Bitcoin growth - The Long View

[CurbsideProphet]

One of the barometers that I'm using is to try and sell goods here on the forum.  Afterall, everyone here understands Bitcoin so if I can't sell here, then the rest of the world surely isn't ready yet.

IMHO the forum is an awful place for buying and selling goods - I spend Bitcoins nearly every day but I have not looked here in the respective forum-sections for a long time. It is just not the right interface for finding stuff. Also the audience at amazon.com is orders of magnitudes larger than in our forums here - add one additional order of magnitude for everybody who, like me, simply doesn't bother to wade through tons of forum posts in order to find something they want to buy. So you would really have to offer a _lot_ here to be able to compare it to Amazon. Anyway - you could probably deduce something useful from the total number of successful trades here on the forum. Anybody has statistics about that?

The Bitcoin economy is still young - good trading sites are rare and we don't have anything close to Amazon.com in terms of usability. Give it some time - it will develop. People are spending their coins, even though many just don't really know how to deal with this new things just yet. Eventually it will be just money to them and they will spend it accordingly.

Don't worry - everything's gonna be alright

Oh and I agree: this thread has probably turned into a worthy candidate for the Speculation section. Apologies to the OP for this obviously unintended development.

I think you may have misunderstood me, I wasn't trying to make comparisons to Amazon.  The only reason I brought up Amazon is to state that I know the product I'm selling has value.  Maybe I should have omitted Amazon and just stated that I have a contract in place with a vendor that will pay me X amount, guaranteed, for my product.  It was simply used to show that I'm not selling junk.

You may be right in that these forums may not be the best avenue for sale but I don't have enough for sale to start my own website nor do I see any well established Bitcoin auction sites I'm fond of at the moment.  As I said, this is just one of my personal barometers and I won't draw conclusions too hastily.  

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[error]

Oh sure, now I get three reports on this thread. Ha.

[error]

One of the barometers that I'm using is to try and sell goods here on the forum.  Afterall, everyone here understands Bitcoin so if I can't sell here, then the rest of the world surely isn't ready yet.  So far my result has been less than impressive.  No minimum bid, 80+ views, no offers.  I know my goods have value because I have a locked in price from Amazon as to what they would be willing to give me for my item.

I've seen estimates of Amazon conversion rates of 20-25% for their own products. So even if you had the same level of credibility and trust as Amazon, and your views were from visitors you are targeting that are interested in buying the products you sell, you couldn't expect more than 20 sales. But you don't have the credibility and trust that Amazon has. If you had a professional website with good product presentations, visible mailing address, telephone number, and e-mail address and other credible websites around the Internet speaks positive of you, you could probably expect 2-5% conversion rate, and up to 4 sales. If you don't even have that, then I'm not surprised that you don't have any sales after just 80 views. It doesn't mean that Bitcoin is at fault. Try split testing BTC/USD and compare the difference in conversion rate. I doubt you will see much difference.

True.

I'm quite happy to spend Bitcoins on the forum or with various merchants; however I'm only buying things I want and need! If you offer something I have no interest in buying, then I'm not going to buy it, regardless of the payment method. I suspect most people act similarly.

[Synaptic]

One of the barometers that I'm using is to try and sell goods here on the forum.  Afterall, everyone here understands Bitcoin so if I can't sell here, then the rest of the world surely isn't ready yet.  So far my result has been less than impressive.  No minimum bid, 80+ views, no offers.  I know my goods have value because I have a locked in price from Amazon as to what they would be willing to give me for my item.

I've seen estimates of Amazon conversion rates of 20-25% for their own products. So even if you had the same level of credibility and trust as Amazon, and your views were from visitors you are targeting that are interested in buying the products you sell, you couldn't expect more than 20 sales. But you don't have the credibility and trust that Amazon has. If you had a professional website with good product presentations, visible mailing address, telephone number, and e-mail address and other credible websites around the Internet speaks positive of you, you could probably expect 2-5% conversion rate, and up to 4 sales. If you don't even have that, then I'm not surprised that you don't have any sales after just 80 views. It doesn't mean that Bitcoin is at fault. Try split testing BTC/USD and compare the difference in conversion rate. I doubt you will see much difference.

True.

I'm quite happy to spend Bitcoins on the forum or with various merchants; however I'm only buying things I want and need! If you offer something I have no interest in buying, then I'm not going to buy it, regardless of the payment method. I suspect most people act similarly.

