8 ms·

Microsoft Store doesn't accept Bitcoin anymore

101 points by mathieutd 11y ago

echelon 11y ago
Does anyone have any idea why this is? Have companies moved on from considering Bitcoin something serious? I imagine their Bitcoin code was too expensive to maintain relative to the transaction volume it brought. Could this be a sign of things to come from other companies that support Bitcoin, and if others follow in Microsoft's footsteps, does this impact Bitcoin at all?
- ethagknight 11y ago
  Or could it be related to real/perceived risk in holding and trading bitcoins?
- Kenji 11y ago
  It's not just that. By accepting bitcoin, even if you change them to USD right away, you run a currency risk if BTC suddenly loses value. Also, when is a BTC transaction validated? Yeah, they have eventual consistency, but doublespending is actually possible. How long must the chain be after a transaction for it to be valid? These are nontrivial questions and tradeoffs that the store owner has to do about risks.
  - jsprogrammer 11y ago
    Transactions are valid only when you trust you have the longest chain. If a longer chain comes along, you may abandon the shorter chain and believe the longer chain.
    - Kenji 11y ago
      Exactly. But when do you trust you have the longest chain? It could be that by some stroke of misfortune or malicious manipulation, a shorter chain suddenly catches up. Is a chain that is 10 links longer safe? As I said - eventual consistency. But when is eventually? This is a real issue for BTC transaction validation.
      - jcoffland 11y ago
        If the senaro you describe were remotely possible BitCoin would not exist. A chain more than a couple of blocks behind has almost no chance of catching up unless over 50% of the hashing power consolidated on the shorter chain. Since miners automatically abandon short chains and it is in their best interest to do so this is extremely unlikely.
        the_mitsuhiko 11y ago
        What if mining pools would deliberately hold back mint blocks until they find more? That way they could invalidate transactions if they like.
        jsprogrammer 11y ago
        You can only hold a mint block until right before another block arrives. Once another block is known your mint block is garbage.
        the_mitsuhiko 11y ago
        > You can only hold a mint block until right before another block arrives. Once another block is known your mint block is garbage. What controls this?
        jsprogrammer 11y ago
        Each block must incorporate the hash from the previous block.
        the_mitsuhiko 11y ago
        So what stops you from mining ahead secretly?
        11y ago
- elorant 11y ago
  Could be related to recent development in Bitcoin as it reaches the 1MB limit and transactions take up to ten hours to be cleared.
- valhalla 11y ago
  If the Microsoft was liquidating bit coin the way planetjones describes, it was probably too inconvenient since the exchange rate (Bitcoin to $) would fluctuate so unpredictably and wildy (at times) there was no way to reliably exchange bitcoins for the exact amount customers were charged. If the exchange rate was too low, MSFT would lose money. If it was too high, they'd be breaking a number of very basic but important laws that are designed to protect consumers.
  - valhalla 11y ago
    November 29th 2013 (A week after the Xbox One release) 1 Bitcoin == $1216.73. By December the same year the price "[had] crashed to $600, rebounded to $1,000, crashed again to the $500 range. Stabilized to the ~$650–$800 range." Here's a graph showing the rate from July '13 to June '15: https://en.wikipedia.org/wiki/History_of_Bitcoin#/media/File.. https://en.wikipedia.org/wiki/History_of_Bitcoin#/media/File....
  - LukeHoersten 11y ago
    Microsoft did liquidate to USD right away using a company called BitPay. BitPay would take on the short term price risk and Microsoft would get exactly what they quoted in USD. Microsoft was not subject to BTCUSD price fluctuation in this scheme.
  - bunderbunder 11y ago
    That said, just by eyeballing some graphs at Coinbase it looks to me like the exchange rate was a more volatile back when Microsoft started accepting Bitcoin than it is now. Which isn't to say that they couldn't reasonably decide that it's too volatile, but it does seem odd that they'd do so while the volatility's dropping rather than increasing. I'm inclined to guess that all the BTC in the news just led them to a more fundamental reconsideration of their bet that it is (or will become) a viable unit of exchange. There are a lot of take-aways you could get from recent events that might lead to that decision, but the most fundamental one is simply that it's become clear that a huge portion of the people controlling Bitcoin's future don't want it to become one.
- LukeHoersten 11y ago
  My guess is that they gave it a try and the purchase volumes never materially compared to credit card payments. Integration was done very poorly. You had to go to a special link "commerce.microsoft.com" and click on a small, un-styled link at the bottom of the page called "Redeem bitcoins". It was never integrated in to their main purchase flow in an easy way. It couldn't be found just by chance. You had to google to figure out how to fund with bitcoin. Edit: There are a handful of comments about price fluctuation. Microsoft liquidated to USD right away using a company called BitPay. BitPay would take on the short term price risk and Microsoft would get exactly what they quoted in USD. Microsoft was not subject to BTCUSD price fluctuation in this scheme.
- the_mitsuhiko 11y ago
  > Does anyone have any idea why this is? I wouldn't be surprised if they had a contract with a payment provider that was just too expensive for the little to no revenue that came in via bitcoin. Other than people that got bitcoin early there are not really any bitcoin users out there. Also pretty sure that handling refunds and customer support for failed payments must have been pretty involved.
