oda.krell
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September 03, 2014, 09:53:11 PM |
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this is the reason i don't believe in altcoins, bitcoin can just adapt and make altcoins obsolete.
No, and i´ve given some thought to this. The blockchain gives a provable accountability to people who choose so. Obviously that completely contradicts anonymity. However that may be very usefull. And yes, i´ve been trying to advocate that, but it really seems creating an alternate chain for "restricted" purchases is the better way to go. Do you think it actually matters how much a "coin" is worth if that "coin" is the aquivalent of "allow one purchase" of "restricted good" (be it a weapon, medicament, whatever). That coin can be signed by the transmitter. Geez, it doesnt even matter if its premined. If it just allows you to purchase things online you usually couldnt. Dont get me wront. Bitcoin would have been a really cool thing. Well, if it had come *before* Paypal etc.. We already have an online payment system. Costing a whole lot more (3% of the sale plus ~30 cent fixed vs. ~5 cent), and being a nightmare for merchants because of conflict resolution by default going in favor of the customer.
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vuduchyld
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September 04, 2014, 04:15:42 AM |
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this is the reason i don't believe in altcoins, bitcoin can just adapt and make altcoins obsolete.
No, and i´ve given some thought to this. The blockchain gives a provable accountability to people who choose so. Obviously that completely contradicts anonymity. However that may be very usefull. And yes, i´ve been trying to advocate that, but it really seems creating an alternate chain for "restricted" purchases is the better way to go. Do you think it actually matters how much a "coin" is worth if that "coin" is the aquivalent of "allow one purchase" of "restricted good" (be it a weapon, medicament, whatever). That coin can be signed by the transmitter. Geez, it doesnt even matter if its premined. If it just allows you to purchase things online you usually couldnt. Dont get me wront. Bitcoin would have been a really cool thing. Well, if it had come *before* Paypal etc.. We already have an online payment system. Costing a whole lot more (3% of the sale plus ~30 cent fixed vs. ~5 cent), and being a nightmare for merchants because of conflict resolution by default going in favor of the customer. Which is why I have been thinking a lot about the use case of buying gasoline with bitcoin. I don't mean using Qora or CoinFueled or some other card that a merchant processes at 3.75%, I mean actually buying gas using my bitcoin wallet and a QR code or some other native-to-the-gas-pump bitcoin technology. I've done quite a bit of consulting with c-stores and I can assure you that gas is a super low-margin item for them. There is motivation for them to save 3% (or sometimes more) off of processing costs. It is real money to these store owners. It's a real win-win. If I could buy gas with bitcoin, most of the time, I'd most likely just replenish my bitcoin stock with a purchase matching what I just spent. Merchants could, theoretically, offer some discount that would allow me to share in the savings they realize. Great for adoption, great for consumers, great for merchants, great for the community, even if the merchants are using bitpay and converting to fiat at purchase time. There are some technical details that make this tough. Confirmation times. Native infrastructure. When we can realistically solve these problems, bitcoin will have won. Right now, it works for NewEgg, Dell, or Expedia. I'm placing an order online and I don't expect the product to be delivered immediately. But when I can pay at the pump in bitcoin, what do you think that does for transaction numbers? Adoption? Price? Gas is a perfect use case. I want this to happen.
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SlipperySlope
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September 04, 2014, 04:27:51 AM |
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. . .
Which is why I have been thinking a lot about the use case of buying gasoline with bitcoin. I don't mean using Qora or CoinFueled or some other card that a merchant processes at 3.75%, I mean actually buying gas using my bitcoin wallet and a QR code or some other native-to-the-gas-pump bitcoin technology.
I've done quite a bit of consulting with c-stores and I can assure you that gas is a super low-margin item for them. There is motivation for them to save 3% (or sometimes more) off of processing costs. It is real money to these store owners.
It's a real win-win. If I could buy gas with bitcoin, most of the time, I'd most likely just replenish my bitcoin stock with a purchase matching what I just spent. Merchants could, theoretically, offer some discount that would allow me to share in the savings they realize. Great for adoption, great for consumers, great for merchants, great for the community, even if the merchants are using bitpay and converting to fiat at purchase time.
