That's a terrible idea. Bitcoin is difficult to use for both buyer and seller, has high transaction costs, and is associated in the minds of many customers with illegal transactions.
All that is secondary though to the extreme lack of stability of value, which is pretty important in a medium of exchange. You might as well be telling him to accept tulips.
I'm a fan of bitcoin, but in this case I disagree. It is safer to sell things on the internet if you accept bitcoin, but it's more risky if you're the buyer. You can chargeback a credit card if you don't get what you paid for. You can't get your bitcoin back.
From a practical standpoint (which is literally what he asked for), using a bitcoin as the sole method of payment is likely to artificially limit your potential customer-base. Bitcoin isn't widespread enough where most consumers can be expected to utilize them for payment. You may create a phenomenal web service, only to see it fail because people can't figure out how to pay for its use.
Thanks. To me, it seems like bitcoin solves the problem of the buyer being bogus, but doesn't solve the problem of the seller being bogus. For instance the Nigerian prince might order an iPhone with bitcoins, and never see his iPhone.
There's probably no such thing as a risk free commercial transaction. The next best thing is if somebody assumes the risk and charges an amount that covers the risk plus makes it worth their while.
> There's a huge savings in accepting payments in a form that the buyer can't reverse.
Bitcoin just kind of flips the problem, it doesn't solve it. In a world where payments can easily be reversed, sellers take on all the risk. In a world where they can't be, buyers take all the risk.
You can get pretty far with a reputation system, and in a market with many more buyers than sellers it's nice that now only the seller's reputation matters. But for a lot of people there's still benefit in having a trusted middleman like Paypal.
Eh? The volatility is a HUGE problem for bitcoin as a currency.
If I run a small business, accepting payment in bitcoin just creates risk. The state of my business not only depends on the quality and success of my product/service but also on the volatility of bitcoin because by accepting bitcoin I am forced to effectively take a long position on BTC. The price could crash by 25% before I sell the bitcoin and now I've a cash-flow problem - struggling to pay wages and rent - even though my business is successful in that I made a profit on selling my products or services.
The purchaser of my services is effectively on the other side of this trade and is exposed to the opposite risk wrt to BTC/USD. The only way for the two parties to minimize this risk would be for the customer to convert fiat currency into bitcoin just before paying, and then for the vendor to convert the bitcoin back immediately on receipt. With high spreads and transaction costs, using bitcoin in this manner is incredibly expensive and makes no business sense.
Because Bitcoin transactions are not able to be reversed, buying them is notoriously difficult online, as fraudsters like to buy them with stolen credit cards. (Of course, this means that almost nobody sells Bitcoins for PayPal/credit cards/etc. due to chargeback risk.)
It's much better to deal with someone you know, or, failing that, someone with existing reputation. I was hoping to make life easier for fellow HN scenesters.
A handful of people have requested that I add Bitcoin as a payment option to my store. But when I offered these people to purchase my app with Bitcoin, none of them actually bought a license.
As much as I like the idea of Bitcoin, it just doesn't seem like people really use it for buying legal things.
No sites actually accept Bitcoin, they partner with companies that convert them to human dollars. The volatility against the currency their suppliers use and the government uses for taxes makes it entirely impractical not to.
There’s substantially one merchant that accepts Bitcoin: bitpay, and all sorts of merchants happy to take bitpays actual money.
Look if the customer wants to pay a $20 transaction fee to buy something, and an hour to confirm, and bitpay is willing to deal with this absolute garbage situation and turn them into dollars for me for 1% what kind of merchant would say no? The fact any are saying no speaks volumes to be honest.
I guess you won't complain when I cut off one of your arms, since some other guy lost all four limbs in a car accident...
Unfortunately, even if he accepted bitcoin, probably less than a tenth of a percent of customers would pay with bitcoin. I agree though, that would be better.
Nobody accepts it as payment, because its value is too volatile, speculation-driven, and nobody wants to spend it, because it is deflationary.
And that's not even considering the fact that it can only be transferred at around 6 transactions per second, less than 1/10,000th of the transaction volume of Visa.
"There would be no advantage over just trading with bitcoins" for me the purchaser there very much is, because in case the person at the far end is a scammer I have, in theory, at least some recourse.
Or if you treated credit-card bitcoin purchases as options. On the surface it's not a good idea for someone to accept credit cards for bitcoins, but why can't I use my credit card to purchase BTC at the current rate for, say, April 15 delivery? Of course, now I have to trust the seller to follow through, but that's a tractable problem that can be solved with either reputation-based trust or escrow services.
All that is secondary though to the extreme lack of stability of value, which is pretty important in a medium of exchange. You might as well be telling him to accept tulips.
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