Exactly.  If people are offered something they have no interest in buying, then they aren't going to buy it, regardless if it's the greatest payment method known to humankind.

Enter Bitcoins.

[CurbsideProphet]

One of the barometers that I'm using is to try and sell goods here on the forum.  Afterall, everyone here understands Bitcoin so if I can't sell here, then the rest of the world surely isn't ready yet.  So far my result has been less than impressive.  No minimum bid, 80+ views, no offers.  I know my goods have value because I have a locked in price from Amazon as to what they would be willing to give me for my item.

I've seen estimates of Amazon conversion rates of 20-25% for their own products. So even if you had the same level of credibility and trust as Amazon, and your views were from visitors you are targeting that are interested in buying the products you sell, you couldn't expect more than 20 sales. But you don't have the credibility and trust that Amazon has. If you had a professional website with good product presentations, visible mailing address, telephone number, and e-mail address and other credible websites around the Internet speaks positive of you, you could probably expect 2-5% conversion rate, and up to 4 sales. If you don't even have that, then I'm not surprised that you don't have any sales after just 80 views. It doesn't mean that Bitcoin is at fault. Try split testing BTC/USD and compare the difference in conversion rate. I doubt you will see much difference.

You make some good points but how do you build credibility based on a currency that uses anonymity as one of its advantages?  I could construct a website but I'm not in the market to be a larger seller.  

I guess what I'm asking is, if the most bullish of Bitcoin users (presumably those here on the forum) are unwilling to use Bitcoin due to its anonymity, how can we expect the mainstream public to embrace it?  Other than face to face transactions, I see this as a potential problem.

I do recognize that it is a very small community and it could very well be that no one is particularly interested in what I'm trying to sell.  Although if that's the case why would you click the link when the product for sale is very clearly stated in the title?  Curiosity I suppose but surely a fraction of those 80 views must have been some interest?  

[wareen]

I could construct a website but I'm not in the market to be a larger seller. 

Check out bitcoinworldmarket.com - they act as a proxy and therefore eliminate the problem of initial trust. They take care of the customer contact, offer a nice shopping interface and handle returns. They have direct deals with multiple merchants, so if you have a good product you can contact them and they might include it in their shop.

I guess what I'm asking is, if the most bullish of Bitcoin users (presumably those here on the forum) are unwilling to use Bitcoin due to its anonymity, how can we expect the mainstream public to embrace it?

If I didn't know anything about you, I would probably not buy anything from you - regardless of the payment method. There's escrow for such cases but since Gavin gave up on clearcoin I think the alternatives still have to build up some credibility by themselves.
The anonymity of the payment method is not the problem here - the anonymity of the merchant is. Bitcoin relieves us from having to trust in any payment processor but it just shifts the trust concern towards the merchants (due to the non-reversibility of transactions).

Luckily the merchant does not have to be anonymous with Bitcoin. If he choses to be, there are rating systems like the OTC-web of trust to address exactly this problem. I don't see the masses buying from anonymous merchants anytime soon though.

[TraderTimm]

Oh sure, now I get three reports on this thread. Ha.

Ha, a lot has transpired since I last looked at the board. The difference is, I'm not going to have a hissy fit like Synaptic Think we still had a some good posts compared to the disaster his thread spawned. Keep it up, guys!

[Synaptic]

Oh sure, now I get three reports on this thread. Ha.

Ha, a lot has transpired since I last looked at the board. The difference is, I'm not going to have a hissy fit like Synaptic Think we still had a some good posts compared to the disaster his thread spawned. Keep it up, guys!

HISS HISS.

[TraderTimm]

How the fuck was this thread left on the main page but my MIRROR thread with the reverse opinion is shoved into the speculation sub-forum?

Just for the uninformed, a hissy fit looks like the above

[patvarilly]

One of the barometers that I'm using is to try and sell goods here on the forum.  Afterall, everyone here understands Bitcoin so if I can't sell here, then the rest of the world surely isn't ready yet.  So far my result has been less than impressive.  No minimum bid, 80+ views, no offers.  I know my goods have value because I have a locked in price from Amazon as to what they would be willing to give me for my item.

Obviously one item isn't enough to make any sort of conclusion, but I think as I put more items up for bid, it will give me a better sense of if this Bitcoin truly is just for speculators or a viable medium of exchange.

