I hear a lot about Western Union and associated costs in the context of remittances. Also there are exchange rates anyway, between one currency and another. Also there is inflation and bank fees.

Why don't normal people use anonymous cryptocurrencies like Monero instead of expensive and troublesome fiat money?

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    How frequently do you think 'unbanked' people use Western Union, anyway? Most transactions for such people would either be in cash, or quasi-bank services like 'Mobile Wallet' accounts available in many countries with lower formal bank adoption. Oct 25, 2022 at 15:29
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    @shoover Sure - probably 1x a month, or perhaps 2x per month depending on their pay schedules. WU fees are what, $5? So which would you choose - $60-$120 / year in WU fees [worst case scenario, where you could probably benefit from more long-term options like full bank service anyway], or the headaches, scam risk, and volatility of crypto, for both you and the recipient? Oct 25, 2022 at 18:41
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    "Why?" you ask? You've already answered it; they're normal people, not crypto-bros. Who the heck wants to be forced into an esoteric system where you have to make accounts like pancake-swap to convert something fictional to something tangible? It's the same reason that I buy gas from a normal part of town instead of driving into the depth of the south side for a 10-cent savings.
    – MonkeyZeus
    Oct 25, 2022 at 20:05
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    unbanked people typically have fewer resources, not more. They likely aren't familiar with crypto and neither are people they want to give money to
    – Mike M
    Oct 25, 2022 at 21:03
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    I think you've made your point that you'd like to educate people and transform everything in the future, @verybigcat. The question of today has been well answered.
    – Mike M
    Oct 25, 2022 at 21:11

5 Answers 5


Let me tell you a true story that I observed in my working life about the importance of failsafes in financial transactions:

I was on my company's M&A team, preparing for the acquisition of another company in our industry. This company had a long list of part-owners [something like 50+]. The purchase price meant that the average payout was something in the ballpark of $100k. For various reasons, we were going to pay each individual party directly, so part of the negotiated sale documents included provision of a list of approved bank details for receipt of wire payment.

In the weeks leading up to the sale, I called each individual to confirm validity of those details. The lawyers on the acquired company did the same thing. Someone who worked under me did the same thing. My boss did the same thing. There were maybe a dozen iterations of the sale documents before finalization, and each time, those details were confirmed to be unchanged, and at the end of it, we had signed verification from each party, as well as the independent phone calls, confirming all bank details.

The day of the sale came and went - everyone got paid, or so we thought. The next day, one of the prior owners called us to say they didn't see the wire receipt in their bank account. We investigated, and found that this guy had given us incorrect details. He had in the multi-100's of thousands of dollars coming to him, and at least 4 separate times, he lied about having his bank details in front of him when he gave the agreement that the info was correct.

Do you know what happened? We called the bank, they agreed that funds had been transmitted to a null account, and after a verification period, the receiving bank reverted funds back to ours, and we were able to pay the amount to the correct person. [note: If the details provided had been a valid recipient account #, it would have taken longer, and a small chance exists that if those funds had been immediately liquidated by the ill-gotten recipient, we would have had to take legal action to rectify the situation. But even in that case, we would have known who it was [or rather, the recipient bank would have known], because of the maintenance of the KYC network].

Do you know what would have happened if this guy had given us an incorrect crypto address? The funds would have been wiped from existence.

This was probably the largest financial transaction of this man's life, outside of possibly a home purchase, with an extended confirmation period and multiple avenues of verification, and he still couldn't get his own bank details right!

So now you tell me - what are the chances that you could explain, safely, the Monero methods, to a man who didn't understand that his bank's phone number was not wire payment instructions?

Edit to redirect to answering the question as asked - per @Geoffrey Brent in the comments to this answer: 'One of the reasons many people don't use crypto is that it's full of people who believe things like "it's okay for somebody to lose their life savings without recourse, if it's by their own mistake"'.

The asker is trying to proselytize about the merits of crypto, specifically to those who don't use it + don't know how to use it, and still finds time to blame such a person for any financial loss they might suffer if they use the system s/he is asking them to use! Well guess what - when faced with the risk of this type of loss due to personal error, most people refuse to get involved!

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    @verybigcat True, but at the same time - pretty nasty, don't you think? I kinda like the bank solution better, even if it was his own fault.
    – Vilx-
    Oct 25, 2022 at 22:17
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    Crypto is underrated as a platform for fraud, theft and ponzi schemes. Oct 25, 2022 at 23:53
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    @verybigcat Except you're talking about additional steps and work as if they weren't additional steps or work. That's not good if someone already doesn't trust it.
    – DKNguyen
    Oct 26, 2022 at 0:38
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    @verybigcat One of the reasons many people don't use crypto is that it's full of people who believe things like "it's okay for somebody to lose their life savings without recourse, if it's by their own mistake". Oct 26, 2022 at 5:01
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    @Itération122442 If somebody sends funds to an address that is not linked to an already-existing key, they might as well have been wiped from existence, because "claiming" an address by reconstructing its key is computationally infeasible. (If that were not true, the blockchain's security would be completely broken, and the whole thing would almost certainly become totally worthless.)
    – David
    Oct 26, 2022 at 7:20

