How to Turn Bitcoin Into the Top Payment Network and the Currency of the Future

[Phinnaeus Gage]

Wait, I just realized the best way to handle money....minted paper and coins! We should make some kind of... I don't even have the energy to finish this joke.

PG to the rescue (take a nap, Matt):

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[casascius]

I tend to agree with the OP's line of thinking.  I believe this guy knows what he is talking about.  I don't think those who disagree with him are "wrong", but he clearly gets a concept that many of us do not seem to grasp.

Yes, many people (myself included) will prefer smartphones as a way to transfer bitcoins.  But it will be a huge leap of progress when trading Bitcoins through tangible objects becomes more commonplace.

I don't envision plastic cards - I envision disposable self-printed paper wallet bills with QR codes - where the standard methodology is you allow the QR code to be scanned by a merchant, and it swipes the money off the private key, leaving behind change (on the honor system - consistent with OP's vision).  The control against theft is you just don't put that much money on a single code - or secondarily, the change can be sent to another address not controlled by the merchant (e.g. another paper wallet in the holder's physical wallet). Most merchants are going to be honest, that's just the way things are.

I don't envision vending machines with any sort of touchscreens or any crap needed to accept bitcoins other than a QR code scanner.  With a QR scanner, you show your code, buy what you want, it takes bitcoins off your address and sends back the change to the same address it took them from.  That's the level of convenience the OP insists (and which I agree) Bitcoin needs to be taken seriously as an everyday currency.

[Matthew N. Wright]

I tend to agree with the OP's line of thinking.

You tend to agree with Atlas? Probably want to keep that one to yourself.

[Jon]

I tend to agree with the OP's line of thinking.

You tend to agree with Atlas? Probably want to keep that one to yourself.

Come on, Matthew, you know I am not a bad guy. This isn't grade school.

[goodlord666]

I think the biggest barrier to all of this is that Bitcoin is a push only system. There's no way for Bitcoin to get pulled from an account, like fiat can get pulled from banks or credit cards.

Allow me to protest! In principle, fiat banknotes and coins are push-only, too. Unless we're talking about having your dollars pulled from your back pocket.

Turning Bitcon into a pull-system would be as simple as updating the client to allow incoming pull requests and upon verification using key-pairs or something have the BTC auto-sent.

If your coins were stored in a bitcoin bank, what's to keep you from using a credit card in a store which allows the merchant to make a quick check on liquidity on your account and then send a pull request to your bank? The bank then sends the coins to the vendor.

And Boss gets to spend his bitcoins using a credit card, hooray!


edit: typo

[DeathAndTaxes]

I think the biggest barrier to all of this is that Bitcoin is a push only system. There's no way for Bitcoin to get pulled from an account, like fiat can get pulled from banks or credit cards.

Allow me to protest! In principle, fiat banknotes and coins are push-only, too. Unless we're talking about having your dollars pulled from your back pocket.

Turning Bitcon into a push-system would be as simple as updating the client to allow incoming pull requests and upon verification using key-pairs or something have the BTC auto-sent.

Or better build pull systems on TOP of Bitcoin.

Cash = push only
Credit cards, Debit Cards, ACH, etc = pull payment systems built on top of cash.

Bitcoin = push only
something, something else, also something else = pull payment systems built on top of Bitcoin

[rjk]

I think the biggest barrier to all of this is that Bitcoin is a push only system. There's no way for Bitcoin to get pulled from an account, like fiat can get pulled from banks or credit cards.

Allow me to protest! In principle, fiat banknotes and coins are push-only, too. Unless we're talking about having your dollars pulled from your back pocket.

Turning Bitcon into a push-system would be as simple as updating the client to allow incoming pull requests and upon verification using key-pairs or something have the BTC auto-sent.

If your coins were stored in a bitcoin bank, what's to keep you from using a credit card in a store which allows the merchant to make a quick check on liquidity on your account and then send a pull request to your bank? The bank then sends the coins to the vendor.

And Boss gets to spend his bitcoins using a credit card, hooray!

This is something that I have been turning over in my head for many months, in relation to such things as paying for a monthly service (VPS for example). My idea was to use a protocol such as iCalendar or some such, and integrate it into a client to automatically pay out of a wallet the necessary amount each month (after approval by the wallet owner). That way, the price could be specified in USD by the merchant, and the client would automatically fetch the current BTC <> USD value each month and tell the wallet owner how much to pay out to the service.

