Does anyone actually use Bitcoin to pay for things?

'Bits' = micro-bitcoins = μBTC = 0.000001 btc
So at the current prices, its about 1,5 cent of a euro.
Wallets and exchanges should be starting to show bits as default unit of account.
So like, 333 bits for a pint? :D

Anyhow, euro is our unit of account, so if anyone wants to accept payment in something else there would be some math involved to figure out exchange rates, be it bitcoin, kronas or whatever.
A fiver will be pretty much the easiest solution, let the bartender serve the next customer already!
 
MrEarl said:
House in UK sold for Bitcoins !

See here
Click to expand...

There’s no word on what the final price in Bitcoin is to be paid, but we do know that the buyer is a Bitcoin miner who made a great deal of money on the cryptocurrency by getting in on it early and is now looking to convert the digital cash into brick-and-mortar reality.

The miner probably can't convert it to real money!

In fairness to the miner, s/he has done very well, getting a house for nothing! That seller better sell quick...
 
ant dee said:
A fiver will be pretty much the easiest solution, let the bartender serve the next customer already!
Click to expand...

And that's my point! Why would anyone bother going to the trouble of paying in Bitcoin :
  • Doing the calculation
  • Checking if I have enough Satoshis (trying to keep a straight face) in my account
  • Making the payment & checking that it went true correctly
When I can slip my barman a fiver and start enjoying my pint

Why bother with Bitcoin????
 
Well, maybe we shouldn't bother.
Buying pints isn't really gonna work with bitcoin... at the moment.

A fiver is easier than paying with a €50 and waiting for the change.
Does that make €50 notes useless? Why bother with €50? Well, a €50 note can serve more purposes.

Same with a credit card, right? A fiver beats a credit card for paying for a pint!
At least until the banks innovated and made contactless payments.
Now, after some setup from the merchant and the customer, a contactless card is even easier than a fiver.
It required a lot of work from the banks and we had fivers already, why did the banks bother?
Because the initial work put into it doesn't matter to us using it, banks enjoy the increased volumes and we just enjoy the end product. (by the way I don't even use contactless, but it sounds like the fastest easiest way to pay exactly for a pint).

Now, we had to wait for the banks to innovate and improve credit cards.
With bitcoin we don't have to wait for anyone. Anyone can start creating an app that makes paying for pints easier.
And you can even use hardware technology that's already in place, like the current smartphones that are circulating. There might be no need to buy a new POS or order plastic cards.

Overly simple example.
Although the current high network fees make it all useless, lets assume network fees are like €0.05. The merchant will be happier to pay that 1% than the banking fees.
It is possible to make an app that does the following:

Merchant app
  • Tie the price to the unit of account of your choice, be it € or oz of gold or whatever
  • Real time convert the equivalent in bitcoin ( or other cryptocurrency)
  • Broadcast a payment request
Customer app
  • Store money, arguably not very securely but your cash in your pocket isnt really secure either
  • Display in your choice of unit of account (maybe I believe in 'North Korean won' and account my net worth there :D )
  • Read a payment request, maybe convert it on display in your choice of currency, using live markets data.
  • Pay it, or not.
Of course you need to add more functions, details, add limits, require prompts, different broadcast methods, like displaying QR code, or simply tapping a phone to one another (NFC?)
Point is it will happen, because bitcoin is programmable money and people will be building apps for it non stop. Its all open source, people will build and others will build on top and improve.
And once someone makes it good enough, if its easier then the fiver or the contactless card, we can simply start using it.
Or not.
Bitcoin is voluntary, noone is forced to use it.
 
ant dee said:
Well, maybe we shouldn't bother.
Buying pints isn't really gonna work with bitcoin... at the moment.

A fiver is easier than paying with a €50 and waiting for the change.
Does that make €50 notes useless? Why bother with €50? Well, a €50 note can serve more purposes.

Same with a credit card, right? A fiver beats a credit card for paying for a pint!
At least until the banks innovated and made contactless payments.
Now, after some setup from the merchant and the customer, a contactless card is even easier than a fiver.
It required a lot of work from the banks and we had fivers already, why did the banks bother?
Because the initial work put into it doesn't matter to us using it, banks enjoy the increased volumes and we just enjoy the end product. (by the way I don't even use contactless, but it sounds like the fastest easiest way to pay exactly for a pint).

Now, we had to wait for the banks to innovate and improve credit cards.
With bitcoin we don't have to wait for anyone. Anyone can start creating an app that makes paying for pints easier.
And you can even use hardware technology that's already in place, like the current smartphones that are circulating. There might be no need to buy a new POS or order plastic cards.

Overly simple example.
Although the current high network fees make it all useless, lets assume network fees are like €0.05. The merchant will be happier to pay that 1% than the banking fees.
It is possible to make an app that does the following:

Merchant app
  • Tie the price to the unit of account of your choice, be it € or oz of gold or whatever
  • Real time convert the equivalent in bitcoin ( or other cryptocurrency)
  • Broadcast a payment request
Customer app
  • Store money, arguably not very securely but your cash in your pocket isnt really secure either
  • Display in your choice of unit of account (maybe I believe in 'North Korean won' and account my net worth there :D )
  • Read a payment request, maybe convert it on display in your choice of currency, using live markets data.
  • Pay it, or not.
Of course you need to add more functions, details, add limits, require prompts, different broadcast methods, like displaying QR code, or simply tapping a phone to one another (NFC?)
Point is it will happen, because bitcoin is programmable money and people will be building apps for it non stop. Its all open source, people will build and others will build on top and improve.
And once someone makes it good enough, if its easier then the fiver or the contactless card, we can simply start using it.
Or not.
Bitcoin is voluntary, noone is forced to use it.
Click to expand...

