10 minute confirmation - no in-person currency?

[kaoD]

Block generation averages 10 minutes and difficulty is adjusted to match that speed, right? That means that buying thing in person will take at least 10 minutes to be confirmed once. Does that mean the Bitcoin will NEVER be an in-person currency? Am I missing something? Will the protocol possibly be modified for this purpose or Litecoin is there to fill the gap?

[kaoD]

Personally, I would be comfortable with 0 confirmation transactions up to a thousand dollars.

Why would you? Some businesses live of high-volume low-value transactions (grocery stores, bookstores, etc.) I'm sure they care if you pay or not.

Unfortunately "I wouldn't care personally" is not a solution and this is a tough barrier for in-person merchants to adopt Bitcoin.

I wouldn't even trust a guy showing me his mobile-wallet. It could be just a facade that does nothing behind the curtains.

[odolvlobo]

As I understand it, double spending is not easy even with 0 confirmations. To successfully invalidate the real transaction by double-spending, you have to make sure the bogus transaction is accepted by miners before the real transaction is received (so that the real transaction is rejected). Since the merchant's wallet software is on the network, it will probably see both transactions, too.

[Aahzman]

If i'm meeting someone for a face-2-face trade/transaction, I think it's reasonable to have them sit down and have a coffee wherever we happen to be at to wait for a confirmation.

[AnonyMint]

Why would I be comfortable accepting 0 confirmations transactions for stuff I'm selling? Because I don't think double spends are all that common. Plus people are less likely to rip you off in person.

With the global economy heading into the toilet (after 2017 comes the hard down phase), people may become very desperate.

Thievery may be a way to survive.

I would prefer if there is a way to fix the problem (but there may not be).

As I understand it, double spending is not easy even with 0 confirmations. To successfully invalidate the real transaction by double-spending, you have to make sure the bogus transaction is accepted by miners before the real transaction is received (so that the real transaction is rejected). Since the merchant's wallet software is on the network, it will probably see both transactions, too.

There is no guarantee that the merchant's internet connectivity reliability and P2P fanout gets it in sufficient time.

It would be nice if there is some cryptographic way to lock a key w.r.t. to another key to create another key when spending it. Probably not as that doesn't shift the problem from needing a fixpoint (an absolute point-of-reference (the P2P DB)). Searching for other ideas.

[kaoD]

If things are that bad, honest people won't mind waiting for a confirmation or two.

Or they'd rather buy with dollars and take the goddamn newspaper and packet of cigarettes in less than 10 minutes

[fractal5]

Block generation averages 10 minutes and difficulty is adjusted to match that speed, right? That means that buying thing in person will take at least 10 minutes to be confirmed once. Does that mean the Bitcoin will NEVER be an in-person currency? Am I missing something? Will the protocol possibly be modified for this purpose or Litecoin is there to fill the gap?

It takes a bank what a minimum of two business days for an electronic check? Ultimately if there is internet access then you could get a clearing company to guarantee those 10 minutes. In that case you leave your spending money in with a centralized Bitcoin bank network.

[AnonyMint]

kaoD, LOL

I have contemplated that one way to reduce the threat of double-spending is to put in the protocol that all peers will record the funds as confiscated to the ether if there is an attempted double-spend.   Remember only the owner of the private-key can issue a duplicate.

I also have another idea, but the one above may be sufficient.

I regularly "think out of the box".

[AnonyMint]

We were talking about the global economy heading into the toilet? I guess if you like hauling around wheelbarrows full of cash, go for it. If merchants still accept cash at that point, of course.

It will be deflationary, same as for 1929 - 1939. The inflation that came during WW2 was due to scarcity as everything was used in the war.

Gold will go up to due to chaos, not due to hyper-inflation.

Hyper-inflation never occurs on a global-wide basis and never in the reserve currency, because the banksters always need a currency to hold their loans in when they hyper-inflate away a localized currency. Martin Armstrong explained it very well. Wait I will go find the blog post.

They will steal all the bonds, retirement funds, etc.. That is where the money will come from. Deflationary.

[AnonyMint]

I have contemplated that one way to reduce the threat of double-spending is to put in the protocol that all peers will record the funds as confiscated to the ether if there is an attempted double-spend.   Remember only the owner of the private-key can issue a duplicate.

Now I remember why I had dismissed this before. The payer can simply spite you, for no gain to himself.

But there may be a way to resolve this. For immediate transactions, the payer posts some extra BTC as guarantee he won't double-spend. These are held for a period of time (say 6 blocks), then released.

[DannyHamilton]

Why would you? Some businesses live of high-volume low-value transactions (grocery stores, bookstores, etc.) I'm sure they care if you pay or not.