[Matthew N. Wright]

I tend to agree with the OP's line of thinking.

You tend to agree with Atlas? Probably want to keep that one to yourself.

Come on, Matthew, you know I am not a bad guy. This isn't grade school.

Au contraré, only in grade school would you define people as 'good' or 'bad' and not weigh individual risks and annoyances by people based on their views, attitudes, etc.

I've already seen you admit to not being 100% accurate twice in the past few days. It's a breathtaking change of pace for sure, but you still live in a glass house and have got quite a ways to go.

[goodlord666]

I don't envision plastic cards - I envision disposable self-printed paper wallet bills with QR codes

Let me bring this to another level:
Women LOVE credit cards. Women DONT LOVE disposable self-printed paper wallet bills with QR codes.

[goodlord666]

I think the biggest barrier to all of this is that Bitcoin is a push only system. There's no way for Bitcoin to get pulled from an account, like fiat can get pulled from banks or credit cards.

Allow me to protest! In principle, fiat banknotes and coins are push-only, too. Unless we're talking about having your dollars pulled from your back pocket.

Turning Bitcon into a push-system would be as simple as updating the client to allow incoming pull requests and upon verification using key-pairs or something have the BTC auto-sent.

If your coins were stored in a bitcoin bank, what's to keep you from using a credit card in a store which allows the merchant to make a quick check on liquidity on your account and then send a pull request to your bank? The bank then sends the coins to the vendor.

And Boss gets to spend his bitcoins using a credit card, hooray!

This is something that I have been turning over in my head for many months, in relation to such things as paying for a monthly service (VPS for example). My idea was to use a protocol such as iCalendar or some such, and integrate it into a client to automatically pay out of a wallet the necessary amount each month (after approval by the wallet owner). That way, the price could be specified in USD by the merchant, and the client would automatically fetch the current BTC <> USD value each month and tell the wallet owner how much to pay out to the service.

Wow, parallel thinking.. me like!
Only, why bother with USD conversion? If we can make the system work just for Bitcoins, fair enough!

What you describe is what I envision for home use, for the majority of people bitcoin banks in cooperation with credit card companies are probably the solution.

Somebody has just gotta do it.

[Red Emerald]

I just can't picture carrying a stack of what are essentially gift cards with varying amounts in my wallet.  I hate going into Jamba Juice and handing them a card with 5 cents on it and then digging around to find another card with 12 cents on it.

A cheap camera phone could sign a transaction and then give it to the merchant to relay.  No need for the customer to have internet access or an expensive smart phone.  We have a system that doesn't require trusting merchants.  Lets keep it that way.

I also think having one device (yes, even one with batteries) is better than a bunch of plastic or paper.  I see physical coins as a system for trading when there isn't electricity/internet around and as something to help people who are used to paper cash and coins transition away towards a digital currency.

[rjk]

I think the biggest barrier to all of this is that Bitcoin is a push only system. There's no way for Bitcoin to get pulled from an account, like fiat can get pulled from banks or credit cards.

Allow me to protest! In principle, fiat banknotes and coins are push-only, too. Unless we're talking about having your dollars pulled from your back pocket.

Turning Bitcon into a push-system would be as simple as updating the client to allow incoming pull requests and upon verification using key-pairs or something have the BTC auto-sent.

If your coins were stored in a bitcoin bank, what's to keep you from using a credit card in a store which allows the merchant to make a quick check on liquidity on your account and then send a pull request to your bank? The bank then sends the coins to the vendor.

And Boss gets to spend his bitcoins using a credit card, hooray!

This is something that I have been turning over in my head for many months, in relation to such things as paying for a monthly service (VPS for example). My idea was to use a protocol such as iCalendar or some such, and integrate it into a client to automatically pay out of a wallet the necessary amount each month (after approval by the wallet owner). That way, the price could be specified in USD by the merchant, and the client would automatically fetch the current BTC <> USD value each month and tell the wallet owner how much to pay out to the service.

Wow, parallel thinking.. me like!
Only, why bother with USD conversion? If we can make the system work just for Bitcoins, fair enough!

What you describe is what I envision for home use, for the majority of people bitcoin banks in cooperation with credit card companies are probably the solution.

Somebody has just gotta do it.

