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From a practical standpoint, Bitcoin has other problems for using it in a real business -- mainly the fact that taxes are only payable in the coin of the realm.

by Duff 16y ago

From a practical standpoint, Bitcoin has other problems for using it in a real business -- mainly the fact that taxes are only payable in the coin of the realm. If you are a real, legal business, do you want your entire personal and business future contingent on the ability to exchange bitcoin with dollars?

weavejester 16y ago
You don't have to put all your eggs in one basket. You could accept payment in dollars and bitcoins, and exchange the bitcoins for dollars the day you receive it. If the bitcoin market suddenly crashes, you'd only lose the amount you hadn't managed to exchange for dollars.
- Duff 16y ago
  If you do that, what's the advantage of bitcoin?
  - noahc 16y ago
    Currency Diversification. The point being that at the end of each day/week/month you can cash it out for dollars/euro/yen. That's the idea anyway. I'm not sure how practical it is!
  - weavejester 16y ago
    You can send bitcoins directly to a person's account without going through an intermediary, such as Paypal or a bank. This means that it would potentially be cheaper, but more importantly it would be easier to automate, and easier to start up interesting financial web apps.
    - pyre 16y ago
      Exactly. The vendor wouldn't be paying the tithe to the credit card processor.
      - Duff 16y ago
        You're just shifting from the credit card processor to the dollar/euro/bitcoin exchange person.
        weavejester 16y ago
        I'd imagine there's more scope for competition. Setting up a new credit card takes a lot of money, whilst exchanging dollars for bitcoins is essentially free (so long as you have enough bitcoins). That said, I don't think this is the most interesting part of bitcoins.
      - gaius 16y ago
        I can already do free transfers to anyone's bank account: it's called BACS, every UK bank account supports sending and receiving BACS transfers, the vast majority through a web interface. Takes 3 days, but who cares?
        burgerbrain 16y ago
        "Takes 3 days, but who cares?" Who wouldn't care? At 3 days, you might as well just mail around cash.
        gaius 16y ago
        You can do it faster if you're willing to pay a fee, whether that's to Paypal, or to do a CHAPS transfer. If the point is avoiding paying to move cash around, it's already perfectly do-able.
- quanticle 16y ago
  And how exactly would you exchange bitcoin for dollars? Presumably, you'd have to go through a bank, or PayPal, or a regulated brokerage house of some kind. To keep bitcoin from taking off, all the US government would have to do is pass a law or put pressure on the financial industry to not allow that exchange.
  - weavejester 16y ago
    That's a valid strategy, and one the US government may even employ. However, other countries would have to agree to similar restrictions, otherwise you could trade dollars for euros, then euros for bitcoins. It also wouldn't prevent over-the-counter exchanges between individuals. The US government would also run into opposition from groups like the EFF, and I think it would be difficult to word the law to ban bitcoins specifically, and not other similar mathematical activities (like issuing SSL certificates).
    - fauigerzigerk 16y ago
      That's completely unrealistic. There is very tight cooperation between the major currency blocks when it comes to the crackdown on anonymous payments and on everything anonymous for that matter.
      - weavejester 16y ago
        No there isn't. Anonymous paper money is still used in every country in the world, anonymising P2P networks like Tor and I2P have not been outlawed, you can buy pre-paid VISAs and pre-paid phones legally and anonymously and many people send routinely anonymous donations to political organisations.
        quanticle 16y ago
        you can buy pre-paid VISAs and pre-paid phones legally and anonymously I thought legislation had been passed stating that purveyors of pre-paid debit cards and cell phones had to ask for ID and keep records so that, if the cards or phones were used in a crime, the purchaser could be traced. I do know that legislation to that effect was introduced. I'm not sure if it was ratified, but even if anonymous cards and phones are legal now, I have no confidence that they will continue to be legal for the foreseeable future.
pyrhho 16y ago
From a practical standpoint, the Dollar has other problems for using it in a real business -- mainly the fact that it is controlled by a centralized, and potentially incompetent, bureaucracy. If you are a real, legal business, do you want your entire personal and business future contingent on the ability to exchange dollars with goods and services?

by Duff 16y ago

weavejester 16y ago

You don't have to put all your eggs in one basket. You could accept payment in dollars and bitcoins, and exchange the bitcoins for dollars the day you receive it. If the bitcoin market suddenly crashes, you'd only lose the amount you hadn't managed to exchange for dollars.