There are some technical details that make this tough. Confirmation times. Native infrastructure. When we can realistically solve these problems, bitcoin will have won. Right now, it works for NewEgg, Dell, or Expedia. I'm placing an order online and I don't expect the product to be delivered immediately. But when I can pay at the pump in bitcoin, what do you think that does for transaction numbers? Adoption? Price?
Gas is a perfect use case. I want this to happen.
Suppose that your idea gets adopted by certain countries which are the recipients of remittances, then bitcoin sent home from say the USA, could be used for another transaction before needing to be exchanged. As more and more vendors accept bitcoin, then perhaps a tipping point will be reached beyond which the need to exchange into fiat will diminish.
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vuduchyld
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September 04, 2014, 04:33:26 AM |
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. . .
Which is why I have been thinking a lot about the use case of buying gasoline with bitcoin. I don't mean using Qora or CoinFueled or some other card that a merchant processes at 3.75%, I mean actually buying gas using my bitcoin wallet and a QR code or some other native-to-the-gas-pump bitcoin technology.
I've done quite a bit of consulting with c-stores and I can assure you that gas is a super low-margin item for them. There is motivation for them to save 3% (or sometimes more) off of processing costs. It is real money to these store owners.
It's a real win-win. If I could buy gas with bitcoin, most of the time, I'd most likely just replenish my bitcoin stock with a purchase matching what I just spent. Merchants could, theoretically, offer some discount that would allow me to share in the savings they realize. Great for adoption, great for consumers, great for merchants, great for the community, even if the merchants are using bitpay and converting to fiat at purchase time.
There are some technical details that make this tough. Confirmation times. Native infrastructure. When we can realistically solve these problems, bitcoin will have won. Right now, it works for NewEgg, Dell, or Expedia. I'm placing an order online and I don't expect the product to be delivered immediately. But when I can pay at the pump in bitcoin, what do you think that does for transaction numbers? Adoption? Price?
Gas is a perfect use case. I want this to happen.
Suppose that your idea gets adopted by certain countries which are the recipients of remittances, then bitcoin sent home from say the USA, could be used for another transaction before needing to be exchanged. As more and more vendors accept bitcoin, then perhaps a tipping point will be reached beyond which the need to exchange into fiat will diminish. Awesomeness. Now all we need to do is design the pump or figure out how to make an add-on. Of course, it's a chicken-and-egg question. Merchants would have to believe that there would be enough adoption to pay for the capital cost of the improvement. If they felt the demand would be there and the savings from processing costs would pay for it, there would be some percentage that would do it. I wonder how we could find geographic hot spots with bitcoin user density to serve as a testing ground?
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RAJSALLIN
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September 04, 2014, 07:49:22 AM |
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this is the reason i don't believe in altcoins, bitcoin can just adapt and make altcoins obsolete.
No, and i´ve given some thought to this. The blockchain gives a provable accountability to people who choose so. Obviously that completely contradicts anonymity. However that may be very usefull. And yes, i´ve been trying to advocate that, but it really seems creating an alternate chain for "restricted" purchases is the better way to go. Do you think it actually matters how much a "coin" is worth if that "coin" is the aquivalent of "allow one purchase" of "restricted good" (be it a weapon, medicament, whatever). That coin can be signed by the transmitter. Geez, it doesnt even matter if its premined. If it just allows you to purchase things online you usually couldnt. Dont get me wront. Bitcoin would have been a really cool thing. Well, if it had come *before* Paypal etc.. We already have an online payment system. Costing a whole lot more (3% of the sale plus ~30 cent fixed vs. ~5 cent), and being a nightmare for merchants because of conflict resolution by default going in favor of the customer. Which is why I have been thinking a lot about the use case of buying gasoline with bitcoin. I don't mean using Qora or CoinFueled or some other card that a merchant processes at 3.75%, I mean actually buying gas using my bitcoin wallet and a QR code or some other native-to-the-gas-pump bitcoin technology. I've done quite a bit of consulting with c-stores and I can assure you that gas is a super low-margin item for them. There is motivation for them to save 3% (or sometimes more) off of processing costs. It is real money to these store owners. It's a real win-win. If I could buy gas with bitcoin, most of the time, I'd most likely just replenish my bitcoin stock with a purchase matching what I just spent. Merchants could, theoretically, offer some discount that would allow me to share in the savings they realize. Great for adoption, great for consumers, great for merchants, great for the community, even if the merchants are using bitpay and converting to fiat at purchase time. There are some technical details that make this tough. Confirmation times. Native infrastructure. When we can realistically solve these problems, bitcoin will have won. Right now, it works for NewEgg, Dell, or Expedia. I'm placing an order online and I don't expect the product to be delivered immediately. But when I can pay at the pump in bitcoin, what do you think that does for transaction numbers? Adoption? Price? Gas is a perfect use case. I want this to happen. I'd like paying with bitcoins if it was cheaper to use and if it was easier to use. Think the second point is key here. If it could be used with say NFC or some other form of near field communication preferably automatic which didn't even make me take my phone up that would be a system I could see really catch on. Automation is the future and bitcoin needs to be more automated than credit cards or cash.