- eterm 11y ago
  Almost certainly just low volume. Most merchants offering sale by bitcoin had little to no use. And it makes sense, most bitcoin owners bought to speculate. Spending bitcoin isn't that different to just selling the bitcoin and spending with actual money, so if they weren't going to sell their bitcoin, why spend their bitcoin? It's not like middlemen payment processors were avoided, most companies accepting bitcoin actually just accepted through a third party who would liquidate it back to money directly.
- stevewilhelm 11y ago
  > Does anyone have any idea why this is? I wonder about the accounting and tax ramifications of transactions done in Bitcoin.
  - pmorici 11y ago
    There really aren't any outside of the normal. A company like Microsoft isn't holding the bitcoin they are immediately exchanging it so it is no different than taking USD since they don't make any gain or loss on the BTC.
    - dheera 11y ago
      In which case there's really no point to them using bitcoin. If they're converting it to USD immediately, they derive no benefit by using a decentralized currency.
      - pmorici 11y ago
        Sure they do. There is no charge back or fraud risk for the merchant with Bitcoin. It lets you service customers that might otherwise be too risky because they happen to fit a profile that correlates to high fraud risk.
- aaachilless 11y ago
  It probably has something to do with their support of Ethereum. https://azure.microsoft.com/en-us/blog/ethereum-blockchain-as-a-service-now-on-azure/ https://azure.microsoft.com/en-us/blog/ethereum-blockchain-a...
- pash 11y ago
  Microsoft seem to be more interested in Ethereum [0]. They introduced an Ethereum blockchain-as-a-service offering on Azure [1] last year, and they are working with R3 [2] and some other Ethereum-using players in the much-hyped blockchain space. They seem to have decided that Ethereum is a better solution than Bitcoin for a broad set of applications, and they're probably right. I do think Microsoft's move is indicative of growing disaffectation with Bitcoin. Bitcoin's community has been a cauldron of discontent for the better part of two years now. It's a mess, but it's not just about the blocksize. What most scares investors and technologists is that Bitcoin's development team appears to be beholden to the interests of a single company, and still worse, has disavowed making basic changes to the protocol. But basic changes are needed to enable many of the sorts of things that people dream of doing with blockchains—at least if they're going to be done with Bitcoin's blockchain. Meanwhile Ethereum and several other competitors are maturing into good alternatives. Ethereum is a much nicer platform for programmatic money. Dash [3], Monero [4], and new projects like Zcash [5] are in some ways technically superior to Bitcoin as currencies and payment networks. At the same time, many speculators have fled bitcoin, fearing a gridlocked community and technical stasis; they've put their money into other crypto-assets, driving up their valuations. The price of ether, Ethereum's underlying asset, has skyrocketed lately, to a valuation of over $1 billion. About half a dozen altcoins have risen enormously in value over the past several months, and higher valuations bring more interest. With more interest comes more use, and with more use comes more infrastructure; Bitcoin's first-mover advantage narrows. There was a time when I thought Bitcoin would be able to incorporate proven technical improvements from other systems, and by maintaining its technical competitiveness in that way also be able to maintain its network effect. I no longer think that. If Bitcoin can't purge its demons, other systems will out-compete it. 0. https://www.ethereum.org https://www.ethereum.org 1. https://azure.microsoft.com/en-us/blog/ethereum-blockchain-as-a-service-now-on-azure/ https://azure.microsoft.com/en-us/blog/ethereum-blockchain-a... 2. https://r3cev.com https://r3cev.com 3. https://www.dash.org https://www.dash.org 4. https://getmonero.org/home https://getmonero.org/home 5. https://z.cash https://z.cash
  - deftnerd 11y ago
    Microsoft seems intent on supporting Blockchains as a service, but that doesn't mean that they're going to accept them internally on a business level. Microsoft's Blockchain platform on Azure currently supports Bitcoin, Bitshares, Ethereum, Emercoin, OpenLedger, Ripple, Factom, Eris, Coinprism, and more. Just because they now support Ethereum as a service doesn't mean that they're validating Ethereum and plan to incorporate deep within their business units. It also doesn't mean that they think it's better than Bitcoin. On a personal level, I'm quite excited by Ethereum and am more and more dejected by Bitcoin these days.
- jkyle 11y ago
  I don't think these companies ever considered Bitcoin as serious currency. More likely it's more about publicity and maintaining an image of being on the techno hipster edge.
- dinkumthinkum 11y ago
  But, and I mean this in a nice way, why would people consider Bitcoin to be something "serious" in terms of an actual currency? It is always on HN but it is like an interesting hobby for them, I guess. I also understand there are startups that have built "businesses" off of it, but it is sort of reminiscent of those businesses that sell the currencies from MMORPGs. I think Bitcoin is really meant for geeks to play with and argue and start massive flamewars over zero-knowledge proof engines and all this kind of stuff, rather than an actual real currency of the world. I guess there is an element of something like Goldbugs, but we were discussing being "serious," right?
planetjones 11y ago
