Bitcoin just wipes the floor with Paypal

[Jocky]

The Usage % is the amount of orders fulfilled, revenue % is the actual amount after fees. That's why there's such a big difference.

Usage % does not normalize how large the purchases were.

For all we know, 80% of Paypal users bought 1 month's worth, and 80% of BTC/CB users bought 2 year's worth. Especially because I think Bitcoin users would be more eager to show their support and exacerbate the results of accepting BTC (through CB), the results don't really mean anything except that Bitcoin usage among customers is insignificant compared to other means.

And without that information, knowing that Coinbase can offer substantially lower fees, why would we conclude anything different than that Bitcoin is cheaper for businesses? Tell me.

[Kluge]

The Usage % is the amount of orders fulfilled, revenue % is the actual amount after fees. That's why there's such a big difference.

Usage % does not normalize how large the purchases were.

For all we know, 80% of Paypal users bought 1 month's worth, and 80% of BTC/CB users bought 2 year's worth. Especially because I think Bitcoin users would be more eager to show their support and exacerbate the results of accepting BTC (through CB), the results don't really mean anything except that Bitcoin usage among customers is insignificant compared to other means.

And without that information, knowing that Coinbase can offer substantially lower fees, why would we conclude anything different than that Bitcoin is cheaper for businesses? Tell me.

We shouldn't conclude anything, because the information sucks.

[ElectricMucus]

What are you trying to say?

Paypal isn't your enemy.

I still have to agree on the fact that Paypal's tendancy to freeze accounts and retract funds that I've truly earned is a consequense of the fact that they are dependent of credit card agencies. The buyer scammer protection has gone to far, I won't wear a dress for Paypal to get my money into my bank account, nor do I want to wait a month for it. The absence of these phenomena are inherent in the Bitcoin system, don't you agree?

They just do what they have to do. It's the legal system and the corruption within it you ought to be concerned about not some company which has to abide it.

[Jocky]

What are you trying to say?

Paypal isn't your enemy.

I still have to agree on the fact that Paypal's tendancy to freeze accounts and retract funds that I've truly earned is a consequense of the fact that they are dependent of credit card agencies. The buyer scammer protection has gone to far, I won't wear a dress for Paypal to get my money into my bank account, nor do I want to wait a month for it. The absence of these phenomena are inherent in the Bitcoin system, don't you agree?

They just do what they have to do. It's the legal system and the corruption within it you ought to be concerned about not some company which has to abide it.

Isn't that the whole point of Bitcoin, to fight that? If you agree with that, which I hope you do, I hope you agree that Bitcoin can solve the problems with which paypal users have to deal every single day.

[ElectricMucus]

What are you trying to say?

Paypal isn't your enemy.

I still have to agree on the fact that Paypal's tendancy to freeze accounts and retract funds that I've truly earned is a consequense of the fact that they are dependent of credit card agencies. The buyer scammer protection has gone to far, I won't wear a dress for Paypal to get my money into my bank account, nor do I want to wait a month for it. The absence of these phenomena are inherent in the Bitcoin system, don't you agree?

They just do what they have to do. It's the legal system and the corruption within it you ought to be concerned about not some company which has to abide it.

Isn't that the whole point of Bitcoin, to fight that? If you agree with that, which I hope you do, I hope you agree that Bitcoin can solve the problems with which paypal users have to deal every single day.

My hunch says there is yet a bigger technological change necessary to change that, bitcoin might play a minor role yes.

I don't really get my hopes up on this, tough.
And some of it is a social problem which cannot be solved with technology.

[SgtSpike]

They have a 32% advantage* with coinbase over paypal when it comes to the price of payment processing.

If anything that shows coinbases pricing is very competitive... they just happen to process bitcoin.

*that does not include bitcoin network fees and exchange slippage though.....

No, they don't.  They brought in 32% more revenue PER TRANSACTION compared to Paypal.  Revenue is income before any expenses, fees, taxes, etc.

The Usage % is the amount of orders fulfilled, revenue % is the actual amount after fees. That's why there's such a big difference.

No, it is not.  Revenue % is the amount BEFORE fees.  Go look it up, and PLEASE stop spreading misinformation when you don't know what you're talking about.  The reason for the big difference is because people using Bitcoin decided to spend more per-transaction than people using Paypal.

That's a false conclusion, bad article, and should be taken down immediately.

All it means is that people paying with Bitcoin are generally paying more per transactions.  In other words, they're buying longer subscriptions, on average, than people paying with other payment methods.

The conclusion that Bitcoin "wipes the floor" with Paypal is just plain wrong any way you look at it (with regards to this particular situation).

