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Author Topic: Bitcoins are not ecommerce friendly. So far no alternatives are either.  (Read 1367 times)
Minsc
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September 06, 2011, 07:54:38 PM
 #1

Buying normally is like this.
* Buyer goes to website,clicks products to buy and then when they pay, they enter their credit card.
* Then in 30 seconds maximum, they get a confirmation their payment went through.
* They also have dispute rights with their credit card if the buyer scams them.

Buying with bitcoins is like this.
* With bitcoins, well let's skip gettng the coins.  And we'll skip price fluctuations and pretend the price is stable.
* Okay so buyer has coins in Mt. Gox.
* Buyer downloads the software and then they start downloading transactions.  This is about a gig to download now, but may be 100 gigs in the future.  At a cable modem, I can download a 1 gig movie or tv show in about 5 minutes if everyone is seeding, but with bitcoin transactions, I get new information at about 10k per second so it takes a month to get most.  And then when I get closer to getting them all, it goes really slow because the other clients just wont share their shares.  I had the same issue in spring 2010 when the transaction table was almost nothing, just because clients just won't share the transactions.
* So buyer gives up after a day waiting.  They then figure it's faster to transfer right from Mt. Gox, which is bad because bitcoins are about not being dependent on some website.
* Bitcoin shopping cart has their order ready and saved and they must transfer their coins.
* The buyer then copy and pastes a bitcoin address and hopes they didn't enter it wrong and lose their money.
* Buyer transfers their coins and waits several hours for them to arrive, then even longer for the seller to verify and tell them the products haven't run out of stock during the wait.
* Buyer has no escrow and bitcoin escrow are even more cumbersome.


You see the problem?  Bitcoin shopping needs to be ecommerce-friendly.

* The transaction table should be transmitted much better.  It should condense or purge old transactions more than a year.  It then needs to send the data compressed.  Next, clients should be forced to upload it faster to the other clients.
* The system needs some good shopping cart and escrow system that cannot be stopped by the government shutting down escrow websites.  If we depend on escrow websites, then the government can just shut them all down.
* Transactions need to be processed within under a minute.
* Store transactions need a link like this...  btc://[ip address]:[bitcoin address]:[bitcoin amount]:[identifier]  ... and then the buyer hits "query" and it connects to the store's IP address, then it sends data via encryption back and forth and the store will confirm like "Thank you for shopping at S-Mart.  Jane Smith, your order of 1 purse, and a pair of socks is ready."  Then the buyer must hit "send coins" to confirm and send the order and this query system lets people know they didn't send coins to the wrong place.



Lastly, you people may call this stuff whiny or what not, but this is what most people will deal with when shopping with bitcoins.

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September 06, 2011, 07:57:16 PM
 #2

Buying normally is like this.
* Buyer goes to website,clicks products to buy and then when they pay, they enter their credit card.
* Then in 30 seconds maximum, they get a confirmation their payment went through.
* They also have dispute rights with their credit card if the buyer scams them.

Buying with bitcoins is like this.
* With bitcoins, well let's skip gettng the coins.  And we'll skip price fluctuations and pretend the price is stable.
* Okay so buyer has coins in Mt. Gox.
* Buyer downloads the software and then they start downloading transactions.  This is about a gig to download now, but may be 100 gigs in the future.  At a cable modem, I can download a 1 gig movie or tv show in about 5 minutes if everyone is seeding, but with bitcoin transactions, I get new information at about 10k per second so it takes a month to get most.  And then when I get closer to getting them all, it goes really slow because the other clients just wont share their shares.  I had the same issue in spring 2010 when the transaction table was almost nothing, just because clients just won't share the transactions.
* So buyer gives up after a day waiting.  They then figure it's faster to transfer right from Mt. Gox, which is bad because bitcoins are about not being dependent on some website.
* Bitcoin shopping cart has their order ready and saved and they must transfer their coins.
* The buyer then copy and pastes a bitcoin address and hopes they didn't enter it wrong and lose their money.
* Buyer transfers their coins and waits several hours for them to arrive, then even longer for the seller to verify and tell them the products haven't run out of stock during the wait.
* Buyer has no escrow and bitcoin escrow are even more cumbersome.