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Ruthful
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September 04, 2014, 07:52:01 AM |
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Costing a whole lot more (3% of the sale plus ~30 cent fixed vs. ~5 cent), and being a nightmare for merchants because of conflict resolution by default going in favor of the customer.
As it stands it actually cost more to purchase online using bitcoin for me due to the additional coat of getting the bitcoins in the first place. Forget about offline purchase , no vendors here accept crypto-currencies. Accompanied by the the hassle of setting up a new system for bitcoin and it isn't exactly dummie friendly (I'm not tech savvy) ,its current uselessness for very small transaction(especially for ones within the same country) and the lack of buyer protection( I'm mainly a consumer not a merchant) ,I don't see myself using bitcoin any time soon. *snip*
That's might be actually actually a good application for bitcoin. Sort out the technical issues(someone mentioned pump POS systems?) and convince the station operators the benefits and you set to go..Pity if won't work where fuel prized is heavily regulated (heavily subsidised I my country)
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Wexlike
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September 04, 2014, 12:11:48 PM |
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If a gas station would offer gas 1cent cheaper for bitcoins, i assume people would get crazy about it in a good way. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) My friends drive up to 5 km just to find a gas station, that is a bit cheaper than the one at the next corner.
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oda.krell
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September 04, 2014, 12:25:47 PM |
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Costing a whole lot more (3% of the sale plus ~30 cent fixed vs. ~5 cent), and being a nightmare for merchants because of conflict resolution by default going in favor of the customer.
As it stands it actually cost more to purchase online using bitcoin for me due to the additional coat of getting the bitcoins in the first place. Forget about offline purchase , no vendors here accept crypto-currencies. Accompanied by the the hassle of setting up a new system for bitcoin and it isn't exactly dummie friendly (I'm not tech savvy) ,its current uselessness for very small transaction(especially for ones within the same country) and the lack of buyer protection( I'm mainly a consumer not a merchant) ,I don't see myself using bitcoin any time soon. That's a valid point. I will add that I think it's not 100% accurate (see my remarks at the end of this post), but in principle, I see what you mean and agree. Note however that I talked about "transaction costs", which for traditional payment systems are carried by the vendor/merchant. And from their side, it does stand as 3% + 30 cent (Paypal), 2% (Visa, but only if you're big enough) vs. 0 cost (if Bitcoin is used natively and the sender pays the tx fee). From that I conclude that there is a strong incentive to the merchant to encourage use of Bitcoin for payments. I think we will see more and more that merchants will offer some benefits to customers paying in BTC (rebate, additional service free of charge, etc.). Basically, sharing some of the 3% they save, to increase the share of their payments coming in through Bitcoin. As for the costs of acquiring Bitcoins for the consumer: I agree, it's far from ideal currently. However, you can send money to Bitstamp (free of charge, SEPA), buy coins at market for a fee of between 0.2% and 0.5%, and withdraw those coins free of charge. I said "far from ideal" because I realize that for the average consumer, using an exchange is not a "comfortable enough" option yet, with all the verification issues, counterparty risk, etc. I mention it however because it is possible, right now, to buy Bitcoins at market price and pay at most .5% premium on top of the price.