There are several reasons why cryptocurrencies are no option for everyday commerce:

  1. Transfers are expensive. Most cryptocurrencies are designed in a way that you need to pay cryptocurrency to transfer cryptocurrency. Although Monero is one of the cheaper ones in this case.
  2. Cryptocurrency values are unstable. Their value compared to other currencies constantly jumps up and down. Sometimes by several percent-points in a single day. That makes it risky to denote any long-term contracts in cryptocurrency or to hold on to cryptocurrency for too long. Currencies need stability to be useful. People currently complain that "stable currencies" like the US Dollar and Euro inflated by 10% in the past year. This is considered unacceptable by many people. Well, how did the star cryptocurrency Bitcoin do during the same timeframe? The price went from $60k to $20k. That's an inflation of 200%! Other cryptocurrencies didn't do much better. Monero inflated by ~100% and Ethereum by ~300%.
  3. Cryptocurrencies aren't legal tender. That means that contracts which demand payment in cryptocurrencies can be difficult to enforce legally. Anything a civil court can do is force someone who doesn't fulfill a contract about cryptocurrency is to reimburse the other party in regular money.
  4. Cryptocurrencies are unsafe. While a bank can usually revert an erroneous or fraudulent transfer, such things are usually impossible to correct with cryptocurrencies. So people who lose their cryptocurrency because they mistyped an address, fell for a scam or got a trojan will usually not see it again. This problem is worse for anonymous cryptocurrencies where it can be hard to tell who actually got the money now.
  5. Cryptocurrencies aren't user-friendly. Making a cryptocurrency transfer either involves complicated special software or shady crypto exchange websites. They function very differently than the online banking interfaces people are used to. You think IBAN numbers are long and complicated? Well, crypto wallet addresses are far worse.
  6. The cryptocurrency ecosystem is chaotic. There are literally thousands of cryptocurrencies, all with their unique advantages, disadvantages, quirks and infrastructure. It's just too confusing for the average consumer to keep track of what currency they should currently use for what purpose.
  7. Cryptocurrencies are a bookkeeping nightmare. Companies which try to make business in crypto soon find that it's very difficult to integrate in their regular bookkeeping processes. From the perspective of the government, cryptocurrency is a commodity, not a currency. So you can't handle it like a currency. That makes it difficult for companies to treat it like a currency while staying compliant with bookkeeping and tax laws.
  8. Cryptocurrencies are legally shaky. Some countries already have anti-crypto laws which regulate or even outlaw some or all forms of cryptocurrency. Many others are debating introducing such regulations. That means someone who can't use the international SWIFT system for legal reasons might also be prohibited from receiving money via a crypto transfer.
  9. Cryptocurrencies aren't widely accepted. This is admittedly kind of a chicken-egg problem. Few companies accept cryptocurrency because few people want to pay with cryptocurrency. And few people expect to be able to pay with cryptocurrency, because so few companies offer it. But before this chicken-egg problem has a chance of being resolved, the points above need to be resolved.

Admittedly, some of those problems can be solved or at least alleviated by cryptocurrency exchange providers. But if you rely on those companies to take care of all the complicated and annoying stuff, then you pretty much reintroduced the problem cryptocurrencies were supposed to solve. You created a system of privately owned banks which can be regulated by state actors.

  • Sadly legal exchanges and legal businesses need to comply to various laws, for example regarding money-laudering, taxes, accounting etc. That makes setting up an account a bit more difficult than required. In turn it prevent fast and wide acceptance of crypto. Feels like crypto will only win long-term inflation-avoiders. Maybe in informal economy it would be easier to ditch fiat currencies? Oct 25, 2022 at 11:20
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    @verybigcat It's not for inflation avoiders either. If you want to avoid inflation, you buy things with a very stable value. Cryptocurrencies are highly volatile assets. The exact opposite. And Monero, for example, underwent a massive 100% inflation in the past year.
    – Philipp
    Oct 25, 2022 at 11:26
  • it's only because they may fall into or out of popularity. But in the medium to long term, some leading brands such as bitcoin seem quite robust in going up, despite not even being the best crypto to use. And it's a safe bet that somebody will believe in economic freedom down the road, especially that most cryptocurrencies are of strictly limited supply. Just like people see value in gold, despite limited industrial use. Oct 25, 2022 at 11:29
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    @verybigcat Bitcoin is roubst? Did you look at the chart lately? It's a bumpy rollercoaster ride. And in the past year, the direction is straight down. The last 3 month look like a plateau compared to the crazy price spikes in 2021, but still had price fluctuations between 18k USD and 24k USD. Price inflations and deflations of 25% in a matter of month is not what you expect from a stable currency.
    – Philipp
    Oct 25, 2022 at 12:22
  • 1
    You very likely know this, but IBAN Number is wrong, because the N in IBAN already means number.
    – gerrit
    Oct 26, 2022 at 7:17

I wrote it in a comment, but the comments have since been cleaned up (numerously, I think). So I'll write it in an answer.