My understanding was that companies accepting bitcoin like Microsoft just liquidated the BTC straight to USD anyhow. I don't blame them because of the fluctuation risk. However, I am not sure they were really helping bitcoin's long term viability - other than allowing the Bitcoin millionaires to spend their coins. I suspect not enough of these people who got rich by holding bitcoins were using their bitcoins to justify having it as a payment method in the Microsoft store.
- colejohnson66 11y ago
  Maybe it has to do with the obscene amount of time it takes for confirmations?
  - everfree 11y ago
    They probably went through an external payment processor, so they weren't exposed to the Bitcoin network or its speed/risk at all.
  - sidko 11y ago
    Why is the time obscene? It usually takes 45 days for confirmation if you pay via a credit card. Compare that to about 60 minutes for 6 confirmations on the Bitcoin blockchain, and it's orders of magnitude higher. You aren't actually comparing the few seconds it takes to swipe your credit card to 60 minute Bitcoin confirmation I hope. It's about 'reversibility' of a transaction - for a Bitcoin transaction to propagate takes about the same time as a credit card swipe to propagate. Edit: Wow why the downvotes? Seems like people here don't understand the first thing about how payments work in the real world. The funds are not 'confirmed' instantaneously. If someone walks into your store and pays you $1000 with a card, you can't say withdraw it in cash in 2 seconds. It takes about the same time for a 0-confirmation Bitcoin transaction as an 'unconfirmed' card transaction.
    - jdcarr 11y ago
      But there's a clear difference between being able to make a chargeback within 45 days and a payment system without reversible transactions. Authorising the card is instantaneous and the funds can be settled into your account within a couple of days.
deleted 11y ago
[deleted]
Crito 11y ago
I'm honestly still surprised they ever did. I wonder how much they spent implementing their ability to accept bitcoin. Probably more than they ever made in profit.
geographomics 11y ago
Unsurprising that they've ceased to accept Bitcoin. The only significant use cases thus far have been ransomware and buying recreational drugs. And early adopters cashing out of the pyramid scheme.
- jcoffland 11y ago
  And global remittances, store of wealth, international monetary system resistant to government and bank controls, to name a few other uses. It's amazing how many people are willing, even eager to dismiss crypto-currencies. The concept is so radical and revolutionary that it scares the shit out of a lot of people. It will take time for humans to catch up but if you think it's just a fad then you are deluding yourself.
  - Certhas 11y ago
    Because the problem with the international finance system really is that the regulatory controls are to strict....
  - moonbug 11y ago
    > The concept is so radical and revolutionary that it scares the shit out of a lot of people Oh please.
  - jlarocco 11y ago
    "And global remittances, store of wealth, international monetary system resistant to government and bank controls, ..." BitCoin might be taken more seriously if their advocates explained why any of those need to be solved, and how BitCoin does it better than the existing solutions. Global remittance isn't something people need very often, and there are already solutions for it. BitCoin is not a very great store of wealth. Keeping a box of cash under your bed is more likely to retain its value than BitCoin. Storing wealth isn't even a very good idea, though, and if a person has enough money laying around they'd be better off investing it anyway. Finally, being "resistant to government and bank controls" isn't very convincing either, and I would hypothesize advertising it that way actually hurts take up by making it sound subversive. A drug kingpin would love a money system resistant to the government and the banking system, but what actual benefit does a normal person get from it? And is it even a true statement?
minimaxir 11y ago
Mozilla did A/B testing last year showing that simply offering a Bitcoin option reduced the amount of donations to the org overall by 7.5% on average. http://insidebitcoins.com/news/mozilla-study-shows-bitcoin-has-negative-impact-on-donations/34466 http://insidebitcoins.com/news/mozilla-study-shows-bitcoin-h... It is possible that just associating with Bitcoin makes the consumer more skeptical.
- jordigh 11y ago
  I don't think it's about bitcoins. Wikimedia has also noticed that donations can decrease if you offer too many donation methods. They've seen this without bitcoins. Maybe donors feel like with all of those methods available someone else is already donating? Or maybe they get bewildered by the excess of choice?
  - pinum 11y ago
    Speculation: Would it help to offer two major methods (card, PayPal) prominently, and hide many more behind a small "other" link?
    - jordigh 11y ago
      This is almost exactly how Wikimedia accepts Bitcoin payments, behind an "other" link, with credit card and paypal being shown as the only two options if you click on "donate". In fact, it's kind of hard to find all of their payment options. The "other" button actually is called "problems with donating?"
  - raverbashing 11y ago
    My suspicion is that people feel it's "trying too hard" to get donations
  - NetStrikeForce 11y ago
    If it doesn't feel like a "one-click donation" I'm prone to skip it.
- deleted 11y ago
qKTDxAy4KfcOjA9 11y ago
The elephant in the room here is that Bitcoin is dodgy. It's proponents claim that it has all sorts of uses, but the only thing people actually use it for is illegal activity. Since the Ross Ulbricht trial, it has become obvious that even using it for illegal activity is a bad idea, as it's easily traceable.
- jordigh 11y ago
  Sigh, I use bitcoins to get paid for online math tutoring, and I've spent them to buy headphones online and madeleines at coffee shops. I am not just a proponent; it just so happens that bitcoins are a convenient form of international internet money for me.
