.

tldr; things are not always black or white.

It's business, by the way, and everyone wanted to get a piece of the pie, a billion dollar crypto market. They've seen that they can 'exploited' the market, like offering third party services, but at the end of the day, they are in not just for the technology.

But we can't really tell the difference isn't it? Because we are so excited when we here that some companies join the crypto bandwagon and shouts adoption, but the back of the minds of those people behind, they could be laughing at us.

When we talk about third party, we mean business and a legal one. The only reason why Facebook didn't went ahead with their token is them being a regulated business. They wouldn't take any risk on their revenues. Coinbase provides it's info to the US government because it want to stay in business. They need to gain favors to earn. Government are mostly against crypto cause they challenge their legal mafia network.

You are right,but do you think that those companies have a choice?
Every company that is big enough simply can't avoid the regulations.Not complying with the regulations means breaking the law and going out of business,or at least staying in the shady side of the crypto economy.
Every company wants to acquire more customers by lowering the fees and making false promises about freedom.This is just bad marketing and weak corporate ethics.Such sneaky business tactics usually fail in the long run.

Most of those who legit only wanted to create something out of Bitcoin were among the first persons to develop something on the Bitcoin blockchain. For example, Gavin Andresen's faucet. It gave away a lot of Bitcoins that he could've kept for himself.

The issue entrepreneurs most often encounter is that when you get the first taste of power, there's a quite high chance you get addicted to it. In consequence, the initial thought and plan of "developing something unique and big for BTC" turns into a plan of profit and control only. This is the reason for +70% of the cases where you have a website that launches as an amazing service and, day by day, starts getting one step more intrusive when it comes to your personal life.

Trying to make a profit and an earning out of everything means doing just that. And when you already have a large userbase, getting more intrusive might overpay the number of users you lose.

There are more people who will do everything just to make the business grow, even in untruthful ways, coz basically business is about money. You'll see less people who is doing business because of the real passion, to serve the people with a profit. Regarding bitcoin third party services, it will be the same as business with no real intention to serve, honestly more of services now always do the talking. Obviously, there have been more established business inclined with bitcoin just because bitcoin is at the top, turning their protocols wouldn't be surprising at all coz they are depending on a heavily volatile asset.

Ok, so what most of you think is that it is a forced shift in business model to bend over for the governments? Interesting... there are a lot of them that are not doing that.. so I reckon you can do it, without having to sacrifice your principles. A quick example I can think of is Freebitco.in (They started as a faucet and then turned into a gambling site and they are still allowing anonymous use of their services)

Yes, comparing a faucet/gambling site with a company like "Circle" or "Coinbase" might sound trivial, but if you look at the traffic that are generated by Freebitco.in and the amount of users it currently has, then it is clear that they are playing in the big leagues.

You can scale and still keep your principles in tact... but the moment you touch Fiat currencies.. you are doomed.  >:(

That is the part of the reason why this forum is created to bring attention of the public by knowledgeable people like you to vital issues that people must be aware of. I want to let you know that no business will be created without intention of making profit. When people offer you services for free, the first thing that must come to your mind is what do they intend to gain because they are not father Christmas ( even you get to pay a token before you have access to father Xmas). This party crypto services provided rendered free services for change for traffic, users and user data and as soon as they obtain a required peak, they explore to other things.

I think they are into Bitcoin technology but the thing is, it is not their priority but profit.  They won't offer the services if they are not into the technology.  And most of those who created such services are supporter and believer of Bitcoin.  It is that they see the needs in this industry and created a service that will help people to supply these needs and at the same time generate profit.

I don't like such intermediaries, and the whole point of Bitcoin was to ensure that they are not needed for financial transactions. However, I think people using intermediaries are aware of the risks (at least, they should be). So I am not sure it's a Trojan tactic if the centralization is quite obvious. At the same time, perhaps some people choose it because they want someone to be responsible and help at least somewhat accountable if something happens. So while the company is of course focused on profits, some people might prefer to buy BTC via companies as this way it feels more 'traditional', I don't know.

Every company is in business for the sake of profit and this applies in cryptocurrencies too. This is very disgusting to see a company to change its way of working and be someone completely different once they acquire enough customers.
I guess there aren't ethics anymore in the business world, everyone just want to make money and move on. But the thing is that we don't trust each other and in order to do a transaction we always have to rely on the third parties.

Speaking of overcharge I see some platforms really charge a lot they are offering new services like buy bitcoin with credit/debit card. Some of them waive fees but the hidden charge is on the rate of bitcoin. Here is a sample. (https://bitcointalk.org/index.php?topic=5249214.msg54550198#msg54550198) Some services provide credits card to their customer it is really like a bank but obviously better than a bank. Instead of beating VISA TPS versus cryptocurrency, they partnered with it and they adapt the VISA technology into their platform. Overall, I guess those platforms still help bitcoin technology adaption.

I guess circumstances made them take those steps. Xapo and Circle had a really good user base (probably back in 2015 Xapo was doing crazy promotion and people over here would talk about xapo everyday). They had no other option but to change their policy or else they would have to end up shutting themselves down (probably the legislature is to be blamed?). I don't see any other reason for them to "hurt" their own business! If everything was fine on their end, they wouldn't change a thing.