Duff 16y ago
If you do that, what's the advantage of bitcoin?
- noahc 16y ago
  Currency Diversification. The point being that at the end of each day/week/month you can cash it out for dollars/euro/yen. That's the idea anyway. I'm not sure how practical it is!
- weavejester 16y ago
  You can send bitcoins directly to a person's account without going through an intermediary, such as Paypal or a bank. This means that it would potentially be cheaper, but more importantly it would be easier to automate, and easier to start up interesting financial web apps.
  - pyre 16y ago
    Exactly. The vendor wouldn't be paying the tithe to the credit card processor.
    - Duff 16y ago
      You're just shifting from the credit card processor to the dollar/euro/bitcoin exchange person.
      - weavejester 16y ago
        I'd imagine there's more scope for competition. Setting up a new credit card takes a lot of money, whilst exchanging dollars for bitcoins is essentially free (so long as you have enough bitcoins). That said, I don't think this is the most interesting part of bitcoins.
    - gaius 16y ago
      I can already do free transfers to anyone's bank account: it's called BACS, every UK bank account supports sending and receiving BACS transfers, the vast majority through a web interface. Takes 3 days, but who cares?
      - burgerbrain 16y ago
        "Takes 3 days, but who cares?" Who wouldn't care? At 3 days, you might as well just mail around cash.
        gaius 16y ago
        You can do it faster if you're willing to pay a fee, whether that's to Paypal, or to do a CHAPS transfer. If the point is avoiding paying to move cash around, it's already perfectly do-able.
quanticle 16y ago
And how exactly would you exchange bitcoin for dollars? Presumably, you'd have to go through a bank, or PayPal, or a regulated brokerage house of some kind. To keep bitcoin from taking off, all the US government would have to do is pass a law or put pressure on the financial industry to not allow that exchange.
- weavejester 16y ago
  That's a valid strategy, and one the US government may even employ. However, other countries would have to agree to similar restrictions, otherwise you could trade dollars for euros, then euros for bitcoins. It also wouldn't prevent over-the-counter exchanges between individuals. The US government would also run into opposition from groups like the EFF, and I think it would be difficult to word the law to ban bitcoins specifically, and not other similar mathematical activities (like issuing SSL certificates).
  - fauigerzigerk 16y ago
    That's completely unrealistic. There is very tight cooperation between the major currency blocks when it comes to the crackdown on anonymous payments and on everything anonymous for that matter.
    - weavejester 16y ago
      No there isn't. Anonymous paper money is still used in every country in the world, anonymising P2P networks like Tor and I2P have not been outlawed, you can buy pre-paid VISAs and pre-paid phones legally and anonymously and many people send routinely anonymous donations to political organisations.
      - quanticle 16y ago
        you can buy pre-paid VISAs and pre-paid phones legally and anonymously I thought legislation had been passed stating that purveyors of pre-paid debit cards and cell phones had to ask for ID and keep records so that, if the cards or phones were used in a crime, the purchaser could be traced. I do know that legislation to that effect was introduced. I'm not sure if it was ratified, but even if anonymous cards and phones are legal now, I have no confidence that they will continue to be legal for the foreseeable future.

pyrhho 16y ago

From a practical standpoint, the Dollar has other problems for using it in a real business -- mainly the fact that it is controlled by a centralized, and potentially incompetent, bureaucracy. If you are a real, legal business, do you want your entire personal and business future contingent on the ability to exchange dollars with goods and services?