I thought it was actual amount received after fees.

Nope.  Revenue is defined as the income received before any expenses, fees, taxes, interest, or other deductions are taken from it.

That's a false conclusion, bad article, and should be taken down immediately.

All it means is that people paying with Bitcoin are generally paying more per transactions.  In other words, they're buying longer subscriptions, on average, than people paying with other payment methods.

The conclusion that Bitcoin "wipes the floor" with Paypal is just plain wrong any way you look at it (with regards to this particular situation).

Where is this coming from? Censoring an article because you get the wrong idea about it's content or purpose?
Bitcoin is very very young, and already it makes up a substantial part of the Reddit Gold payments, that's something to be proud of.
Paypal has has more than 10 years to become a convenient payment processor, and they were beaten by Bitcoin in a few years.
Whether your opinion is the same or not, my mind is set. Bitcoin doesn't require a fraction of the fees Paypal does, Bitcoin is faster and has a lot more potential in brick & mortar companies than paypal does, and that in it's premature fase. While Paypal is still ripping off users every day.

Say what you want, but don't claim an article has to be taken down immediately because you can't understand it's purpose. Or at least change your profile pic to two large S's

It's coming from the fact that the article is dead wrong in its understanding about what revenue is.  The author doesn't comprehend basic financial terminology, and shouldn't be writing about financial information without first familiarizing himself further with said terminology.  See my above responses for why the reported information from reddit has nothing to do with fees and everything to do with Bitcoin users choosing larger purchases over Paypal users.

EDIT:  I just realized that you are the author.  I still advise you take the article down and familiarize yourself with some basics in financials.  Maybe take a college-level course in accounting or something.

[ex-trader]

Paypal vs Bitcoin

As a buyer using Bitcoin

Paypal (or Visa etc) - no fees, with added protection
Bitcoins - no fees, no protection

Why would I ever want to use Bitcoins, it's the same cost, but I lose all the inherent protections against bad goods, or merchants?


As a seller using Bitcoins

Paypal (or Visa etc) - fees down to 1.4%, risk of chargeback/freeze
Bitcoin processing - 1% fees at BitPay, no risks on payments

So as a seller the economic benefit of using BTC is very small indeed, just the small added upside on risk, if I can persuade the customer to take the risk on me!

Conclusion

It's difficult to see that BTC actually changes anything when it comes to selling goods professionally.

Where it does work is in small international payments that are directly peer-to-peer, where it's cost-free structure and speed beats everything, but this doesn't seem to be where people are focussed right now, I guess since there's no point sending BTC to people who don't have the technology to receive it, or the ability to spend it after they receive it.....

[Gabi]

So as a seller the economic benefit of using BTC is very small indeed

Not true, that % may seem small but usually a merchant profit from selling item is a small % of the price he sold the item. So that little change may mean a lot moar profit

[SgtSpike]

Paypal vs Bitcoin

As a buyer using Bitcoin

Paypal (or Visa etc) - no fees, with added protection
Bitcoins - no fees, no protection

Why would I ever want to use Bitcoins, it's the same cost, but I lose all the inherent protections against bad goods, or merchants?


As a seller using Bitcoins

Paypal (or Visa etc) - fees down to 1.4%, risk of chargeback/freeze
Bitcoin processing - 1% fees at BitPay, no risks on payments

So as a seller the economic benefit of using BTC is very small indeed, just the small added upside on risk, if I can persuade the customer to take the risk on me!

Conclusion

It's difficult to see that BTC actually changes anything when it comes to selling goods professionally.

Where it does work is in small international payments that are directly peer-to-peer, where it's cost-free structure and speed beats everything, but this doesn't seem to be where people are focussed right now, I guess since there's no point sending BTC to people who don't have the technology to receive it, or the ability to spend it after they receive it.....

I think we will begin to see merchants offering discounts for payments made in BTC.

[Stampbit]

Paypal vs Bitcoin

As a buyer using Bitcoin

Paypal (or Visa etc) - no fees, with added protection
Bitcoins - no fees, no protection

Why would I ever want to use Bitcoins, it's the same cost, but I lose all the inherent protections against bad goods, or merchants?


As a seller using Bitcoins

Paypal (or Visa etc) - fees down to 1.4%, risk of chargeback/freeze
Bitcoin processing - 1% fees at BitPay, no risks on payments

So as a seller the economic benefit of using BTC is very small indeed, just the small added upside on risk, if I can persuade the customer to take the risk on me!

Conclusion

It's difficult to see that BTC actually changes anything when it comes to selling goods professionally.