The stories of so and so bought a car or house with Bitcoin is irrelevant to me.  A guy bartered a red paper clip into a house.  Doesn't mean I should go out and buy red paper clips.  Anyway, that's one of the current metrics I'm using for my personal bullish/bearish long-term outlook on BTC.

Come back to make comments on this analysis of yours in a year. Then you can say you've really tried and took the time to see what this market will become.

Fortunately, we have a control experiment for this, when Suggester made many of the same arguments being made today on Feb 18, 2010: http://forum.bitcoin.org/index.php?topic=57.msg390#msg390.  I think his logic was reasonably sound, if not perfect, and many of the things he said have since come through (e.g., speculation and bubble/bust being the main thing driving interest and transactions for Bitcoin).

On a similar note to what CurbsideProphet is doing, I kindly asked the guy that actually runs bitcoinworldmarket.com if he could do a service to the community and tell us on a daily basis what his actual sales volume is (http://forum.bitcoin.org/index.php?topic=28276.msg357205#msg357205).  His original post expressed his concern about loans not being viable for Bitcoin (or any long-term deflationary scenario) and how this would choke business growth (for the record, my posts make it clear which side of that debate I take).  He hasn't taken me up on this, but I wish some other serious merchants would (e.g. spendbitcoins.com).  We can argue all day long about "YES YES YES Bitcoin will take over the world" or "NO NO NO it will crash and burn", but there's nothing like actual data to settle these questions.

[TraderTimm]

Fortunately, we have a control experiment for this, when Suggester made many of the same arguments being made today on Feb 18, 2010: http://forum.bitcoin.org/index.php?topic=57.msg390#msg390.  I think his logic was reasonably sound, if not perfect, and many of the things he said have since come through (e.g., speculation and bubble/bust being the main thing driving interest and transactions for Bitcoin).

On a similar note to what CurbsideProphet is doing, I kindly asked the guy that actually runs bitcoinworldmarket.com if he could do a service to the community and tell us on a daily basis what his actual sales volume is (http://forum.bitcoin.org/index.php?topic=28276.msg357205#msg357205).  His original post expressed his concern about loans not being viable for Bitcoin (or any long-term deflationary scenario) and how this would choke business growth (for the record, my posts make it clear which side of that debate I take).  He hasn't taken me up on this, but I wish some other serious merchants would (e.g. spendbitcoins.com).  We can argue all day long about "YES YES YES Bitcoin will take over the world" or "NO NO NO it will crash and burn", but there's nothing like actual data to settle these questions.

The 'bubble' aspect will be proven or disproven by the end of August, ( ref: http://forum.bitcoin.org/index.php?topic=26117.0 ). As far as the success of a statistically insignificant sample of one, I think all we're learning here is variance. The main point being is bitcoin has quite a bit to go before there are large network-effect increases.

I think this is the basis for many who defend bitcoin, myself included, because we know the potential exists - using an argument that it has already failed due to its relative immaturity is ludicrous. It would be like criticizing an infant for not knowing how to drive a car.

We'll get there, but expectations must be governed by the time needed to do so.

[netrin]

Exactly.  If people are offered something they have no interest in buying, then they aren't going to buy it, regardless if it's the greatest payment method known to humankind.

Enter Bitcoins.

Excellent observation, Synoptic. Now for extra credit...

! interested(x) --> ! Buying(x)
Buying(x) --> Interested(x)
x = bitcoin
! Buying( bitcoin ) --> ?

[piramida]

Excellent observation, Synoptic. Now for extra credit...

! interested(x) --> ! Buying(x)
Buying(x) --> Interested(x)
x = bitcoin
! Buying( bitcoin ) --> ?

! Buying( bitcoin ) --> Silly_shortsited(x)?

[TraderTimm]

Oldie but a goodie

[kjj]

Exactly.  If people are offered something they have no interest in buying, then they aren't going to buy it, regardless if it's the greatest payment method known to humankind.

Enter Bitcoins.

Excellent observation, Synoptic. Now for extra credit...

! interested(x) --> ! Buying(x)
Buying(x) --> Interested(x)
x = bitcoin
! Buying( bitcoin ) --> ?

Ooh!  I know this one!

! Buying( bitcoin ) --> ( Interested( bitcoin) | ! Interested( bitcoin ) )

And if I could only remember where I last saw my discrete math textbook, I could prove it!

[netrin]

! Buying( bitcoin ) --> ( Interested( bitcoin) | ! Interested( bitcoin ) )

BINGO! That people are not buying bitcoin tells us nothing about its perceived value (interest).