Well, profit is profit. And anyone who wants to make a profit naturally has this one feature in their core, deception. Just look at the numerous Ponzi schemes that BTC was involved in the past, and no doubt I believe that there'd be more, and maybe even more variety of it. Idk how BTC developed since I joined late but the start was always the part where earnest people actually actively participated in the development, but now? All I can see are money-making machines that suck out the lives of their customers while having a fake smile talking about profits and promotions.

Well, buying BTC with credit card IS the one that has the most fees compared to others. It has fees for the credit card usage itself plus the additional fees of the exchange, and you never know, there may be other fees hidden that we actually do not know about.

all businesses without an exception exist with only one purpose and that is to make money for their owners. it is the same with bitcoin businesses. but sometimes we see idiots create businesses that can't make any revenue so they have to struggle to make ends meet. Circle is a good example of such businesses that has been a failing one for years that has been trying so hard to make money over the years. they have even blamed bitcoin for their failure in the past once or twice which was pretty funny.

While there may be some that are genuinely interested in developing the tech on bitcoin space, most are still in it just for the profit that they could potentially generate on the bitcoin market by capitalizing on the hype that it brings. After all, they are businesses, and businesses are after one thing and one thing only: profit. For the first part, they will lure people into the idea that they are in it for the development and enrichment of the scene. Afterwards, they will switch from the good guys to the bad guys and start doing what a cultured capitalist will do whenever the time is ripe, which is change terms and lower the services for higher the fee.

We are on bitcoin, but for what? Of course there is hidden benefits for us. Verbally we said we love bitcoin and we want to build a big community to help bitcoin adoption, but fortunately our own benefit behind of it. We take the advantage of bitcoin price. But it doesn't mean we do not love, but everyone here for their own profits, not just for adoption. So every companies policy to get profits and lately bitcoin become dependent to third party. Because most part of bitcoin trading on the exchange which is third party. It's almost become impossible to buy bitcoin without third party. We have to admit that we aren't just using bitcoin as a peer to peer electronic payment service. Bitcoin value would drop if third party stop recognize with bitcoin and it would be very difficult to expand uses. I am not supporting third party, just saying the bitter truth. Centralized organization already grab most of part from bitcoin, situation become like this that we are helpless without third party. There is no way without admit that.

Dickriders are all they are.

We have so many of them joining the Bitcoin community. They are not after promotion or adoption of the technology. They are after the money.

We only need to look at how our exchanges operate. Look at how wallet services are withholding the keys. Who would think they are after decentralization? Who would believe them putting emphasis on freedom? They don't look like they are respecting privacy either.

isn't it obvious that this corporations are just trying to earn as much profit as possible from the start? Because if they don't do it, how can they keep the business running. But we've got to admit that because of them, more and more people are starting to know Bitcoin or cryptocurrency.

For example, a third party wallet in the Philippines. You can buy things, pay bills and even load up your steam wallet using Bitcoin. It's super convenient that it's almost attractive. I've seen a lot of people who doesn't know cryptocurrency are using it because of the benefits. The downside is that you need KYC.

These third party wallets are of course created for their profit, no doubt about that just like other businesses out there. But with them, they are reaching out those noncrypto users to avail their services as like what you gave as example, so in return, they somehow increase crypto adoption. Just like me, I am using a local third party wallet also, for convenient purposes because at some point, you need to convert your crypto to your local fiat. Even if their rates are relatively lower than the global market, you have no choice but to use their services, because that's one way of getting your fiat. And some of them are already offering payment of bills, purchasing game credits or topping up your phone. So it is truly convenient for the user to use third party wallet one way or another. Adding to the fact that overseas workers are finding this now to be one of the cheapest options to send their remittances from abroad. So I am not against with their services, as they are driving adoption to those individuals that are not even well-versed in crypto.

Businesses change products based on demand we've seen this happened a lot of times in history. So it's not surprising that most business owners only target's profit than technology.
Also they cannot avoid being regulated because that a country's law that would cause them to ceaase from operating.
For me, it's still positive for Bitcoin because more and more people are gettiing into it.

In my opinion, a natural thing done by third party bitcoin services, because they do that want to make a profit. A business without
profit is certain to go bankrupt, if we don't agree with third party bitcoin services. No need to use services them, but the fact is we
really need a third party bitcoin services to spend the bitcoins that we have.

You can start off with the best of intentions and you can carry on fulfilling them unfettered as long as you stay under the radar. As soon as your head pops above the parapet the  world beyond comes roaring towards you.

I've no doubt most companies are founded and run by shameless hookers, and why not? That's the essence of business. If you're more idealistic and want to do your bit to increase Bitcoin's usage with your own service in line with its principles you will reach the point where you either have to throw it in or send it off in a direction that pains you. Those are your only two choices.

An interesting parallel is Paypal. If you read about its early plans there are quite a few similarities to Bitcoin's goals. They originally wanted it to be a global financial structure completely outside conventional banking. They wanted it to be a database of money.

Then real life happened and look what it became.

Who said they care about bitcoin? If there are no profits to be made, you wouldn’t be seeing anything like Xapo, Coinbase, Binance and all of them that you’re seeing now. So, they are here for the profit that they are making and not really for Bitcoin. Of course they are doing it for Bitcoin and this community, but these are business people and they are interested in their pockets.

I am not going to blame them, it’s a normal thing, and people will always look for the opportunity to make from anything. And it’s not just about them, even some people here that are acting like they are BTC fanatics are only interested in the profit that they are making. They are the same people that will complain when the price is not rising.