Where it does work is in small international payments that are directly peer-to-peer, where it's cost-free structure and speed beats everything, but this doesn't seem to be where people are focussed right now, I guess since there's no point sending BTC to people who don't have the technology to receive it, or the ability to spend it after they receive it.....

I think we will begin to see merchants offering discounts for payments made in BTC.

The discounts are small, and the chargeback issue with credit cards isnt really an issue (as long as you state "no refunds" visa will not allow chargebacks). The real benefit of using bitcoin is protection against censorship and control. Its one thing to say "we'll this will only save me a few points so whats the big deal", its another to have your account funds tied up or blocked entirely because your payment processor felt like it.

[ElectricMucus]

They have a 32% advantage* with coinbase over paypal when it comes to the price of payment processing.

If anything that shows coinbases pricing is very competitive... they just happen to process bitcoin.

*that does not include bitcoin network fees and exchange slippage though.....

No, they don't.  They brought in 32% more revenue PER TRANSACTION compared to Paypal.  Revenue is income before any expenses, fees, taxes, etc.

Which is essentially, in this case the same thing.

[SgtSpike]

They have a 32% advantage* with coinbase over paypal when it comes to the price of payment processing.

If anything that shows coinbases pricing is very competitive... they just happen to process bitcoin.

*that does not include bitcoin network fees and exchange slippage though.....

No, they don't.  They brought in 32% more revenue PER TRANSACTION compared to Paypal.  Revenue is income before any expenses, fees, taxes, etc.

Which is essentially, in this case the same thing.

Not at all.

You said "They have a 32% advantage* with coinbase over paypal when it comes to the price of payment processing."  This is not true.  The price (or better put, cost) of payment processing is not factored into revenue numbers, because revenue is income before any expenses, fees, taxes, etc.

Let me give you an example, since you're still not getting it.

1 year subscription is $29.99
1 month subscription is $3.99

Paypal stats (example):
- 1851 transactions
- 695 year-long subscriptions
- 1,156 month-long subscriptions

Bitcoin stats (example):
- 71 transactions
- 35 year-long subscriptions
- 36 month-long subscriptions

Paypal usage = 96.31% (1851 / 1922)
Bitcoin usage = 3.69% (71 / 1922)
Paypal total revenue = $25,455.49 (695 * 29.99 + 1,156 * 3.99)
Bitcoin total revenue = $1,193.29 (35 * 29.99 + 36 * 3.99)
Paypal revenue % = 95.52% (25,455.49 / 26,648.78)
Bitcoin revenue % = 4.48% (1,193.29 / 26,648.78)

So, Bitcoin revenue compared to Bitcoin usage is up by 21%!  Does that mean that Bitcoin is 21% more efficient than Paypal at processing payments?  Of course not!  It simply means that Bitcoin users bought higher priced items than Paypal users did.  If you notice, almost 50% of Bitcoin users bought a year long subscription, vs only 37% of Paypal users doing the same.

This has absolutely nothing to do with fees, efficiency of payment processing, or anything else of that nature.  Revenue does not take into account expenses of any kind.  Ever.  Period.

[ElectricMucus]

This is just in: Taxes and other expenses rise proportionally!

You are nitpicking something I wasn't even concerned about, well done. Oh here you have it: You're right. 

[Malawi]

This has absolutely nothing to do with fees, efficiency of payment processing, or anything else of that nature.  Revenue does not take into account expenses of any kind.  Ever.  Period.

Not even customer-side fees? Does you have 10010 dollar in revenue when a customer has to pay 10 dollars to transfer 10000 dollars? 

[SgtSpike]

This is just in: Taxes and other expenses rise proportionally!

You are nitpicking something I wasn't even concerned about, well done. Oh here you have it: You're right. 

What?  I'm not nitpicking - I'm saying you're dead wrong.  Which, you are.  The information provided does not give any sort of conclusion with regards to the cost of payment processing.  There is literally ZERO information about payment processing fees.  And yet you're trying to say that people buying longer subscriptions with Bitcoin than with Paypal is "essentially, in this case the same thing" as Coinbase having a 32% better price when it comes to payment processing.  These things have no relationship to each other, whatsoever.  It is not essentially the same thing.  It is not close to the same thing.  At all.  So please, retract your statements and stop spreading misinformation.

This has absolutely nothing to do with fees, efficiency of payment processing, or anything else of that nature.  Revenue does not take into account expenses of any kind.  Ever.  Period.

Not even customer-side fees? Does you have 10010 dollar in revenue when a customer has to pay 10 dollars to transfer 10000 dollars? 

Customer-side fees are irrelevant to the merchant recording the revenue.  In your example, the merchant would record $10,000 of revenue.