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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 fluctuati

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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- jordigh 11y ago
  Confirmations are not required for casual purchases. The amount of luck and effort required to double-spend an unconfirmed transaction greatly exceeds the value of casual purchases. Bitcoin confirmations are more akin to the months during which you're allowed to contest a credit card purchase, except instead of months, it's between a few minutes to an hour. Sitting there waiting for confirmation for a bitcoin purchase for a videogame is like waiting for the credit card company to reassure you that the transaction is now irreversible.
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pbreit 11y ago
If you liquidate instantly, there's not fluctuation risk.
- schmichael 11y ago
  Liquidation usually incurs a fee. Once you add up the buyers fee to convert fiat-> Bitcoin, the Bitcoin transaction fee, and the seller's conversion from Bitcoin->fiat, Bitcoin's marginal cost benefit over credit cards is slim. As miners become less subsidized by block rewards and must rely more on fees for covering costs (and/or full blocks cause a spike in Bitcoin fees), it seems like the cost-per-transaction may swing in favor of fiat payment schemes.
jkyle 11y ago
> 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. That's the problem with fixed, deflationary currencies....no one wants to spend them.

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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jordigh 11y ago
Confirmations are not required for casual purchases. The amount of luck and effort required to double-spend an unconfirmed transaction greatly exceeds the value of casual purchases. Bitcoin confirmations are more akin to the months during which you're allowed to contest a credit card purchase, except instead of months, it's between a few minutes to an hour. Sitting there waiting for confirmation for a bitcoin purchase for a videogame is like waiting for the credit card company to reassure you that the transaction is now irreversible.
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pbreit 11y ago

If you liquidate instantly, there's not fluctuation risk.

schmichael 11y ago
Liquidation usually incurs a fee. Once you add up the buyers fee to convert fiat-> Bitcoin, the Bitcoin transaction fee, and the seller's conversion from Bitcoin->fiat, Bitcoin's marginal cost benefit over credit cards is slim. As miners become less subsidized by block rewards and must rely more on fees for covering costs (and/or full blocks cause a spike in Bitcoin fees), it seems like the cost-per-transaction may swing in favor of fiat payment schemes.

jkyle 11y ago

> 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. That's the problem with fixed, deflationary currencies....no one wants to spend them.