Potential obstacles for mass adoption of BTC

[johnyj]

As long as government exists, there will be taxation. Since any major merchant/producer have a reviser, and they have a balance sheet and inventory list, they will not be able to pass the declaration inspection, even if they use BTC as the only method of transaction, BTC can not be formally accepted in any accounting systems known of today

If government want to put some limitation on BTC, they can also do some block on the major IP backbone, so that BTC protocol's port get blocked

I think the first big success for BTC will be happened on a tax heaven where there is no regulation on economy activities

[1714923767]

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[Deafboy]

You can always sell them as soon as you get them and record the value in your national currency. I see no big problem here. If there is enough volume in future, the laws and regulations will be created to make bitcoin accounting possible.

[SuperHakka]

Biggest obstacle is gaining the trust of the people at large. Not easy if you consider what's happened and how easy it will be for big corp mass media to spin things against bitcoin.

[BladeMcCool]

maybe keep a completely separate encrypted inventory list and books for things that are being accounted for in bitcoin?

[CIYAM]

I think that in many "western" countries taxation itself has been moving from income tax to consumption tax (making it more relevant how you spend your money than how you earn it) and at the same time banks have been tending to report all account tx's to tax bureaus (and will generally withhold a large percentage of interest payments without customers providing their tax reporting information).

This tends to make it actually not difficult at all for governments to tax people who convert BTC to their local currency (via a bank transfer) and looking at the identification requirements that many of the BTC exchanges are requiring I can't see how people can in any way easily avoid government scrutiny with any serious amounts of money.

Basically if you are using an exchange to convert a large amount of BTC to any fiat currency then I think the chances of avoiding detection (and thus taxation) by the government is rather small.

P.S. In regards to SR perhaps the whole "war on drugs" could simply be turned into another profitable sales tax by legalization.

[hazek]

As long as government exists, there will be taxation. Since any major merchant/producer have a reviser, and they have a balance sheet and inventory list, they will not be able to pass the declaration inspection, even if they use BTC as the only method of transaction, BTC can not be formally accepted in any accounting systems known of today

If government want to put some limitation on BTC, they can also do some block on the major IP backbone, so that BTC protocol's port get blocked

I think the first big success for BTC will be happened on a tax heaven where there is no regulation on economy activities

Completely invalid since accepting bitcoin is sort of like bartering in the eyes of governments, and barter is already taxed (in case you didn't know). If they can tax and enforce taxation on barter, I don't see why they couldn't do the same with bitcoins (not that I support this heinous thievery).

[davidspitzer]

My personal 2 cents is the complexity of use is the biggest barrier for most. What seems second nature to most on this forum would be a daunting task for most. I think a large part of this complexity is due to the extra ordinary precautions that one must take in order to secure their wallet from theft. The conversion from Fiat Currency and back again is also an involved and sometimes nerve racking process.

The currency exchange and wallet process needs to be revamped in my opinion or BTC will remain with ranks of technophiles only. I have introduced BTC to others in my family and among my friends and the majority have difficulty grasping the nuances and complexities needed to manage this type of currency.

Even the mining process involves undo complexity in my opinion. The model for ease of use, which I believe needs to be pervasive throughout the system, can be seen in the likes of the Bitminter client. The average consumer has very little patience for complexity and will gladly sacrifice features and flexibility for solid performance and repeatable experiences. (E.G. McDonald's, Apple etc). Ultimately, I believe, that the BTC community must transform from a cloistered technology community to that of a customer service focused business model; which puts the average consumers needs as the first priority.

[CIYAM]

Ultimately, I believe, that the BTC community must transform from a cloistered technology community to that of a customer service focused business model; which puts the average consumers needs as the first priority.

I think this is very true - and I don't think governments have anything to worry about Bitcoin when it comes to that (as average consumers are already happy to give out all of their personal information to use credit cards anyway).

[davidspitzer]

Ultimately, I believe, that the BTC community must transform from a cloistered technology community to that of a customer service focused business model; which puts the average consumers needs as the first priority.

I think this is very true - and I don't think governments have anything to worry about Bitcoin when it comes to that (as average consumers are already happy to give out all of their personal information to use credit cards anyway).

I gave up on the whole notion of online privacy years ago - I believe the only effective online privacy is not to be online. I like being online so I accept that everything I do or say can potentially be seen and used by others, so I try to conduct myself accordingly. I safeguard those things that are vital with perhaps an overzealous degree of flair (my wallet is on a stand alone double encrypted drive with a password that exceeds 30 character in length), the rest I don't worry about. I have a hard time envisioning most people I know managing a bootable truecrypt drive just to protect their Bitcoin wallet. Some standardized, easy and safe way must be devised before the "masses" will even give it a try.