- everfree 11y ago
  Ugh. I use Bitcoin to buy and sell Team Fortress 2 items, because it doesn't have the counterparty risk that something like Paypal has (and it also has lower fees for the time being). Using Bitcoin also has the advantage that I can transact with it even in countries that Paypal doesn't support, and I don't have to worry about the Paypal account freezing bs that shows up in tech news from time to time. Also it's not true that using it for illegal activity is a bad idea - the evidence that Ross Ulbricht was ultimately found and convicted on was his internet activity not related to Bitcoin. If you do it right and use mixers properly, you can make Bitcoin untraceable. So actually, Bitcoin is usable for both legal and illegal purposes, which is a gold standard for any currency.
- RaleyField 11y ago
  > The elephant in the room here is that Bitcoin is dodgy. How people use is not its intrinsic property.
- wiseleo 11y ago
  It's ahead of its time. As lines blur between nations and international commerce becomes routine, there will be a need for global currency not subject to an individual nation's laws.
pbreit 11y ago
The move is to add bitcoin to your online store, generate a bit of buzz from the gimmick and then remove it since it makes no sense.
- minimaxir 11y ago
  Adding a Bitcoin payment option is not "free," since there is non-technical overhead opportunity cost/QA/support involved with adding Bitcoin payments, even if using a payment processing API eliminates the technical overhead. It is too much effort for "a bit of buzz."
  - makomk 11y ago
    Probably the support overhead especially. The most popular Bitcoin payment provider (Coinbase) apparently fails transactions and requires manual intervention if they don't receive them within 15 minutes, and I'm not sure what they mean by receive but it happened to me despite sending payment within a couple of minutes of starting the transaction. Per the docs, they don't send any kind of API callback if this happens, just an automated e-mail telling the vendor what happened. Of course, that's an ongoing cost so it kind of makes sense to add Bitcoin for the publicity and then remove it later.
- deleted 11y ago
  [deleted]
- troymc 11y ago
  It seem you also get a bit of buzz when you remove it.
- MichaelGG 11y ago
  Accepting BTC via a company that converts it to USD immediately is great for high-risk operations. Like, suppose you sell VoIP online to anyone. You're going to have a ton of fraud. BTC allows you to work with legitimate companies and re-sellers without having to worry about credit checks. It's also handy for light hiding of your ID with respect to the store. If I purchase some degenerate online service from a company and pay using BTC, the chances of _them_ getting my actual name are far, far, less than if I use a credit card in my own name. (And buying prepaid cards is more of a hassle.)
runn1ng 11y ago
I would bet there are more people commenting here on this submission than people who ever used Bitcoin to buy anything in Microsoft Store.
- bdcravens 11y ago
  Or used Bitcoin to buy anything.
danbruc 11y ago
Bitcoin is dead and has been for years. And nobody broke it, it is just a solution without a problem. Sure, Mt. Gox, ASICs and the block size debate didn't exactly help Bitcoin, but nothing of that broke it. Yes, Bitcoin has some nice theoretical properties, but the masses don't need them. What good is an anonymous currency for buying stuff if the next thing I do is entering my shipping address? Whether the system is decentralized or centralized, the average user doesn't give a shit as long as it works. I don't have to trust a bank? I don't care, I never had any issues. And with Bitcoin I have to trust every single seller, no way to charge back in case they don't deliverer. Multisignature escrow transaction you say? Well, now we are back at square one with trusted third parties. I am from first world country with working banking system, Bitcoin is for countries with a lot of unbanked people you say? A system that needlessly burns electricity worth hundreds of millions of Dollars every year to provide anonymity no one asked for can hardly be the best solution. People that are still into Bitcoin just haven't yet really thought things through, hope to capitalize on greater fools, are into some less legal business or something along that line. Half a decade ago I really loved the idea of Bitcoin but since then enough time has passed to really understand the system and its implications. He's dead, Jim.
- adrianmacneil 11y ago
  I think you're missing the point that Bitcoin is an interesting payment network, despite the fact that as a consumer currency it's not particularly useful. Regardless of whether you or anyone wants an anonymous digital currency, or whether Bitcoin succeeds as being the dominant blockchain network in the long run, there's no denying that it's an interesting and useful technology. I see many commenters on HN who don't seem to understand the difference between these.
  - danbruc 11y ago
    It is an interesting idea, definitely. I can also easily imagine that a future cryptocurrency will see widespread adoption. But I can not see how Bitcoin or something build on top of Bitcoin or something very similar to Bitcoin could achieve this. What I don't understand in your comment, what is the relevant difference between Bitcoin as payment network and Bitcoin as currency that may make it work in one case but not the other. Interesting, yes, useful in its current incarnation, I don't see that.
vamur 11y ago
They only disabled it for Windows 10/Mobile, probably because no one is buying those using their store anyway.
LukeHoersten 11y ago
Turns out Microsoft is still accepting Bitcoin. The post was a mistake. http://www.cnbc.com/2016/03/14/microsoft-stops-accepting-bitcoin-on-windows-10.html http://www.cnbc.com/2016/03/14/microsoft-stops-accepting-bit...

