[2021-10-30] Blockchain technology can make micropayments finally functional

[waybesuricata]

As the use of digital wallets and cryptocurrencies becomes more abundant, new use cases for micropayments will be further explored and developed.
I recently came across Marc Andreessen’s article from 2014 on Bitcoin (BTC). In many ways, it is visionary (no surprise). I have been in the industry for four years now, with most of my focus being on the social impact of blockchain. It is astonishing to me that in 2014, before there was any institutional presence in Bitcoin — or, indeed, a popular understanding of this new technology — Andreessen was able to outline its potential economic and social impact for the future.

Nearly eight years after he inked his words, I would like to address one of the topics from his article: micropayments. I will explore how blockchain could help transform micropayments and thus enable not only the monetization of certain aspects of businesses that are in need of a solution but also could assist society’s most vulnerable.

Micropayments
Micropayments are not a new concept. Since the mid-1990s, micropayments have experienced various degrees of popularity. By definition, micropayments are transactions with a value smaller than a certain threshold. Importantly, below that threshold, the transaction fee incurred becomes a significant portion of the total transaction value and, consequently, not economical. Another important aspect is that due to the minuscule monetary amounts, micropayments refer only to digital transactions of non-tangible goods. Any additional cost of handling and shipping might mean a hundredfold increase of the original transaction value, making it utterly irrelevant.




Source and continuation of news:  https://cointelegraph.com/news/blockchain-technology-can-make-micropayments-finally-functional

[buwaytress]

I'm team blockchain, I guess, but even I wouldn't give it full credit for making micropayments "finally" functional. I saw myself micropayments work in the early 2010s all the way up to 2016 in many parts of E Africa -- without the problem you mention of transaction fees rendering the transaction uneconomical. Those mobile phone payments worked: feeless payments for fractions of a cent, without the need for internet or a smartphone, without the need for literacy beyond knowing numbers.

I could still go back today, 5 years later, to those places and be without access to Bitcoin, and wouldn't be surprised if it'd still be without internet or smartphone in 2030.

How does blockchain technology make micropayments functional in these kinds of places, where it's needed most?

[SFR10]

I read that article twice and still couldn't figure out how it becomes "finally functional" when everything that the writer described, was already there in the past few years ^{[and in some cases, a decade]}!

Due to blockchain’s asymmetric encryption, the payer exposes only their public address when paying, which provides practically no information for someone who is looking to hack their wallets.

Depending on the type of wallet that's being used and also the inputs of the transaction, they could be exposing a lot more information than one might imagine!

[bbc.reporter]

I'm team blockchain, I guess, but even I wouldn't give it full credit for making micropayments "finally" functional. I saw myself micropayments work in the early 2010s all the way up to 2016 in many parts of E Africa -- without the problem you mention of transaction fees rendering the transaction uneconomical. Those mobile phone payments worked: feeless payments for fractions of a cent, without the need for internet or a smartphone, without the need for literacy beyond knowing numbers.

I could still go back today, 5 years later, to those places and be without access to Bitcoin, and wouldn't be surprised if it'd still be without internet or smartphone in 2030.

How does blockchain technology make micropayments functional in these kinds of places, where it's needed most?

Agreed. Everything about this will have connection to bitcoin’s monetary policy. I reckon many maximalists will never admit this, however, it is very clear that the present design of bitcoin is not built for micropayments with the high fees because of limited supply, the halving every 4 years and the small blocks.