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Initially there was a chicken and egg thing. People were not spending bitcoins because there were no merchants to spend their bitcoins at. Merchants were not accepting bitcoins because people were not spending bitcoins.
Now BitSpend comes out and allows you to spend bitcoins on anything on the Internet. For me, I used to go search for Bitcoin merchants before I purchased something online. Now I just go search for the best deal online and buy it through BitSpend.
In theory, as long as MtGox will exchange my government currency for bitcoins and BitSpend will convert my bitcoins for products, and miners mine to keep Bitcoin going, then Bitcoin can be used as a currency.
Sure, it would be nice for the Bitcoin economy if the consumer and merchant used bitcoins, but as a consumer, I get what I need out of the deal.
The fee to use BitSpend is certainly not ideal, but they will be coming out with a $5/month subscription service to use it which is quite fair.
So, can we stop worrying about "X company now accepts Bitcoin!", since pretty much every company on the Internet now accepts Bitcoin?
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Seems like we will be mired in the $150s for a long time...
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===OPERATION SHOCK AND AWE ===Date: Monday 2013-04-22 ===Start time of event: 15:30 UTC ===Goal: Bring bitcoin price < $30 US dollars http://www.reddit.com/r/Bitcoin/comments/1cu4ck/ridiculous_ddos_operation_set_up_for_monday/DDOS prevention is pretty limited these days, I wish there were better solutions than cloudlfare, they do not seem to be cutting it. I am worried that once my site is up I will have to deal with the same stuff and am not sure how to handle DDOS. |
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With the amount of success BitSpend is having with just paying for things for people in cash in exchange for bitcoins, how much of a stretch would it be for someone to come up with an easy bill pay system where they just send out checks in exchange for bitcoins?
It seems even easier than what BitSpend does. Someone puts in a name, address, account number and amount. They pay the bitcoin amount and a check is printed out for the business to send out.
Could easily do it like bitspend charging for different prices or have a subscription service.
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Do you believe Bitcoin will rise while the dollar falls? If so, the price of bitcoin reaching $10,000 by the end of 2016 is not that huge of a leap (1000+% gains on average for the past 4 years means over $10k/BTC by 2015). If you bet just .5 BTC (about $60 at current rates) on this: http://betsofbitco.in/item?id=1532it is like an investment in your future. When the bet is won, you will likely at least double your money since so many people believe it will not reach $10,000. So if you win you will get back at least $10k worth of bitcoins. If you lose, you are out 60 bucks. And the earlier you bet, the larger the cut of the winnings you receive. So betting now will give you more than those that wait. Easy money. |
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Western Union Co. and MoneyGram International Inc. are studying ways their customers could use their services to send and receive money transfers denominated in bitcoins, the companies' executives say. "If Bitcoin continues to grow and the value is defined more internationally, we may find an opportunity for Bitcoin to be used to pay for commerce transactions through a Western Union business solution," said David Thompson, an executive vice president and chief information officer of Western Union. "We've been contacted by folks who are doing various things in this space to see if there's opportunities for us to help enable greater functionality for some of these [Bitcoin companies]," said Peter Ohser, MoneyGram's senior vice president of U.S. and Canada. "But we've not committed and don't have any imminent plans to announce anything." http://online.wsj.com/article/SB10001424127887324493704578431000719258048.htmlFull article: The fervor over the digital currency Bitcoin has drawn interest from two of the world's largest movers of money.
Western Union Co. and MoneyGram International Inc. are studying ways their customers could use their services to send and receive money transfers denominated in bitcoins, the companies' executives say.
Both companies run remittance networks commonly used by immigrants to send money to friends and family members in foreign countries. Western Union also operates a business-solutions unit that helps companies send payments to other businesses.
The firms have no immediate plans to add Bitcoin to the more-than-100 currencies in which each company processes transactions. But both say the increasing popularity of the virtual money has prompted them to consider whether they should make it available in the future.
"If Bitcoin continues to grow and the value is defined more internationally, we may find an opportunity for Bitcoin to be used to pay for commerce transactions through a Western Union business solution," said David Thompson, an executive vice president and chief information officer of Western Union.
The Englewood, Colo.-based company is primarily exploring ways its commercial customers may want to use bitcoins, Mr. Thompson said.
Bitcoin is the name for the peer-to-peer payments system that allows people to pay each other from virtual accounts accessed online and on mobile devices, as well as being the term used for units of the digital currency itself. Launched in 2009 by a developer whose identity remains undisclosed, the digital money isn't backed by any central governing body, such as the Federal Reserve, and allows users to remain mostly anonymous—save for their "Bitcoin address"—in transactions.