101 points by mathieutd 11y ago

Does anyone have any idea why this is? Have companies moved on from considering Bitcoin something serious? I imagine their Bitcoin code was too expensive to maintain relative to the transaction volume it brought. Could this be a sign of things to come from other companies that support Bitcoin, and if others follow in Microsoft's footsteps, does this impact Bitcoin at all?

ethagknight 11y ago
Or could it be related to real/perceived risk in holding and trading bitcoins?
Kenji 11y ago
It's not just that. By accepting bitcoin, even if you change them to USD right away, you run a currency risk if BTC suddenly loses value. Also, when is a BTC transaction validated? Yeah, they have eventual consistency, but doublespending is actually possible. How long must the chain be after a transaction for it to be valid? These are nontrivial questions and tradeoffs that the store owner has to do about risks.
- jsprogrammer 11y ago
  Transactions are valid only when you trust you have the longest chain. If a longer chain comes along, you may abandon the shorter chain and believe the longer chain.
  - Kenji 11y ago
    Exactly. But when do you trust you have the longest chain? It could be that by some stroke of misfortune or malicious manipulation, a shorter chain suddenly catches up. Is a chain that is 10 links longer safe? As I said - eventual consistency. But when is eventually? This is a real issue for BTC transaction validation.
    - jcoffland 11y ago
      If the senaro you describe were remotely possible BitCoin would not exist. A chain more than a couple of blocks behind has almost no chance of catching up unless over 50% of the hashing power consolidated on the shorter chain. Since miners automatically abandon short chains and it is in their best interest to do so this is extremely unlikely.
      - the_mitsuhiko 11y ago
        What if mining pools would deliberately hold back mint blocks until they find more? That way they could invalidate transactions if they like.
        jsprogrammer 11y ago
        You can only hold a mint block until right before another block arrives. Once another block is known your mint block is garbage.
        the_mitsuhiko 11y ago
        > You can only hold a mint block until right before another block arrives. Once another block is known your mint block is garbage. What controls this?
        jsprogrammer 11y ago
        Each block must incorporate the hash from the previous block.
        the_mitsuhiko 11y ago
        So what stops you from mining ahead secretly?
        11y ago
elorant 11y ago
Could be related to recent development in Bitcoin as it reaches the 1MB limit and transactions take up to ten hours to be cleared.
valhalla 11y ago
If the Microsoft was liquidating bit coin the way planetjones describes, it was probably too inconvenient since the exchange rate (Bitcoin to $) would fluctuate so unpredictably and wildy (at times) there was no way to reliably exchange bitcoins for the exact amount customers were charged. If the exchange rate was too low, MSFT would lose money. If it was too high, they'd be breaking a number of very basic but important laws that are designed to protect consumers.
- valhalla 11y ago
  November 29th 2013 (A week after the Xbox One release) 1 Bitcoin == $1216.73. By December the same year the price "[had] crashed to $600, rebounded to $1,000, crashed again to the $500 range. Stabilized to the ~$650–$800 range." Here's a graph showing the rate from July '13 to June '15: https://en.wikipedia.org/wiki/History_of_Bitcoin#/media/File.. https://en.wikipedia.org/wiki/History_of_Bitcoin#/media/File....
- LukeHoersten 11y ago
  Microsoft did liquidate to USD right away using a company called BitPay. BitPay would take on the short term price risk and Microsoft would get exactly what they quoted in USD. Microsoft was not subject to BTCUSD price fluctuation in this scheme.
- bunderbunder 11y ago
  That said, just by eyeballing some graphs at Coinbase it looks to me like the exchange rate was a more volatile back when Microsoft started accepting Bitcoin than it is now. Which isn't to say that they couldn't reasonably decide that it's too volatile, but it does seem odd that they'd do so while the volatility's dropping rather than increasing. I'm inclined to guess that all the BTC in the news just led them to a more fundamental reconsideration of their bet that it is (or will become) a viable unit of exchange. There are a lot of take-aways you could get from recent events that might lead to that decision, but the most fundamental one is simply that it's become clear that a huge portion of the people controlling Bitcoin's future don't want it to become one.
LukeHoersten 11y ago
My guess is that they gave it a try and the purchase volumes never materially compared to credit card payments. Integration was done very poorly. You had to go to a special link "commerce.microsoft.com" and click on a small, un-styled link at the bottom of the page called "Redeem bitcoins". It was never integrated in to their main purchase flow in an easy way. It couldn't be found just by chance. You had to google to figure out how to fund with bitcoin. Edit: There are a handful of comments about price fluctuation. Microsoft liquidated to USD right away using a company called BitPay. BitPay would take on the short term price risk and Microsoft would get exactly what they quoted in USD. Microsoft was not subject to BTCUSD price fluctuation in this scheme.
the_mitsuhiko 11y ago
> Does anyone have any idea why this is? I wouldn't be surprised if they had a contract with a payment provider that was just too expensive for the little to no revenue that came in via bitcoin. Other than people that got bitcoin early there are not really any bitcoin users out there. Also pretty sure that handling refunds and customer support for failed payments must have been pretty involved.
