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Those credit card fees are really high. Ie in the US they're closer to 1.5% for any merchant doing decent volumes. Many of the fees associated with non Bitcoin

Those credit card fees are really high. Ie in the US they're closer to 1.5% for any merchant doing decent volumes. Many of the fees associated with non Bitcoin transactions reflect the cost of regulation. So until Bitcoin is regulated these comparisons are misleading. (and it will need to be subjected to some types of regulations if it wants broad adoption vs niche adoption) Lastly, LevelUp is trying to do the "very cheap to no fee processing" and making it up with mining data and providing BI services for a fee back to their merchants. Not sure if they'll succeed or not.

sporkmonger 13y ago
I used credit card transactions rates published by Stripe for the table. Square's pricing is pretty similar, though they don't have a '+ X cents' for non-manually entered transactions, which does make them a very good choice for buying a $3 coffee. Certainly Walmart is going to get better volume rates than anybody using Square or Stripe, but most people are not large retailers. Bitcoin is actually regulated already, however the costs of Bitcoin regulation cannot be reflected in the protocol's transaction fee. An additional fee could be assessed by the service provider, but so far these fees typically happen right now at currency exchange points, rather than as a bonus 'sales tax'. BitPay has chosen to charge a flat rate monthly payment for their non-free plan while Coinbase charges 1% to cash out to USD. Also I'm well aware of LevelUp. Point was not that other payment mediums cannot do the same but that Bitcoin can potentially provide valuable insight for a much larger set of transactions once you're able to make sense of a big enough chunk of the blockchain.
- saurik 13y ago
  Stripe's pricing is ludicrously expensive. And Square is trying to be more than just a payment processor. These companies are competing for markets that seriously care more about "pretty website" than "efficient business". I mean, even PayPal had much better rates than Stripe: that $1 charge would have a $0.10 fee if done via PayPal (even using PayPal's direct credit card billing solutions). For larger price points, Stripe finally added some volume discounts, but they are nowhere near as good as their competitors (like, they require so much volume as to be unattainable for most merchants). Using Stripe as a comparison for this kind of purpose is thereby just silly...
  - sporkmonger 13y ago
    Fair enough. That said, I know of small businesses that are charged vastly larger %s going through a merchant account, etc (like nearly double what Square/Stripe charge) so I don't think the rate is entirely unfair. I'd rather aim for a median rate than 'lowest possible' for a table like this, but I haven't seen anybody post average rates that are anything but estimates and I am reluctant to publish a number in a table like that that I'd just pulled out of thin air. I believe median card-not-present rate is ~2.5%, but that's a thin air number.
    - saurik 13y ago
      The issue at hand is that you've pulled a ludicrous flat overhead fee for the low-end numbers, leading to a 33% charge... even normal un-negotiated merchant accounts are usually not that expensive (the percentage gets higher, but the fixed fees are normally lower). PayPal (which as far as I know anyone could get) is 5%+$0.05, which works out to 10% on the $1 charge.

sporkmonger 13y ago

I used credit card transactions rates published by Stripe for the table. Square's pricing is pretty similar, though they don't have a '+ X cents' for non-manually entered transactions, which does make them a very good choice for buying a $3 coffee. Certainly Walmart is going to get better volume rates than anybody using Square or Stripe, but most people are not large retailers. Bitcoin is actually regulated already, however the costs of Bitcoin regulation cannot be reflected in the protocol's transaction fee. An additional fee could be assessed by the service provider, but so far these fees typically happen right now at currency exchange points, rather than as a bonus 'sales tax'. BitPay has chosen to charge a flat rate monthly payment for their non-free plan while Coinbase charges 1% to cash out to USD. Also I'm well aware of LevelUp. Point was not that other payment mediums cannot do the same but that Bitcoin can potentially provide valuable insight for a much larger set of transactions once you're able to make sense of a big enough chunk of the blockchain.

saurik 13y ago
Stripe's pricing is ludicrously expensive. And Square is trying to be more than just a payment processor. These companies are competing for markets that seriously care more about "pretty website" than "efficient business". I mean, even PayPal had much better rates than Stripe: that $1 charge would have a $0.10 fee if done via PayPal (even using PayPal's direct credit card billing solutions). For larger price points, Stripe finally added some volume discounts, but they are nowhere near as good as their competitors (like, they require so much volume as to be unattainable for most merchants). Using Stripe as a comparison for this kind of purpose is thereby just silly...
- sporkmonger 13y ago
  Fair enough. That said, I know of small businesses that are charged vastly larger %s going through a merchant account, etc (like nearly double what Square/Stripe charge) so I don't think the rate is entirely unfair. I'd rather aim for a median rate than 'lowest possible' for a table like this, but I haven't seen anybody post average rates that are anything but estimates and I am reluctant to publish a number in a table like that that I'd just pulled out of thin air. I believe median card-not-present rate is ~2.5%, but that's a thin air number.
  - saurik 13y ago
    The issue at hand is that you've pulled a ludicrous flat overhead fee for the low-end numbers, leading to a 33% charge... even normal un-negotiated merchant accounts are usually not that expensive (the percentage gets higher, but the fixed fees are normally lower). PayPal (which as far as I know anyone could get) is 5%+$0.05, which works out to 10% on the $1 charge.