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NotLambchop
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September 04, 2014, 01:05:03 PM |
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... Note however that I talked about "transaction costs", which for traditional payment systems are carried by the vendor/merchant. And from their side, it does stand as 3% + 30 cent (Paypal), 2% (Visa, but only if you're big enough) vs. 0 cost (if Bitcoin is used natively and the sender pays the tx fee). ... This is a bit of a tangent, but might be interesting. Was interesting to me when I first read it, wish I could give credit, but can't remember who pointed this out.[/sheepish disclaimer] Bitcoin transaction costs are currently sponsored by Bitcoin inflation, which [now] is quite a bit higher than 3%. Once all the coins are mined, and miners no longer profit through mining coin, I think it's reasonable to assume that tx fees would go up substantially (along with a bunch of other untidiness that I don't like to think about ![Cheesy](https://bitcointalk.org/Smileys/default/cheesy.gif) )
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JorgeStolfi
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September 04, 2014, 01:10:11 PM |
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As for the costs of acquiring Bitcoins for the consumer: I agree, it's far from ideal currently. However, you can send money to Bitstamp (free of charge, SEPA), buy coins at market for a fee of between 0.2% and 0.5%, and withdraw those coins free of charge.
Can't he use SEPA to pay the merchant? (Honest question, I don't know the answer.) I understood that Dell accepts payment by check or bank transfer for orders placed by mobile or e-mail. Not clear why this restriction, or whether it is a restriction: do they say that because no client would use those slow means if they can pay "instantaneously" by credit card?
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Academic interest in bitcoin only. Not owner, not trader, very skeptical of its longterm success.
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rebuilder
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September 04, 2014, 01:12:34 PM |
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This is a bit of a tangent, but might be interesting. Was interesting to me when I first read it, wish I could give credit, but can't remember who pointed this out.[/sheepish disclaimer] Bitcoin transaction costs are currently sponsored by Bitcoin inflation, which [now] is quite a bit higher than 3%. Once all the coins are mined, and miners no longer profit through mining coin, I think it's reasonable to assume that tx fees would go up substantially (along with a bunch of other untidiness that I don't like to think about ![Cheesy](https://bitcointalk.org/Smileys/default/cheesy.gif) ) Perhaps, or miners will shut off for lack of profits until the transaction fees are sufficient to sustain the hashrate. Whether that hashrate will then remain resilient against attack is an open question. IIRC, Satoshi's vision had institutions with vested interest in BTC providing hashing power to secure their investment, not to gain profits from transaction fees directly.
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Selling out to advertisers shows you respect neither yourself nor the rest of us. --------------------------------------------------------------- Too many low-quality posts? Mods not keeping things clean enough? Self-moderated threads let you keep signature spammers and trolls out!
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oda.krell
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September 04, 2014, 01:29:13 PM |
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As for the costs of acquiring Bitcoins for the consumer: I agree, it's far from ideal currently. However, you can send money to Bitstamp (free of charge, SEPA), buy coins at market for a fee of between 0.2% and 0.5%, and withdraw those coins free of charge.
Can't he use SEPA to pay the merchant? (Honest question, I don't know the answer.) I understood that Dell accepts payment by check or bank transfer for orders placed by mobile or e-mail. Not clear why this restriction, or whether it is a restriction: do they say that because no client would use those slow means if they can pay "instantaneously" by credit card? Some companies allow this (at least in Europe), some prefer other payment providers, probably because of conflict resolution / protection from charge backs. Don't underestimate how much merchants are willing to pay to be protected from the hassle of having to deal with (fraudulent or justified, doesn't matter) reversal of payments. Visa has charge back as well of course, but in my experience, they're rather thorough and don't automatically side with the payer against the payee. Bitcoin transfers turn it around, the merchant is now firmly favored: no costs, no way to reverse the transaction. Which means that, a) the merchant hopes to get some "easy" revenue from old coin holders / early adopters, at little cost and risk (your hypothesis, as far as I know), or b) the merchant eventually will have to offer additional benefits to customers paying in Bitcoin to compensate for the loss of customer protection that customers enjoy using traditional payment methods.