You see the problem?  Bitcoin shopping needs to be ecommerce-friendly.

* The transaction table should be transmitted much better.  It should condense or purge old transactions more than a year.  It then needs to send the data compressed.  Next, clients should be forced to upload it faster to the other clients.
* The system needs some good shopping cart and escrow system that cannot be stopped by the government shutting down escrow websites.  If we depend on escrow websites, then the government can just shut them all down.
* Transactions need to be processed within under a minute.
* Store transactions need a link like this...  btc://[ip address]:[bitcoin address]:[bitcoin amount]:[identifier]  ... and then the buyer hits "query" and it connects to the store's IP address, then it sends data via encryption back and forth and the store will confirm like "Thank you for shopping at S-Mart.  Jane Smith, your order of 1 purse, and a pair of socks is ready."  Then the buyer must hit "send coins" to confirm and send the order and this query system lets people know they didn't send coins to the wrong place.



Lastly, you people may call this stuff whiny or what not, but this is what most people will deal with when shopping with bitcoins.


I'm pretty sure green addresses fix a lot of these issues.  I sure would like to see an update in Bitcoin which handeled this better.

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September 06, 2011, 08:06:37 PM
 #3

Lastly, you people may call this stuff whiny or what not, but this is what most people will deal with when shopping with bitcoins.

Everything you say is more or less valid. It's certainly not whiny, it's real world and the stuff we should care about.

However Credit Cards are not really ecommerce friendly either. Payments can be revoked later leaving the merchant out of pocket. This happens all the time.

Bank transfers are not ecommerce friendly either. The merchant might just keep the money and send nothing. Same with cash, checks, or money orders.


Escrow seems the best system to fix these issues, however that relies on the party handling the escrow to be trustworthy, helpful, and impartial during disputes. It should be possible to deposit some BitCoins with an escrow service in advance of making the trade so that transaction delays don't occur.
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September 06, 2011, 08:17:29 PM
 #4

Lastly, you people may call this stuff whiny or what not, but this is what most people will deal with when shopping with bitcoins.

Everything you say is more or less valid. It's certainly not whiny, it's real world and the stuff we should care about.

However Credit Cards are not really ecommerce friendly either. Payments can be revoked later leaving the merchant out of pocket. This happens all the time.

Bank transfers are not ecommerce friendly either. The merchant might just keep the money and send nothing. Same with cash, checks, or money orders.


Escrow seems the best system to fix these issues, however that relies on the party handling the escrow to be trustworthy, helpful, and impartial during disputes. It should be possible to deposit some BitCoins with an escrow service in advance of making the trade so that transaction delays don't occur.



Credit cards are friendly for the buyers if they know their chargeback rights.  But a lot of them don't and get scammed and those that know will abuse them and claim the card was stolen after a "friendly fraud" shopping spree with everything delivered to their home and the bank.

I had a merchant account and I've proven stuff delivered to the buyer's home in their name, sometimes even with their signature and the banks just decide in favor of the "friendly fraud" buyer.  And then when I have basically no evidence at all, and merely by writing an angry letter about how all people who file chargebacks are scammers, the bank filed in my favor.  Then I kept writing angry letters each time and winning.  But I got out of that business to do something else.

Umm anyway, credit cards are easy for buyers and well it doesn't matter for sellers because they'll sell stuff if there's buyers.  Look at eBay.

Echecks are kinda funny because they only let people dispute for unauthorized so scammers can file disputes but not people who were ripped off.

