The more I read about the development of electronic payment tech from 1990-2010, the more it looks like a scam designed to ensure that only existing banking (and those few tech companies the banks selected) were viable options.
Apropos a 2010 post by Paul Graham on why the PayPal founders were geniuses. Maybe this is true, but what did PayPal actually do brilliantly? They built anti-fraud tech so that people could use 1970s credit card tech online.
Why weren’t there dozens or hundreds of PayPals, or people doing more sophisticated cash-like payments on the Internet? Well? There were some of the latter but their doors all got kicked in by the Feds. en.m.wikipedia.org/wiki/Liberty_R…
The commercial banks and payment systems thought it was fine that payments meant “copying 16 digits numbers off plastic cards and typing them into websites”, and this was so hilariously vulnerable to theft/fraud that you had to be a genius to make it work.
It is 2021 and most online payments *still* involve “copying 16 digit numbers off a plastic card and typing it into a webform”. You can’t have a lot of open, permissionless competition in a system so insecure.
Everyone is like “why cryptocurrency” but the answer is that cryptocurrency is what happens when you create a gigantic technical vaccuum. Literally anything that can survive the ambient conditions will fill it.
Anyway I just mostly hate PayPal and I think the answer to most questions like “why did the PayPal founders blah blah” is “because they were deliberately chosen to be the only competitors in a desperately valuable area, and got very rich as a result.”
(Also I feel like it taught a generation of influential SV founders about the value of anti-competitiveness but I’m sure they would have figured that out anyway.)
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