And yet they accept credit cards, debit cards, and personal checks (some even accept paypal!), all of which take more than 10 minutes to become irreversible and avoid fraud.  Apparently most businesses are willing to accept a small amount of risk in the interest of increased transaction count and convenience.  Fortunately bitcoin becomes irreversible far faster than the convenience payment systems that many of them are accepting currently.

Unfortunately "I wouldn't care personally" is not a solution and this is a tough barrier for in-person merchants to adopt Bitcoin.

Not for those with any intelligence or understanding of what risk they are already accepting by not accepting bitcoin.

I wouldn't even trust a guy showing me his mobile-wallet. It could be just a facade that does nothing behind the curtains.

Absolutely not, but as long as I had a well connected wallet of my own, if I saw a transaction on the network that included a reasonable fee and after a few seconds still hadn't seen any competing double-spend transaction, I'd trust it far more than any credit card, debit card, paypal, or personal check.

[kaoD]

Sorry fractal5 but I specifically meant Bitcoin as a replacement for in-person money (cash). Though your statements are true, they are really not relevant (or I might have misinterpreted your post).

BTW, very interesting thread, views and ideas.

[BTCisthefuture]

I believe in the future we will need something like we currently have with checks.  You can go buy goods with a check even though it's not comfirmed you actually have the money. In the case of a check it can take a few days to clear sometimes.  The solution to this problem is that if a check bounces you get hit with some hefty fee's in your bank account. If too many checks bounce it then becomes a criminal matter for which you can get in pretty big trouble for.

In the future I feel like there will need to be some sort of banking system/account tied into btc for it to be a realistic option for buying things in person. Maybe some sort of debt card or something, and a system similar to checks where if something goes wrong down the road you are hit with penalities or face legal trouble.

We aren't there yet, but hopefully in the future someone/some people come up with something to solve this problem.



Like someone else mentioned though, as far as BIG purchases go, i doubt most people would mind waiting 10-20-30 minutes for confirmation.

[AnonyMint]

Why would you? Some businesses live of high-volume low-value transactions (grocery stores, bookstores, etc.) I'm sure they care if you pay or not.

And yet they accept credit cards, debit cards, and personal checks (some even accept paypal!), all of which take more than 10 minutes to become irreversible and avoid fraud.  Apparently most businesses are willing to accept a small amount of risk in the interest of increased transaction count and convenience.  Fortunately bitcoin becomes irreversible far faster than the convenience payment systems that many of them are accepting currently.

This losses (reversals) are passed on to all customers in the form of higher prices.

And I certainly don't want to accept credit cards at my garage sale.

And many POS purchases are debit cards, which do not reverse typically, because they don't spend if account is below balance. I realize there are a few exceptions, but less so than for credit cards.

And the point is to replace cash, so I can swipe or press a button on my mobile phone and pay anyone any where, even they don't have a merchant account.

So as I said, it would be better to fix the problem, and I offered a technical solution, to make transactions instantaneous.

[TheBigYak]

I believe in the future we will need something like we currently have with checks.  You can go buy goods with a check even though it's not comfirmed you actually have the money. In the case of a check it can take a few days to clear sometimes.  The solution to this problem is that if a check bounces you get hit with some hefty fee's in your bank account. If too many checks bounce it then becomes a criminal matter for which you can get in pretty big trouble for.

In the future I feel like there will need to be some sort of banking system/account tied into btc for it to be a realistic option for buying things in person. Maybe some sort of debt card or something, and a system similar to checks where if something goes wrong down the road you are hit with penalities or face legal trouble.

We aren't there yet, but hopefully in the future someone/some people come up with something to solve this problem.



Like someone else mentioned though, as far as BIG purchases go, i doubt most people would mind waiting 10-20-30 minutes for confirmation.

The issue with this is that it seems one of the core tenets of BitCoin is the distributed nature, which would make it difficult to have any system to enforce fees.  I could see perhaps the implementation of a funds "holding" extension that allows you to pre-verify the existence of certain funds and lock them for a specified period of time.  Think like an authorization on a credit card: when you go to pump gas, the pump authorizes some set amount (maybe $75), and then the transaction then later "clears" and the amount up to the $75 is then removed.  If no clearing transaction is processed, the funds auto-release after a specified period of time (typically 3 days).  I don't know if the BitCoin protocol currently supports what would be needed for this, but it seems like a reasonable way to address the problem. 

A related approach would be using the above idea of fees, but basically do the "authorization" against the fee account to make sure you could at least afford to pay the fee if you didn't complete the transaction.