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Very interesting.
I wonder why anyone hasn't tried a Silk Road 2.0 (under a different name) without the drugs, murder, and lawlessness.
Of course, there is the idea that the government was coming after the Bitcoin and the threat of Bitcoin to fiat, but I think they would have a much more difficult time taking down a legitimate business just because of Bitcoin use.
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Frank, was the collateral-reputation system on Silk Road for the vendors, buyers, or both?
Also, what if the buyer had to put up collateral until the package safely arrived? Perhaps a certain percentage of the cost of the product would be tacked on to the purchase that the marketplace would hold in case of a package dispute. If a product dispute employee (someone who helps solves vendor/buyer disputes) determines that the buyer is trying to fraud the vendor. The collateral that the buyer put up is transferred to the vendor.
If the package is received, collateral returns to the buyer. If the package was lost or somehow didn't arrive in satisfactory condition, that is a different matter.
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OP, you also don't have the burden of credit card processing fees with Bitcoin, so there is that plus from the get-go. The fees involved with liquidating that Bitcoin into immediately available fiat capital - I have no feel for that.
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Suppose I am doing business through an online Facebook page and website and want to accept Bitcoin. But now if I look at cryptocurrencies it comes with high volatility, and I have doubts whether accepting Bitcoin will be profitable for my business.
I really want to know your opinion on this and what are the initial steps I should take if I adopt cryptocurrency for my business? Because I see many people on the forum are taking steps to accept Bitcoin for businesses and that's why these questions araised in my mind.
OP, I'm sure you know how much liquid capital you need from each transaction to cover costs, inventory, or whatever to keep your business flowing. With that knowledge, I believe there are ways/services to have a certain percentage of a Bitcoin payment/transaction liquidated into a bank account. I believe beef producers with thebeefinitiative.com are able to do this exact thing. Then, you could allocate the rest of the Bitcoin as you wish. Keeping everything in Bitcoin just does not make sense with current volatility, and anyone who says otherwise is crazy. Sure inflation is as bad as it is, but if your company's funds lose 50%+ purchasing power... That's nearly impossible to stay afloat. With your business model, and the suggestion that I outlined above, it would really depend on how great or little your margins are. BUT, I know producers in The Beef Initiative take Bitcoin payment and rancher/farmer profit margins are as narrow as it gets... |
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the issue with marketplaces for goods is not what you might be thinking at first.. its not the centrality. its not even the listing of goods.. its the whole scamming and scheming on both sides
EG
sellers that dont deliver and just run away with the funds..
buyers that pretend goods not received and demand refunds
where they just set up new bitcoin addresses for payments and pretend to be a new business every day, or customers pretend to be different everyday and scam the same seller over and over
things like ebay have buyer protection which makes it harmful to sellers.
other sites have seller protections which makes it harmful to buyers.
but these fiat sites found they needed something to alleviate the fraud/scam risk
but in a system of anonymity and no desire of KYC it becomes a hotbed of people trying harder to scam and scheme a system
market places have a headache with this stuff which is why they charge fee's for offering a listing site. because they become the mediator of disputes about sold goods not being sent or customers saying they didnt arrive where both sides are trying to run off with goods or funds for free
ebay/etsy work better because they are clear accounts with names and addresses and ratings systems where seller get to rate buyers and buyers get to rate sellers where its slightly more difficult to just create reputation if your just going to use a no ID system
it would be great to have a market place where people can advertise goods and novelty gifts to sell. but it requires a highly invested middleman to mediate/escrow deals, so that fair trade can happen with punishments for abusing said deals
All great points franky - thanks for your thoughts. I am tempted to advocate for a process that I believe the notorious Silk Road used. Silk Road had an escrow Bitcoin wallet that would pay vendors once the buyer said they received the good. Obviously this would allow the buyers to scam the sellers. You'd have to come up with a way to stop that fraud. I think a customer/vendor rating system would work just fine. The vendors would not be able to have anonymity, but the buyers could. I am not entirely sure how to stop the buyer from committing fraud, but the vendor would be making more profit per transaction on the Bitcoin network without credit card company fees. Would this outweigh MASS fraud - No. I'm trying to imagine an online market model where the marketplace isn't making money by gauging the vendors with huge transaction/processing fees. |
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Avikz, thanks very much for the link. I have never seen that site. Great, great idea. A gift card allows you to have fiat purchasing power with certain anonymity as well!
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As believers in Bitcoin, we ought to all be running miners ourselves. Now, if only we all had the time and resources for this. Perhaps it can be less difficult than it seems though..?
I have seen engineers on Twitter creating using bitcoin mining units as water heaters, home heating systems, and much more. Just wait until one of these innovative lads has some venture capital money to create practical, functional products that double as bitcoin miner.
We must breed more creativity.
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I believe that it would be for the greater common good if we returned to peer-to-peer transactions for goods. No third parties. Handshakes, and supporting your neighbors. Circular economies. I imagine a site where you can simply pay a subscription as a vendor to be able to sell your goods directly to the consumer in a peer-to-peer transaction with no fees beyond the particular crypto network fee. As the marketplace's administration, you'd obviously have to not have the urge to monetarily gouge your clients.
Would love feedback on this.
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Thank you for the links. I am more so interested in simply the existence of such a marketplace. I think that it could fair well in the Bitcoin-maximalist community...
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Are there any Bitcoin marketplaces that have been developed with similar DNA and design to that of the fiat, online marketplace Etsy? If you are not familiar with Etsy, you can purchase niche and custom items that are generally sold by small businesses or individuals. It's a great avenue to purchase handmade or homemade products, while opting to not spend your money at a big box store. I imagine it doesn't take much to become a vendor/seller on the site, and the buying process is smooth as can be.
Though, summing up all of the fees that Etsy charges, they are essentially taking up to 9.5% per transaction, plus $0.45 USD. That is quite a bit. I'm sure that a much more vendor-friendly version of this could be created with minimal transaction fees - at least in comparison.
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