Unbanked people, those who routinely use cash and money transfer services like Western Union do so because they're either too poor and/or uneducated to use the banking system, do not want to have any transactional trail, or because they're restricted from the banking system.

For the first group, KISS.

People who are poor - they're probably limited in their ability to access high tech, reliable internet connection, and do not want the associated costs. These are the people who use pay-as-you-go phones and won't spend money and time on trying to learn about crypto and use it. They may have heard that it is highly volatile, or they may try it and get burnt with a significant (to them) loss that would inevitably happen quickly due to the crypto's inherent volatility. They also have the access barrier as to convert their cash to crypto to begin with because they are... unbanked.

The uneducated part of that group - they struggle with understanding the conventional banking, why do you expect them to understand the crypto? Think about old people, people with low intelligence, or just people without access to information (in most cases closely related to them being poor). I remember how difficult it was to explain the concept of "email" to my grandfather. He called it "fax" because that was the closest communication concept he was familiar with. That was in late 90s/2000s, not so long ago. Email existed for how long? 30 years by then?

For the second group - well clearly if you don't want to have a trail, crypto is not for you. Trail is built into the system. Of course a lot of criminals and scammers are using crypto, because they (wrongly) believe that it is anonymized and they cannot be identified, so they don't worry about the trail. But those who do - will not use it.

For the third group - the access barrier is still there. Since they're excluded from the banking system, they won't be able to convert cash to crypto and back easily. Some can mine their own crypto (e.g.: Russians right now, North Koreans, etc), but that requires at this point infrastructure that needs institutional support, individuals can hardly mine enough for it to be a meaningful replacement of the banking system and cash.

For everyone else - all the things you see as negatives are considered positives. Regulation, oversight, ability to trace and track, ability to revert transactions and recall funds, ability to identify senders and receivers and easy interaction with accounting and tax reporting due to the operational currency being the same as the official government currency - all these are positives for most people. You are the exception.


TLDR: Because it just doesn't work, and there are far better solutions that do actually work, that people are actually using because they do work.

Long version:

Weaver’s Iron Law of Blockchain... is: When somebody says you can solve X with blockchain, they don’t understand X, and you can ignore them.


The fact that somebody was purporting [vaccine cold chain] to be a real-world application [for blockchain technology] meant they had not even thought about the problem for five seconds. They had no familiarity with how cold chain works. They had no familiarity with how the sensing process works.

We see the same thing when people talk about cryptocurrency being able to “bank the unbanked.”


If you take any of these people and you ask them what M-Pesa is, they will look at you like you’re speaking [Swahili]. Because, well, you are. So for those who aren’t familiar, M-Pesa is a payment system started in Kenya by Vodafone about the same time as Bitcoin. [Note: Pesa is Swahili for money, and the “m” stands for “mobile.”] It has eaten the Third World. It’s huge. Because it just basically attaches a balance to your phone account. And you can text to somebody else to transfer money that way. And so even with the most basic dumb phone you have easy-to-use electronic money. And this has taken over multiple countries and become a huge primary payment system. [Whereas] the cryptocurrency doesn’t work.

So, El Salvador. The president of El Salvador is a totalitarian nutcase. And one of the things he did as a totalitarian nutcase is pass a law saying Bitcoin is legal tender. But you aren’t actually using Bitcoin. Instead, they created a new wallet, the Chivo wallet, that’s an electronic payment channel that takes Bitcoin and dollars and just updates your balance in a central database. It’s not actually doing a transfer. And the Bitcoin folks like to go, “Oh, but there’s this lightning network thing that allows these layer two transfers in a trustless environment, so you aren’t trusting the central Chivo app.” That is still limited to adding three to seven people per second globally to the system. So you can’t actually onboard that system. It just doesn’t scale.

And so the one case where we’ve had an attempt to do a wide-scale “pay with Bitcoin” system, El Salvador, they gave up and aren’t actually using Bitcoin. They’re using a centralized database in an app. And because the value of the numbers in the centralized database bounces around, nobody actually uses it. People just signed up for the free money, then transferred it, and have since stopped using it. [Note: Seeking Alpha reports that “virtually no downloads [of the Chivo app] have taken place in 2022” and “it seems that people were incentivized to download Chivo given the $30 bonus offered by the government.”] So even when you have a central database and a central authority, cryptocurrencies don’t work for payments, because they bounce around in price.

-- Why This Computer Scientist Says All Cryptocurrency Should “Die in a Fire”

  • Under which license is the original content posted. This might be a copyright infringement.
    – Luuklag
    Oct 26, 2022 at 8:22
  • 1
    @Luuklag There is no world in which sharing a small snippet of a large article, which is non-paywalled and already given away for free to the public, with attribution, shared freely for non-commercial purposes, does not count as fair use. Oct 26, 2022 at 10:48
  • 1
    A free use exemption is not a global thing. Depending on jurisdiction there might not even be a free use exemption. Besides that this is far from a small snippet (3-4 lines I would consider small).
    – Luuklag
    Oct 26, 2022 at 11:38

You still need to have a bank account to buy cryptos. Unless you are mining them, the standard way to get cryptos is to buy them from some exchange either via wire transfer or credit card.


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