eterm 11y ago
Almost certainly just low volume. Most merchants offering sale by bitcoin had little to no use. And it makes sense, most bitcoin owners bought to speculate. Spending bitcoin isn't that different to just selling the bitcoin and spending with actual money, so if they weren't going to sell their bitcoin, why spend their bitcoin? It's not like middlemen payment processors were avoided, most companies accepting bitcoin actually just accepted through a third party who would liquidate it back to money directly.
stevewilhelm 11y ago
> Does anyone have any idea why this is? I wonder about the accounting and tax ramifications of transactions done in Bitcoin.
- pmorici 11y ago
  There really aren't any outside of the normal. A company like Microsoft isn't holding the bitcoin they are immediately exchanging it so it is no different than taking USD since they don't make any gain or loss on the BTC.
  - dheera 11y ago
    In which case there's really no point to them using bitcoin. If they're converting it to USD immediately, they derive no benefit by using a decentralized currency.
    - pmorici 11y ago
      Sure they do. There is no charge back or fraud risk for the merchant with Bitcoin. It lets you service customers that might otherwise be too risky because they happen to fit a profile that correlates to high fraud risk.
aaachilless 11y ago
It probably has something to do with their support of Ethereum. https://azure.microsoft.com/en-us/blog/ethereum-blockchain-as-a-service-now-on-azure/ https://azure.microsoft.com/en-us/blog/ethereum-blockchain-a...
pash 11y ago
Microsoft seem to be more interested in Ethereum [0]. They introduced an Ethereum blockchain-as-a-service offering on Azure [1] last year, and they are working with R3 [2] and some other Ethereum-using players in the much-hyped blockchain space. They seem to have decided that Ethereum is a better solution than Bitcoin for a broad set of applications, and they're probably right. I do think Microsoft's move is indicative of growing disaffectation with Bitcoin. Bitcoin's community has been a cauldron of discontent for the better part of two years now. It's a mess, but it's not just about the blocksize. What most scares investors and technologists is that Bitcoin's development team appears to be beholden to the interests of a single company, and still worse, has disavowed making basic changes to the protocol. But basic changes are needed to enable many of the sorts of things that people dream of doing with blockchains—at least if they're going to be done with Bitcoin's blockchain. Meanwhile Ethereum and several other competitors are maturing into good alternatives. Ethereum is a much nicer platform for programmatic money. Dash [3], Monero [4], and new projects like Zcash [5] are in some ways technically superior to Bitcoin as currencies and payment networks. At the same time, many speculators have fled bitcoin, fearing a gridlocked community and technical stasis; they've put their money into other crypto-assets, driving up their valuations. The price of ether, Ethereum's underlying asset, has skyrocketed lately, to a valuation of over $1 billion. About half a dozen altcoins have risen enormously in value over the past several months, and higher valuations bring more interest. With more interest comes more use, and with more use comes more infrastructure; Bitcoin's first-mover advantage narrows. There was a time when I thought Bitcoin would be able to incorporate proven technical improvements from other systems, and by maintaining its technical competitiveness in that way also be able to maintain its network effect. I no longer think that. If Bitcoin can't purge its demons, other systems will out-compete it. 0. https://www.ethereum.org https://www.ethereum.org 1. https://azure.microsoft.com/en-us/blog/ethereum-blockchain-as-a-service-now-on-azure/ https://azure.microsoft.com/en-us/blog/ethereum-blockchain-a... 2. https://r3cev.com https://r3cev.com 3. https://www.dash.org https://www.dash.org 4. https://getmonero.org/home https://getmonero.org/home 5. https://z.cash https://z.cash
- deftnerd 11y ago
  Microsoft seems intent on supporting Blockchains as a service, but that doesn't mean that they're going to accept them internally on a business level. Microsoft's Blockchain platform on Azure currently supports Bitcoin, Bitshares, Ethereum, Emercoin, OpenLedger, Ripple, Factom, Eris, Coinprism, and more. Just because they now support Ethereum as a service doesn't mean that they're validating Ethereum and plan to incorporate deep within their business units. It also doesn't mean that they think it's better than Bitcoin. On a personal level, I'm quite excited by Ethereum and am more and more dejected by Bitcoin these days.
jkyle 11y ago
I don't think these companies ever considered Bitcoin as serious currency. More likely it's more about publicity and maintaining an image of being on the techno hipster edge.
dinkumthinkum 11y ago
But, and I mean this in a nice way, why would people consider Bitcoin to be something "serious" in terms of an actual currency? It is always on HN but it is like an interesting hobby for them, I guess. I also understand there are startups that have built "businesses" off of it, but it is sort of reminiscent of those businesses that sell the currencies from MMORPGs. I think Bitcoin is really meant for geeks to play with and argue and start massive flamewars over zero-knowledge proof engines and all this kind of stuff, rather than an actual real currency of the world. I guess there is an element of something like Goldbugs, but we were discussing being "serious," right?