That is an excellent post.

I think you have outlined how Bitcoin could be used in the future. By making it cheaper for shops, there will be very interested as POS charges are very high. By developing an easy-to-use and secure app there is a willing end user.....

I am probably looking at the current uses of Bitcoin without looking down the road. If the Bitcoin value does stabilise then what you have outlined could well work.

Firefly.
 
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Firefly said:
That it an excellent post.

I think you have outlined how Bitcoin could be used in the future. I am probably looking at the current uses of Bitcoin without looking down the road. If the Bitcoin value does stabilise then what you have outlined could well work.

Firefly.
Click to expand...
Thank you.
I would go as far as to say that while the volatility would prevent me and you from using this app, it doesn't mean it cant work.
All you need really is one person to develop it, one merchant who is not bothered by the volatility (a believer??) and one customer willing to spend cryptocurrencies.
And the network can grow from there.
 
Contactless credit card is brilliant. I don't think I have used any M0 in weeks. I toddle each day to my local shop and buy the IT for €2. Contactless credit card suits us both. Sure BTC might come to be nearly as slick, but it will never be a cause for demand for BTC, at best it will reduce a current serious disadvantage it has over conventional money transmission.

Just to reaffirm a one liner in ant dee's post. Current transaction costs for a cup of coffee are over $20. So transactions in BTC are limited to one miner buying a house in Essex and possibly some underground stuff we don't get to hear about.

Don't confuse transactions in BTC with transactions involving BTC to fiat to retailer.
 
Duke of Marmalade said:
Current transaction costs for anything are over $20.
Click to expand...
The size of a transaction is measured in bytes. Keeping it simple, it probably wont matter if you send €5 or €5k in bitcoin, you pay the same fee. Negligible fee to buy a house, yes.

Duke of Marmalade said:
Don't confuse transactions in BTC with transactions involving BTC to fiat to retailer.
Click to expand...
I don't get this line, currently in order to get fiat you have to make a BTC transaction to the entity willing to give you fiat for it. There is no practical solution at the moment to transfer ownership of a certain BTC amount without using the BTC network and paying for at least one transaction.
 
ant dee said:
I don't get this line, currently in order to get fiat you have to make a BTC transaction to the entity willing to give you fiat for it.
Click to expand...
I was preempting any folk saying some online retailers are accepting BTC. They are not. They are facilitating the conversion of BTC at spot into the currency they are pricing at. Is anybody (significant) quoting BTC prices?

I understand Richard Branson will accept BTC for space travel when he gets it up and running. That all sounds very cool but watch his interview - he is careful to say that he is not sure he would hold on to it. So RB the great champion of BTC will accept it as a gimmick but will quickly exchange for real currency.

What about the other supposed champion, Bill Gates? I watched his interview also. He sees possibilities for the blockchain technology to provide financial services to the unbanked in the Third World (one of his pet causes). He already champions mobile banking for that constituency and from what I read BTC per se has no edge over that. Au contraire, it is difficult to see a Kenyan farmer having the same confidence in a virtual currency that some Western nerds seem to have.
 
There are fundamental contradictions here. BTC proponents argue that ultimately it will have value as a transactional currency. They admit that it certainly has no traction in that role at present. And with $20 a transaction it has no hope of getting traction. But, the argument goes, these high transaction fees are because of the current price and the current cost of puzzle solving.

Once the BTC stabilizes (i.e. falls to stable levels) the transaction fees will become manageable - this is only a temporary blip. Doesn’t that say that BTC will only be the success its fans predict when the price falls to levels that transaction fees are reasonable. That all looks contradictory to me.
 
Duke of Marmalade said:
And with $20 a transaction it has no hope of getting traction. But, the argument goes, these high transaction fees are because of the current price and the current cost of puzzle solving.
Click to expand...
No! and this is important, the high transaction fees are due to the transaction limit per block. Imagine the bus comes every 10 minutes and has a limited number of seats, those waiting at the bus stop willing to pay the most get the seats.

Duke of Marmalade said:
Once the BTC stabilizes (i.e. falls to stable levels) the transaction fees will become manageable - this is only a temporary blip. Doesn’t that say that BTC will only be the success its fans predict when the price falls to levels that transaction fees are reasonable. That all looks contradictory to me.
Click to expand...
The market price of bitcoin going down won't necessarily affect the number of transactions people are making, except that it might signal that some users are leaving.

The hard cap of about 400k transaction per day is a fixed cap until a solution to support more is developed. This is regardless of the price of a bitcoin.
 
fpalb said:
No! and this is important, the high transaction fees are due to the transaction limit per block. Imagine the bus comes every 10 minutes and has a limited number of seats, those waiting at the bus stop willing to pay the most get the seats.
Click to expand...

That sounds like a fairly fundamental design flaw.

A bus which charges people the same price would get my business.

Brendan
 
Its a free market, no one is forcing anyone to ride that bus.
There are other busses to choose from.
 
Firefly said:

The miner probably can't convert it to real money!
Click to expand...

How did you make that leap? It's incredibly easy to turn Bitcoin into fiat currency (even millions), literally a few mouse clicks. Considerably easier than property, shares, etc etc.
 
The point being it was the first transaction of it's type ... not to say it was or will be the only one.
 
so if I had say 10 bitcoins could I be able to exchange them for $ at the rate of exchange on offer at the moment.
 
Yes, but if you wanted publicity for your self or your business why not look for something costing $180k and pay in Bitcoin?

Brendan
 
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