Buzz around Bitcoin has grown in recent weeks because of wild swings in the currency's value, driven by economic turmoil in the euro zone, outages at the largest Bitcoin trading exchange and U.S. Treasury Department guidance stating money-transmitter rules that apply to the likes of Western Union and MoneyGram also apply to exchanges and sellers dealing with the digital currency.
"We've been contacted by folks who are doing various things in this space to see if there's opportunities for us to help enable greater functionality for some of these [Bitcoin companies]," said Peter Ohser, MoneyGram's senior vice president of U.S. and Canada. "But we've not committed and don't have any imminent plans to announce anything."
While MoneyGram currently has no direct relationships with Bitcoin companies, its money-transfer agents can already help people complete the purchase of bitcoins if they have made arrangements in advance with a payment-processing company called BitInstant LLC.
BitInstant has a deal with a company called ZipZap Inc., which in turn has a relationship with MoneyGram to allow consumers to pay bills and purchase goods from online merchants with cash. That means a BitInstant customer can place an order for bitcoins on its website and then complete the transaction at a participating MoneyGram location with cash, the same way they would pay a bill.
The bitcoins purchased through such transactions can't be used to make a MoneyGram money transfer; rather, they are added to a person's BitInstant account, allowing the person to move the bitcoins to trading exchanges and other companies that accept the virtual currency.
Because a large portion of Western Union's and MoneyGram's customers initiate or receive remittances in cash, new digital payments services are often viewed as threats to their business. But in its current state, Bitcoin doesn't pose much of a threat, executives and analysts say, noting that the currency isn't widely accepted as payment and its value is extremely volatile, limiting its appeal.
So far in April, the value of one Bitcoin unit has ranged from $50.01 to $266, according to bitcoincharts.com. The Bitcoin market is valued at $1.03 billion, according to the site.
MoneyGram's Mr. Ohser noted that bitcoins are of limited use to many of the company's customers. About 95% of consumer money transfers done through its agents involve senders and receivers using cash.
"Remittances go to pay for housing and for food and for maintaining your family," he said. "If you're sending to a rural part of Mexico, my guess is that the merchant is not going to be accepting bitcoins. They want pesos."
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So the latest craze of the government media is to attack Bitcoin for its volatile price with regards to Federal Reserve Notes. One article I just read stated that the price went from $40 to $266 and back to $40 within days.
So, why does this or does this not matter for someone who actually uses Bitcoin as a currency?
Two people: Dollar spender and Bitcoin spender. Both get paid in dollars.
Dollar spender:
Friday pay check - $2,000. It goes into his account and he spends half on bills and reserves the other half for spending.
Wednesday - buy $200 boots online
Thursday - buy $400 stereo online
Sunday - buy $200 computer monitor
Total spent for the week: $2,000
Bitcoin spender:
Friday pay check - $2,000. It goes into his account and he spends half on bills and sends the other half off to the exchange.
Monday morning - converts $1,000 to X bitcoins at Y price.
Wednesday - buy $200 boots online (price went down to Y/2, costs $400 worth of his original BTC)
Thursday - buy $400 stereo online (price went up to Y*2, costs $200 worth of his original BTC)
Sunday - buy $200 computer monitor (price up for the week the average weekly gain of 10%, Y*1.1, $182 worth of his original BTC)
Total spent for the week: $1982
Think of a casino who puts a roulette table out. One player plays 5 rounds at $10 each bet on red. He may hit it big, he may lose it all or somewhere in the middle. Either way, it is unpredictable. Why would the casino owner put out such a volatile game? Because 5000 people putting $10 on red each day would end up with the house advantage averaging out to a couple percent per bet.
If you convert each paycheck to bitcoins and spend as you would your regular dollars, if you understand dollar cost averaging, any fluctuation evens out over time. And the fact that Bitcoin is a deflationary currency that gains in value, it means that the value of your money will gain a slight percentage over time as opposed to fiat money which is purposefully inflationary.
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I am currently in Afghanistan but my mother is taking care of my dogs. My mother is retired so I do not want her to have to spend a lot of money on the dogs so I take care of their expenses. I am also making a bit more money than I used to so I can stop giving them the processed nasty food (that is probably contributing to my dog's alergies and itching). So I decided to get them some good healthy organic dog food with no preservatives. After checking out different companies I decided to try http://www.orijen.ca/ brand dog food. Their site has a list of online vendors. I went to their online vendors and found the one with the best price and free shipping. I found the dog food I wanted. Copied the product page link. Pasted the link into the easy form at http://www.bitspend.net and put my mother's address in there and placed my order. A few hours later bitspend got back with me and gave me an invoice with a bitcoin payment link. I clicked on the link and paid with my bitcoin client. Quite simple, order placed and my dogs get some quality dog food. I did not need to search for bitcoin merchants, I could go with the best product I could find on the Internet. No more need to spend dollars on the Internet anymore. |
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There are many people frustrated with figuring out how to get into bitcoins. It has been shown that people who use PayPal would be willing to spend more per BTC than those going through the exchanges.
