Bitcoin Forum

In a recent article http://tomorrowstransactions.com/2014/05/bitcoin-wasnt-designed-for-retail-payments/ (http://tomorrowstransactions.com/2014/05/bitcoin-wasnt-designed-for-retail-payments/) Dave Birch expresses his views on if Bitcoin will ever be viable for retail payments.  There are many challenges and of course it is like throwing flames on oil in here.

Dave bring up some good points on the current challenges but he misses the fact that the underbanked would like an alternative for one. He does address that part of the issue is the payment processing.  People want it to be as easy as swiping or a touchless card transaction at a POS. 

What are your thoughts on Dave's article?

It already is happening. I disagree with a lot of what he said and his reasoning behind it.


Why can it not be both? It's a win-win situation either way.

Skimmed it. Seemed to present a single anecdote about an issue with wallet-software as representative of bitcoin being fundamentally unfit for retail transactions. Pretty myopic point of view.

Further, at the end he references the technology, not the currency, having value. This is a core misconception that's been getting tossed around lately as more and more people who probably previously derided bitcoin completely are now being forced to at least acknowledge that the tech is innovative and disruptive. But they try to save face by saying "but bitcoin as a currency is suspect".

They're either being disingenuous, or they simply haven't figured out that the currency and the tech/network are one cohesive thing. If the latter is useful, the former has value. That's it. You can't dissociate the scarce unit of account asset on the network and still expect the network to be useful. Any way you try and do so requires a centralization layer (eg, if someone says "oh, let's use a crypto-coin system to send dollars, or gold, or oil...). Dissociation requires centralized backing/pegs/guarantees, and that completely breaks the utility and uniqueness of the entire system.

The currency and the network are one and the same. The sooner people come to accept this, the better.

After a recent audit, BitPay is reporting ~$1Mil/day in transaction via their payment gateway.

http://www.coindesk.com/bitpay-now-processing-1-million-bitcoin-payments-every-day/

@ that rate, it's ~$350Mil/year

It's only tiny for the moment, but most of us Bitcoin investors believe High Street merchant adoption is likely to increasing over the next 3 years.

I am currently running BTC business in the UK. For the sale of goods and services 20%VAT must be accounted for.

Although no VAT is owed for the transfer of BTC itself. Working with accountants at the moment, most agree ~32% (20% Income Tax, 12% National Insurance Tax) of my profit margin should be accounted for annual Tax liability. This is the case operating as a sole trader.

We may change to incorporation as a Ltd company, reducing our annual Tax liability to ~23% if turnover justifies.

I think the largest challenge for BTC businesses within the UK currently is finding a banking partner.

Barclays and HSBC are definate "no-goes" at the moment. Smile, Co-operative, Citi Group and Lloyds Bank are the only one's playing the field, and it depends on what your business model is.

Just a year ago they were calling it tulip bulbs. Now they are moving the goal posts again. They will be the ones left behind when the train leaves. 

you can use bitcoin for most retail places that accept debit in canada now
using cavirtex's bitcoin to cadollar instant conversion debit card.

While I was encouraged by the original traction of bitcoin in Canada didn't the Canadian government say that is was not a currency?  As such Virtex is operating in a limbo status until the Canadian's decide on any other position on Bitcoin.

I will say this is a good concept in general however.

Are you blind? There are already thousands of merchants accepting btc. This is not an overnight thing. Infrastructure is still not there yet, but keep in mind crypto currency is only a few years old.

I think part of what Dave was saying is that today actual retail transactions at a brick and mortar shop is very low because 1) the infrastructure is lacking and 2) there are just easier ways to pay.

The volume we are seeing as a currency in BitPay and others is primarily for web-based e-commerce transactions.  Every transaction that BitPay processes for GYFT is actually just a trade to another form of currency and method of payment.  Why do they sell lots of gift cards through bitcoins - because people can't use bitcoins at those merchants.  So again all of that volume is really not retail volume.

I  have yet to see any reasonable merchant volume stated anywhere where the transaction with bitcoins is across a counter.  I am not saying it is not early I am just saying Dave has some valid points for where we are today.  Further, the regulatory situation does not help.  Who wants to buy a pizza and track the capital gains on that transaction.

Exactly. Shortcomings of current wallet-software will be resolved by new POS solutions of third parties. Bitcoin will conquer retail. But it'll take more time than e-commerce.

Bitcoin is not ready for mass adoption yet. But progress is accelerating.

I use my BTC in brick & mortar stores regularly. It is happening! 

Until opensource POS software becomes available, i don't see wide adoption. My local Pizza guy asked me about Bitcoin, and i had to tell him that i didn't know how to impliment it for his business short of a total custom solution which might be painful to use. :-\

welcome to the year 2010....... oh wait i mean 2014.. sorry i was as stuck in the past as the OP was

30k+ merchants using bitpay

a few thousand using coinbase

a few hundred self managing. i think you'll find it already happened.

We should get some of the owners of shops that are already accepting bitcoins togheter.
And make a video of them and make it like a commercial,
where they tell there income has greatly increased because they sell products for bitcoin.
And where they explain how easy it is with bitpay and how this could benefit them.