[SuperHakka]

I gave up on the whole notion of online privacy years ago - I believe the only effective online privacy is not to be online. I like being online so I accept that everything I do or say can potentially be seen and used by others, so I try to conduct myself accordingly. I safeguard those things that are vital with perhaps an overzealous degree of flair (my wallet is on a stand alone double encrypted drive with a password that exceeds 30 character in length), the rest I don't worry about. I have a hard time envisioning most people I know managing a bootable truecrypt drive just to protect their Bitcoin wallet. Some standardized, easy and safe way must be devised before the "masses" will even give it a try.

ya and it will only take one or two grannies and housewives to get their wallet nicked for the media to decry what a scam and how unsafe bitcoin is. Believe this people.

[davidspitzer]

I gave up on the whole notion of online privacy years ago - I believe the only effective online privacy is not to be online. I like being online so I accept that everything I do or say can potentially be seen and used by others, so I try to conduct myself accordingly. I safeguard those things that are vital with perhaps an overzealous degree of flair (my wallet is on a stand alone double encrypted drive with a password that exceeds 30 character in length), the rest I don't worry about. I have a hard time envisioning most people I know managing a bootable truecrypt drive just to protect their Bitcoin wallet. Some standardized, easy and safe way must be devised before the "masses" will even give it a try.

ya and it will only take one or two grannies and housewives to get their wallet nicked for the media to decry what a scam and how unsafe bitcoin is. Believe this people.

You are unfortunately very correct. Until the design can virtually guarantee, absent gross negligence, the safety of your wallet and ease of currency transformation, we will be stuck in our little world of our own making.

[CIYAM]

You are unfortunately very correct. Until the design can virtually guarantee, absent gross negligence, the safety of your wallet and ease of currency transformation, we will be stuck in our little world of our own making.

All very true - but to be a little more positive there has been quite a bit of work on improving this (multi-sig being perhaps the most significant achievement even though still not yet user friendly).

Give it some time and I think the solutions will be coming.

[Vladimir]

The biggest obstacle? Infinite stupidity, of course!

[greyhawk]

Vlad, get your reporters on that GLBSE thing happening right now. This has potential to be a huge scoop.

[CIYAM]

The biggest obstacle? Infinite stupidity, of course!

Do you really expect your grandmother to understand ECDSA (and I admit I have only a basic understanding of this myself) in order to hold on to her money?

(not trying to be offensive but I think it is important that we don't expect the "end users" of Bitcoin to all be so computer/algorithmically literate)

but perhaps you are instead referring to ponzi schemes

[HorseRider]

OK, we need just the black market and an offshore bitcoin currency exchange.

[davidspitzer]

The biggest obstacle? Infinite stupidity, of course!

Do you really expect your grandmother to understand ECDSA (and I admit I have only a basic understanding of this myself) in order to hold on to her money?

(not trying to be offensive but I think it is important that we don't expect the "end users" of Bitcoin to all be so computer/algorithmically literate)

but perhaps you are instead referring to ponzi schemes

I agree completely. Being condescending to someone with less computer skills is probably not a "feel good" adoption marketing strategy. I have been working in the computer field (for many) years. There are still facets of Bitcoin that I find challenging. I see a lot of strides being made and that is good, but the most important piece is the "attitude" we take towards people like Grandma, or our friend who still has a flip phone etc.

If we treat people with contempt and disdain because they do not understand as much about computers as we do, then widespread adoption will be hard pressed. People are not stupid merely because they do not understand computers as well as some; they often have skills that are focused in other areas. My father is a mechanical engineering genius, but has never really used a computer for much in his life. I can only aspire to be as smart as he is. He laughs when I can not do complex math in my head and He is amazed at my skills with computers. We all have different talents. The key here is make a system that will enable the largest demographic, as reasonable, to take advantage of Bitcoin as a currency. I am excited to see some of the developments I have read about coming to fruition. I would not be investing money and mining Bitcoin if I did not fundamentally believe that it is capable of widespread adoption.

[Come-from-Beyond]

The biggest obstacle? Infinite stupidity, of course!

I'm downloading the blockchain right now, it seems to be "more infinite" than stupidity. And this is the biggest obstacle.

[CIYAM]

Being condescending to someone with less computer skills is probably not a "feel good" adoption marketing strategy. I have been working in the computer field (for many) years. There are still facets of Bitcoin that I find challenging. I see a lot of strides being made and that is good, but the most important piece is the "attitude" we take towards people like Grandma, or our friend who still has a flip phone etc.

Yup - very important - my math skills suck yet I am able to build a complete web site in C+ (with no scripting apart from some UI stuff) in minutes.

I was amazed to find out recently that my nephew has a Rasberry Pi when I had never even heard of such a thing before - trying to say that Bitcoin belongs to some sort of "ultra geek club" will never help the general adoption of Bitcoin - but good software will.

In regards to the blockchain download - yes that is a problem (but you can download it as a set of files and there are other clients that don't need to use it).

[Vladimir]

The biggest obstacle? Infinite stupidity, of course!

I'm downloading the blockchain right now, it seems to be "more infinite" than stupidity. And this is the biggest obstacle.

hmm.... perhaps someone needs to set up "donwload 1 hour old blockchain in 5 minutes" service... steal this idea.