planetjones 11y ago

My understanding was that companies accepting bitcoin like Microsoft just liquidated the BTC straight to USD anyhow. I don't blame them because of the fluctuation risk. However, I am not sure they were really helping bitcoin's long term viability - other than allowing the Bitcoin millionaires to spend their coins. I suspect not enough of these people who got rich by holding bitcoins were using their bitcoins to justify having it as a payment method in the Microsoft store.

colejohnson66 11y ago
Maybe it has to do with the obscene amount of time it takes for confirmations?
- everfree 11y ago
  They probably went through an external payment processor, so they weren't exposed to the Bitcoin network or its speed/risk at all.
- sidko 11y ago
  Why is the time obscene? It usually takes 45 days for confirmation if you pay via a credit card. Compare that to about 60 minutes for 6 confirmations on the Bitcoin blockchain, and it's orders of magnitude higher. You aren't actually comparing the few seconds it takes to swipe your credit card to 60 minute Bitcoin confirmation I hope. It's about 'reversibility' of a transaction - for a Bitcoin transaction to propagate takes about the same time as a credit card swipe to propagate. Edit: Wow why the downvotes? Seems like people here don't understand the first thing about how payments work in the real world. The funds are not 'confirmed' instantaneously. If someone walks into your store and pays you $1000 with a card, you can't say withdraw it in cash in 2 seconds. It takes about the same time for a 0-confirmation Bitcoin transaction as an 'unconfirmed' card transaction.
  - jdcarr 11y ago
    But there's a clear difference between being able to make a chargeback within 45 days and a payment system without reversible transactions. Authorising the card is instantaneous and the funds can be settled into your account within a couple of days.

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Crito 11y ago

I'm honestly still surprised they ever did. I wonder how much they spent implementing their ability to accept bitcoin. Probably more than they ever made in profit.

geographomics 11y ago

Unsurprising that they've ceased to accept Bitcoin. The only significant use cases thus far have been ransomware and buying recreational drugs. And early adopters cashing out of the pyramid scheme.

jcoffland 11y ago
And global remittances, store of wealth, international monetary system resistant to government and bank controls, to name a few other uses. It's amazing how many people are willing, even eager to dismiss crypto-currencies. The concept is so radical and revolutionary that it scares the shit out of a lot of people. It will take time for humans to catch up but if you think it's just a fad then you are deluding yourself.
- Certhas 11y ago
  Because the problem with the international finance system really is that the regulatory controls are to strict....
- moonbug 11y ago
  > The concept is so radical and revolutionary that it scares the shit out of a lot of people Oh please.
- jlarocco 11y ago
  "And global remittances, store of wealth, international monetary system resistant to government and bank controls, ..." BitCoin might be taken more seriously if their advocates explained why any of those need to be solved, and how BitCoin does it better than the existing solutions. Global remittance isn't something people need very often, and there are already solutions for it. BitCoin is not a very great store of wealth. Keeping a box of cash under your bed is more likely to retain its value than BitCoin. Storing wealth isn't even a very good idea, though, and if a person has enough money laying around they'd be better off investing it anyway. Finally, being "resistant to government and bank controls" isn't very convincing either, and I would hypothesize advertising it that way actually hurts take up by making it sound subversive. A drug kingpin would love a money system resistant to the government and the banking system, but what actual benefit does a normal person get from it? And is it even a true statement?

minimaxir 11y ago

Mozilla did A/B testing last year showing that simply offering a Bitcoin option reduced the amount of donations to the org overall by 7.5% on average. http://insidebitcoins.com/news/mozilla-study-shows-bitcoin-has-negative-impact-on-donations/34466 http://insidebitcoins.com/news/mozilla-study-shows-bitcoin-h... It is possible that just associating with Bitcoin makes the consumer more skeptical.

jordigh 11y ago
I don't think it's about bitcoins. Wikimedia has also noticed that donations can decrease if you offer too many donation methods. They've seen this without bitcoins. Maybe donors feel like with all of those methods available someone else is already donating? Or maybe they get bewildered by the excess of choice?
- pinum 11y ago
  Speculation: Would it help to offer two major methods (card, PayPal) prominently, and hide many more behind a small "other" link?
  - jordigh 11y ago
    This is almost exactly how Wikimedia accepts Bitcoin payments, behind an "other" link, with credit card and paypal being shown as the only two options if you click on "donate". In fact, it's kind of hard to find all of their payment options. The "other" button actually is called "problems with donating?"
- raverbashing 11y ago
  My suspicion is that people feel it's "trying too hard" to get donations
- NetStrikeForce 11y ago
  If it doesn't feel like a "one-click donation" I'm prone to skip it.
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qKTDxAy4KfcOjA9 11y ago

The elephant in the room here is that Bitcoin is dodgy. It's proponents claim that it has all sorts of uses, but the only thing people actually use it for is illegal activity. Since the Ross Ulbricht trial, it has become obvious that even using it for illegal activity is a bad idea, as it's easily traceable.