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oda.krell
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September 04, 2014, 01:39:41 PM |
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... Note however that I talked about "transaction costs", which for traditional payment systems are carried by the vendor/merchant. And from their side, it does stand as 3% + 30 cent (Paypal), 2% (Visa, but only if you're big enough) vs. 0 cost (if Bitcoin is used natively and the sender pays the tx fee). ... This is a bit of a tangent, but might be interesting. Was interesting to me when I first read it, wish I could give credit, but can't remember who pointed this out.[/sheepish disclaimer] Bitcoin transaction costs are currently sponsored by Bitcoin inflation, which [now] is quite a bit higher than 3%. Once all the coins are mined, and miners no longer profit through mining coin, I think it's reasonable to assume that tx fees would go up substantially (along with a bunch of other untidiness that I don't like to think about ![Cheesy](https://bitcointalk.org/Smileys/default/cheesy.gif) ) Right. I'm highly skeptical towards statements made today that claim that tx fees will always be negligible. I will however also note the following: together with the "OMG, a deflationary currency can NEVER work!" argument, the 'tx fees after emission is over' concern is placed pretty far into the future (~2140 to be precise). You can call my reference to this short-sighted, but I think it is just another example of Satoshi's economic brilliance: some of the less palatable elements from a perspective of current economical orthodoxy are coming into existence only far enough into the future that the orthodoxy has a chance to change by then. A bit more technical, a bit less flippant: ultimately, tx fees after emission is done will gravitate towards: total cost of running network * share of current transaction of total transactions on network, plus a small premium to make it worth miners time and effort. I don't see this as ever being more costly than current commercial payment providers, similarly to how there is no cheaper operating system than, say, Linux.
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Not sure which Bitcoin wallet you should use? Get Electrum!Electrum is an open-source lightweight client: fast, user friendly, and 100% secure. Download the source or executables for Windows/OSX/Linux/Android from, and only from, the official Electrum homepage.
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NotLambchop
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September 04, 2014, 01:47:01 PM |
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... Perhaps, or miners will shut off for lack of profits until the transaction fees are sufficient to sustain the hashrate. Whether that hashrate will then remain resilient against attack is an open question. IIRC, Satoshi's vision had institutions with vested interest in BTC providing hashing power to secure their investment, not to gain profits from transaction fees directly.
What sort of institutions? ![](https://ip.bitcointalk.org/?u=http%3A%2F%2Fs27.postimg.org%2Ffj57r5hkz%2FCapture.jpg&t=665&c=JjV5K4b0rsybXQ) Kidding, but if you mean "invisible to the end user (consumer)," credit cards do that.
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NotLambchop
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September 04, 2014, 02:03:17 PM |
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..."OMG, a deflationary currency can NEVER work!" argument...
I don't think you're presenting the argument against deflationary currencies in the best light [smiley]. It is an argument that predates Bitcoin by at least a century, and one at the root of *every economy on Earth.* Not just the orthodoxy. At least what I know of it has nothing to do with tx fees. ...tx fees after emission is done will gravitate towards: total cost of running network * share of current transaction of total transactions on network, plus a small premium to make it worth miners time and effort. I don't see this as ever being more costly than current commercial payment providers, similarly to how there is no cheaper operating system than, say, Linux.
Considering that today's cost of running the network is around the value of all the coins mined, I see no reason to make this assumption. Re. "no cheaper operating system than, say, Linux": Why do you suppose major corporations use Windoze? Stupid? Like Bill? Don't care about profits?
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Ruthful
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September 04, 2014, 02:54:29 PM |
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However, you can send money to Bitstamp (free of charge, SEPA).
Unfortunately SEPA don't cover South East Asian countries (I'm in one) so there goes that option.So yeah, still not seeing any benefit of doing transaction in bitcoin for me at this point .Lets hope there'll be improvements that will change my mind in the future.
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oda.krell
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September 04, 2014, 03:03:47 PM |
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..."OMG, a deflationary currency can NEVER work!" argument...
I don't think you're presenting the argument against deflationary currencies in the best light [smiley]. It is an argument that predates Bitcoin by at least a century, and one at the root of *every economy on Earth.* Not just the orthodoxy. At least what I know of it has nothing to do with tx fees. ...tx fees after emission is done will gravitate towards: total cost of running network * share of current transaction of total transactions on network, plus a small premium to make it worth miners time and effort. I don't see this as ever being more costly than current commercial payment providers, similarly to how there is no cheaper operating system than, say, Linux.