Until we have major buy-in and therefore stability, there is no way any sane merchant will try to price his service in only BTC. This enables merchants to get a predictable amount of USD for their services each month, with no work really needing to be done. The decentralized online automatic reoccurring bill-pay!

[Rassah]

So, um, what was the problem with the idea of having one simple keyfob-sized device with one button, whose only function is to sign transactions pushed to it when it's swiped, without giving out the private key?

[rjk]

So, um, what was the problem with the idea of having one simple keyfob-sized device with one button, whose only function is to sign transactions pushed to it when it's swiped, without giving out the private key?

An evil POS or hacked version could display the wrong amount, and charge you for way more? I dunno, I guess that is something that could happen already - but when dealing with something that is irreversible, I tend to be more cautious.

[Matthew N. Wright]

So, um, what was the problem with the idea of having one simple keyfob-sized device with one button, whose only function is to sign transactions pushed to it when it's swiped, without giving out the private key?

It's been argued to death. The infrastructure behind it being accepted at all is not limited by the card itself-- that technology is already being used today by every credit card outside of the USA-- the requirements are from the POS developers and service providers. It's not a technology issue, it's a standards issue. Good luck with it as all I can say.

[siggy]

Let me bring this to another level:
Women LOVE credit cards. Women DONT LOVE disposable self-printed paper wallet bills with QR codes.

THIS is the most important post I've read in this whole thread.  (I know my wife well.)  If you want mainstream adoption, anything beyond SWIPE & enter PIN is going to be a non-starter.

Sooo..  figure out a way to make 2 factor authentication work with.. 1) SWIPE physical card... 2) enter 4 digit PIN.   

If we are talking smartcards here, I can _maybe_ see 1) SWIPE  2) card displays amount and custom generated PIN valid only for that amount  3) enter 4 digit PIN

Sigg

[Matthew N. Wright]

Let me bring this to another level:
Women LOVE credit cards. Women DONT LOVE disposable self-printed paper wallet bills with QR codes.

THIS is the most important post I've read in this whole thread.  (I know my wife well.)  If you want mainstream adoption, anything beyond SWIPE & enter PIN is going to be a non-starter.

Sooo..  figure out a way to make 2 factor authentication work with.. 1) SWIPE physical card... 2) enter 4 digit PIN.   

If we are talking smartcards here, I can _maybe_ see 1) SWIPE  2) card displays amount and custom generated PIN valid only for that amount  3) enter 4 digit PIN

Sigg

Well, I totally agree that that is in fact the norm, but it may or may not be in our interest to actually try to ween consumers away from their current habits.

[siggy]

[Well, I totally agree that that is in fact the norm, but it may or may not be in our interest to actually try to ween consumers away from their current habits.

OK..  after re-reading my post, I think I put the stress in the wrong place.  What I should have said was "Anything more complicated than SWIPE & PIN is a non starter" ..  I think any 1 or 2-step process would probably work, so long as it is simple.  The KISS concept is in play here.   

OK.. so if we go the smartphone route.. could you integrate a bluetooth connection between the wallet and the POS terminal to send the payment request?

Scenario:   Clerk rings up new pair of B100 shoes..  POS does a quick scan and see's that wife's bluetooth wallet is closest to the register.  POS sends the B100 payment request to wife's phone.  Phone goes "BING" and wife sees the wallet with a message:  "Would you like to pay B100 to Expensive Shoe Store?"   Wife taps the "YES" button on her screen.  Her wallet takes care of sending the payment.

In the above scenario, wife's entire interaction is to tap the "YES" button... keeping things simple for her.. she'd go for that.

Alternatively, could a RFID/Bluetooth enabled smartcard be created with a simple display that does the same thing?  basically piggyback off the POS internet connection to send out the transaction to the nearest node?

Sigg

   

[Matthew N. Wright]

OK..  after re-reading my post, I think I put the stress in the wrong place.  What I should have said was "Anything more complicated than SWIPE & PIN is a non starter" .. 

Couldn't agree more. Bitcoin is about as interesting to the average consumer as the type of engine in a car to the average driver.

[goodlord666]

it may or may not be in our interest to actually try to ween consumers away from their current habits.

no, you can do that later, after it's become the 'top payment network and currency of the future'.

Agreed. Luring people into Bitcoin by way of adapting to the norm first could pave the way for widespread acceptance. And then someone may come up with a killer application for handling that'll totally change habits. I think Bitcoin's strength lies in its flexibility to be handled in all sorts of different ways.