The main reason people will not exchange bitcoins via credit cards is because of chargebacks, you could give someone your bitcoins after they pay with a credit card only to have them disappear with your BTC and get their money back onto their card leaving you with nothing.
Most credit card companies have different time scales for different charge backs, the longest being 120 days (from a quick check on Visa).
So, what if we had an exchange that allowed you to pay with a credit card and when you do the purchase the exchange buys bitcoins on your behalf but holds them for you for 120 days. What you receive instead is a bitcoin equivalent credit or colored or slightly transparent coin (however the site wants to do it).
But what you can do with these coins once you get them is trade them on that exchange. Based upon the amount of time that has passed from the time you bought them to the time they actually get switched out for real bitcoins they will vary in value based upon what people are willing to pay.
Say bitcoin is $100/BTC. You go to pay with your credit card and pay $100 (plus credit card fees). You buy 1 BTC for $100. The site buys 1 BTC at $100 and pegs it to your purchase and gives you a red 4 month coin.
You notice on the site that someone is willing to trade .8 bitcoins for a red 4 month coin. You need the bitcoins for something else so you do the trade.
Now the guy with the red 4 month coin holds the coin for a month so it is now an orange 3 month coin. He notices that someone is willing to trade .8 light green 2 week coin for an orange 3 month coin. He has a bitcoin hosting service payment coming up in 2 weeks so he makes the trade.
He waits 2 weeks and the light green coin turns dark green until the final day of the 120 days it turns into a solid bitcoin which the site then transfers to the holder of the coin. He can now take the coin out and use it in his wallet for whatever he wants.
The original person could have waited the 120 days to get the one bitcoin as well.
But people would be motivated to trade based upon the risk of someone doing a charge back. You could even have credit ratings for each person based upon amount of trades and if they have ever done a charge back.
It would allow for easier entry into using bitcoins on the trading side allowing people to pay extra to use their credit card to buy bitcoins (users could be willing to trade their full bitcoin for 1.2 red 4 month bitcoins from an AAA rated seller for example).
Thoughts?
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We will reach 21 million bitcoins around 2140.
More than likely by then we will have colonies on Mars.
So the big problem before the need to worry about fees or reaching the maximum amount of bitcoins is.
How do we deal with people on Mars using Bitcoin?
(This question is as legitimately discussed now in 2013 as discussing how to handle mining in 2140.)
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Current mining: Difficulty: 7,672,999 62,172.58 GH/s 969.89 megawatt hours $145,483.85 / day 3600 bitcoins created / day $145,483 / 3600 = $40.41 If you want fundamentals. You cannot charge less for a product than it takes to produce. But for every product you buy you have to consider: cost of production + cost of distribution + cost of retail + cost of marketing at the very least. Price rarely dips below difficulty for this reason.  |
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This is the official thread for listing other exchanges and the steps required to get your fiat in and out of the exchange. I will start. BitFinex http://www.bitfinex.comDeposit with: Bitcoin (free) Wire Transfer (your cost will vary, typically $10-$35) Withdraw: Bitcoin (free) Wire Transfer (  ) Other: Allows lending, margin trading (short, long) ------------------------------------------------- I will add as you post. |
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Welcome to Bitcoin. Now that MtGox is not trading for a while, maybe it is a good time to learn a little bit about what you invested in: The White Paper http://bitcoin.org/bitcoin.pdfHopefully after you are done investing you will consider trying out the Bitcoin currency. |
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A decentralized exchange would require each person converting dollars to Bitcoins or the other way around to become a registered currency exchanger according to FinCEN. This comes will $millions in fees.
Gotta love government created monopolies.
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It is morning(ish) in China. They get to take away all of your cheap bitcoins you sold.
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Well, if we made it to $266 then maybe I was wrong and the market is growing enough to sustain the growth.
Followed by a mass sell off by all. |
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Where is Paul Krugman when we need him? Is Bitcoin still a deflationary currency?
Or will the price continue to drop like the dollar and the Bitcoin economy will flourish?
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As Bitcoin overcomes every little thing thrown at it, it only strengthened people's resolve.
So the only flaw that they could come at us with was that the price was in a bubble and that it would crash.
Well...pop goes the weasel.
When we return to new highs in a day or so...that will be it. What will you have to throw at Bitcoin then?
Another bubble that will be recovered from shortly thereafter? Yawn.
I wish I was able to buy a bit more to take advantage of this but this thing is going nowhere but up.
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