As for escrow, we only need something that simply makes sure the seller shipped something to the buyer.  If you do a "not as described", nobody can prove anything unless you video tape the packing and dropping off at the post office, or else if the weight on the package is way too light.  And this tracking requirement can be done really easily and cheaply.   You just need to pay miners some transaction fee to check, basically make them enter the zip code if it's delivered or "0" if not delivered and all 10 people must have it match the zip code for it to be good.  The only problem is when the post office screws up and enters a zip code 2 digits off.


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September 06, 2011, 11:02:53 PM
 #5

I have the same ideas, and came up with a solution in fastcoin.
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September 06, 2011, 11:10:03 PM
 #6

a) Where can I download this "credit card"? How much GB?
b) Convince the developers that the bitcoin client handles the "bitcoin:" urls. They always use lame excuses.
c) Use bitcoin-qt, much better ui
d) The shop could give the OK on 0 confirmation, and deliver on 6 confirmation.
Minsc
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September 06, 2011, 11:18:10 PM
 #7

d) The shop could give the OK on 0 confirmation, and deliver on 6 confirmation.

I like it.  It's like credit card authorization holds and batching.  Businesses place a hold on a credit card and batch out at the end of the day.  This would be good for online ordering.

But you know what, it would be a good idea too if we can get smart cards that can hold bitcoin values so you swipe it over a vending machine, your smart card shows a value, then you enter a pin on the card and poof it sends money.

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Minsc
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September 07, 2011, 02:59:10 AM
 #8

Please fix this in the next ecurrency.
http://online.wsj.com/video/bitcoin-to-burn-a-hole-in-your-pocket/1FADAD1B-15D6-4250-AD7B-E62556C5D1A3.html

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September 07, 2011, 04:13:08 AM
 #9

I've purchased with Bitcoin online and it's a freakin' breeze.

Instawallet + green address = transactions in less than 30 seconds. Honestly, I've found btc easier on occasion, as I don't have to go hunt around my house for my credit card.  Now, the OP is correct that a newb might get bogged down in Bitcoin and it would seem like a huge hassle. Newbs should not be using the client though... they should use instawallet or mtgox or flexcoin, etc.
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September 07, 2011, 05:52:24 AM
 #10

So you have to use a wallet website for bitcoins?  That's a problem.  Websites typically only accept so many wallet websites and normally a few big ones control the market and then the government controls them.  Bitcoins must be free of the government and so the wallet website stuff needs to be coded in to the next alternative.

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September 07, 2011, 07:57:43 PM
 #11

Also from design and spec sheets, I believe I read that the blockchain can be compressed once it gets out of hand, making the old data crushed into a hash, so it could hover between 1-2gb forever, not getting out of hand like you say. With internet speeds going up and storage is cheap (a few cents per gig at current prices, you can get a few gig usb for $5) that sounds like a managable amount.
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September 07, 2011, 08:17:50 PM
 #12

How about the open transactions program.

https://github.com/FellowTraveler/Open-Transactions/wiki

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September 07, 2011, 11:44:34 PM
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#1: The blockchain can be compressed easily, it just hasn't been implemented yet, so that's a moot point.

#2: Including the download of the blockchain as part of the transaction is a straw man, as it only has to be done once. Additionally, as was mentioned before - plenty of wallet sites to go around.

#3: Transactions don't take hours to confirm unless you don't attach a fee to a very small transaction. Furthermore, If your webstore isn't setup to automate confirming the transaction, YOU'RE the one who isn't ecommerce friendly.

-Garrett
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September 08, 2011, 11:37:56 AM
 #14

List of your ideas on how to (or what features are needed) fix this problem are more than welcome here: https://bitcointalk.org/index.php?topic=42027.msg513933#msg513933

Thank you

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BTW, Things in BTC bubble universes are getting ugly....
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September 09, 2011, 05:58:18 PM
 #15

I do believe that there is no functional necessity to get your coins from mtgox to your soft to pay for a thing.

At least  I routinely donate coins to people who help me out with GeistGeld directly from my gox acct.

Geist Geld, the experimental cryptocurrency, is ready for yet another SolidCoin collapse Wink

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