Considering that today's cost of running the network is around the value of all the coins mined, I see no reason to make this assumption. Re. "no cheaper operating system than, say, Linux": Why do you suppose major corporations use Windoze? Stupid? Like Bill? Don't care about profits? Maybe I didn't phrase that all too clear: I lumped together those two issues (tx fees post-emission, deflationary currency) to make the point that several contentious issues will only arise in reality well into the future, potentially giving us time to adapt / get used to them. re: deflationary currency. Don't be mistaken, I'm not brushing aside the complexities of the issue. I do however claim that, current economical orthodoxy considers central bank guided inflationary currencies the de facto optimum. Agreed with that statement? Not that they're optimal, but that the vast majority of economists seem to consider fixed supply currencies broken beyond repair. My point is not that a deflationary currency is necessarily better (sorry PMers), but that it will be an interesting experiment in about 100 years from now to see if modern economical development is really impossible with a deflationary currency (if Bitcoin does indeed become a major factor in global finance in the future). re: Linux. Wasn't the point who is using it. We were talking price. (and I'm sure you know this, but while consumers barely use Linux, the Internet infrastructure relies heavily on it.)
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mmortal03
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September 04, 2014, 03:20:08 PM |
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..."OMG, a deflationary currency can NEVER work!" argument...
I don't think you're presenting the argument against deflationary currencies in the best light [smiley]. It is an argument that predates Bitcoin by at least a century, and one at the root of *every economy on Earth.* Not just the orthodoxy. At least what I know of it has nothing to do with tx fees. ...tx fees after emission is done will gravitate towards: total cost of running network * share of current transaction of total transactions on network, plus a small premium to make it worth miners time and effort. I don't see this as ever being more costly than current commercial payment providers, similarly to how there is no cheaper operating system than, say, Linux.
Considering that today's cost of running the network is around the value of all the coins mined, I see no reason to make this assumption. Re. "no cheaper operating system than, say, Linux": Why do you suppose major corporations use Windoze? Stupid? Like Bill? Don't care about profits? Maybe I didn't phrase that all too clear: I lumped together those two issues (tx fees post-emission, deflationary currency) to make the point that several contentious issues will only arise in reality well into the future, potentially giving us time to adapt / get used to them. re: deflationary currency. Don't be mistaken, I'm not brushing aside the complexities of the issue. I do however claim that, current economical orthodoxy considers central bank guided inflationary currencies the de facto optimum. Agreed with that statement? Not that they're optimal, but that the vast majority of economists seem to consider fixed supply currencies broken beyond repair. My point is not that a deflationary currency is necessarily better (sorry PMers), but that it will be an interesting experiment in about 100 years from now to see if modern economical development is really impossible with a deflationary currency (if Bitcoin does indeed become a major factor in global finance in the future). re: Linux. Wasn't the point who is using it. We were talking price. (and I'm sure you know this, but while consumers barely use Linux, the Internet infrastructure relies heavily on it.) Not to mention that, in terms of divisibility, until digital currencies came along, with decimal places that could be extended out, a deflationary currency wasn't practically implementable past a certain point. Physical currencies can only be split so much into smaller units, printed, and distributed, to maintain liquidity.
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oda.krell
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September 04, 2014, 03:27:48 PM |
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Not to mention that, in terms of divisibility, until digital currencies came along, with decimal places that could be extended out, a deflationary currency wasn't practically implementable past a certain point. Physical currencies can only be split so much into smaller units, printed, and distributed, to maintain liquidity.
Excellent point. This might not capture 100% of the "hoarding" / deferred spending problem economists like Krugman like to throw at fixed supply models, but it probably accounts for a substantial part of it. If you can spend an appropriately small fraction of something extremely valuable you are at the very least more likely to do so than someone who fears overspending, because of insufficient (and possibly intransparent) divisibility.
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zimmah
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September 04, 2014, 03:39:27 PM |
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it's pretty funny how many people talk about the hypothetical problem of deflationary currency, even though we have never really used deflationary currency.
While at the same time you never hear anyone complain about the problems of an economy based on exponential inflation. Like the earth can sustain exponential growth.
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