jordigh 11y ago
Sigh, I use bitcoins to get paid for online math tutoring, and I've spent them to buy headphones online and madeleines at coffee shops. I am not just a proponent; it just so happens that bitcoins are a convenient form of international internet money for me.
everfree 11y ago
Ugh. I use Bitcoin to buy and sell Team Fortress 2 items, because it doesn't have the counterparty risk that something like Paypal has (and it also has lower fees for the time being). Using Bitcoin also has the advantage that I can transact with it even in countries that Paypal doesn't support, and I don't have to worry about the Paypal account freezing bs that shows up in tech news from time to time. Also it's not true that using it for illegal activity is a bad idea - the evidence that Ross Ulbricht was ultimately found and convicted on was his internet activity not related to Bitcoin. If you do it right and use mixers properly, you can make Bitcoin untraceable. So actually, Bitcoin is usable for both legal and illegal purposes, which is a gold standard for any currency.
RaleyField 11y ago
> The elephant in the room here is that Bitcoin is dodgy. How people use is not its intrinsic property.
wiseleo 11y ago
It's ahead of its time. As lines blur between nations and international commerce becomes routine, there will be a need for global currency not subject to an individual nation's laws.

pbreit 11y ago

The move is to add bitcoin to your online store, generate a bit of buzz from the gimmick and then remove it since it makes no sense.

minimaxir 11y ago
Adding a Bitcoin payment option is not "free," since there is non-technical overhead opportunity cost/QA/support involved with adding Bitcoin payments, even if using a payment processing API eliminates the technical overhead. It is too much effort for "a bit of buzz."
- makomk 11y ago
  Probably the support overhead especially. The most popular Bitcoin payment provider (Coinbase) apparently fails transactions and requires manual intervention if they don't receive them within 15 minutes, and I'm not sure what they mean by receive but it happened to me despite sending payment within a couple of minutes of starting the transaction. Per the docs, they don't send any kind of API callback if this happens, just an automated e-mail telling the vendor what happened. Of course, that's an ongoing cost so it kind of makes sense to add Bitcoin for the publicity and then remove it later.
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troymc 11y ago
It seem you also get a bit of buzz when you remove it.
MichaelGG 11y ago
Accepting BTC via a company that converts it to USD immediately is great for high-risk operations. Like, suppose you sell VoIP online to anyone. You're going to have a ton of fraud. BTC allows you to work with legitimate companies and re-sellers without having to worry about credit checks. It's also handy for light hiding of your ID with respect to the store. If I purchase some degenerate online service from a company and pay using BTC, the chances of _them_ getting my actual name are far, far, less than if I use a credit card in my own name. (And buying prepaid cards is more of a hassle.)

runn1ng 11y ago

I would bet there are more people commenting here on this submission than people who ever used Bitcoin to buy anything in Microsoft Store.

bdcravens 11y ago
Or used Bitcoin to buy anything.

danbruc 11y ago

Bitcoin is dead and has been for years. And nobody broke it, it is just a solution without a problem. Sure, Mt. Gox, ASICs and the block size debate didn't exactly help Bitcoin, but nothing of that broke it. Yes, Bitcoin has some nice theoretical properties, but the masses don't need them. What good is an anonymous currency for buying stuff if the next thing I do is entering my shipping address? Whether the system is decentralized or centralized, the average user doesn't give a shit as long as it works. I don't have to trust a bank? I don't care, I never had any issues. And with Bitcoin I have to trust every single seller, no way to charge back in case they don't deliverer. Multisignature escrow transaction you say? Well, now we are back at square one with trusted third parties. I am from first world country with working banking system, Bitcoin is for countries with a lot of unbanked people you say? A system that needlessly burns electricity worth hundreds of millions of Dollars every year to provide anonymity no one asked for can hardly be the best solution. People that are still into Bitcoin just haven't yet really thought things through, hope to capitalize on greater fools, are into some less legal business or something along that line. Half a decade ago I really loved the idea of Bitcoin but since then enough time has passed to really understand the system and its implications. He's dead, Jim.

adrianmacneil 11y ago
I think you're missing the point that Bitcoin is an interesting payment network, despite the fact that as a consumer currency it's not particularly useful. Regardless of whether you or anyone wants an anonymous digital currency, or whether Bitcoin succeeds as being the dominant blockchain network in the long run, there's no denying that it's an interesting and useful technology. I see many commenters on HN who don't seem to understand the difference between these.
- danbruc 11y ago
  It is an interesting idea, definitely. I can also easily imagine that a future cryptocurrency will see widespread adoption. But I can not see how Bitcoin or something build on top of Bitcoin or something very similar to Bitcoin could achieve this. What I don't understand in your comment, what is the relevant difference between Bitcoin as payment network and Bitcoin as currency that may make it work in one case but not the other. Interesting, yes, useful in its current incarnation, I don't see that.

vamur 11y ago

They only disabled it for Windows 10/Mobile, probably because no one is buying those using their store anyway.

LukeHoersten 11y ago

Turns out Microsoft is still accepting Bitcoin. The post was a mistake. http://www.cnbc.com/2016/03/14/microsoft-stops-accepting-bitcoin-on-windows-10.html http://www.cnbc.com/2016/03/14/microsoft-stops-accepting-bit...