14 ms·

Now Accepting Bitcoin on Dell.com

400 points by mrb 12y ago

mrb 12y ago
Surely many will ask "Why would I pay Dell in bitcoins?". Well Dell wants to promote the currency so much they will be giving a discount: "we’ll be offering a special Alienware promotion wherein customers can save 10% off a new Alienware system purchase (up to $150 limit) when checking out with bitcoin"
- crb 12y ago
  A partnership with Coinbase is seen as low enough risk (they're backed by A16Z!), that conventional merchants are prepared to use them as a payment processor; first, probably, in exchange for publicity, and later, because they will be at a competitive disadvantage if they don't.
- foobarqux 12y ago
  But most people have to pay extra to acquire Bitcoins in the first place. And 10% is a promotion not a persistent discount. Why would I pay Dell in bitcoins in the long term given that Coinbase doesn't have any obvious cost advantage over other payment processors?
  - baby 12y ago
    People who already have bitcoins can now spend them to get an Alienware. I know I would if I didn't lose mine.
    - gambiting 12y ago
      If it means that I can get $150 off a new Alienware machine I would go and create a wallet right now to buy some bitcoins.
  - livingparadox 12y ago
    If you don't use bitcoin, there's absolutely no reason. Same reason for paypal et al. There are a group of people who prefer to use bitcoin as their payment method, and this is for them.
  - mrb 12y ago
    You say "why would I spend bitcoins if I don't have any?" That's the problem of bootstrapping an economy. But I would like to point out that the history of Bitcoin demonstrates it is not such a big problem. Indeed more and more merchants are accepting it, more and more users are setting up wallets, more and more people are giving bitcoins to friends and family, etc. So given this adoption, at some point you will probably receive some bitcoins. Perhaps a friend will give you bitcoins as a birthday gift, or a coworker will insist to pay you back his sandwich in Bitcoin. Then you will say to yourself "hey, why not spend it on that ergonomic Dell keyboard"? And you will have played a role in bootstrapping the Bitcoin economy.
    - foobarqux 12y ago
      I don't think it is plausible that a significant number of people will receive a material portion of their income from Bitcoin. Your examples of ways in which I can receive BTC are trivial in amount and frequency.
  - baddox 12y ago
    > But most people have to pay extra to acquire Bitcoins in the first place. What do you mean by "pay extra"? The functional exchange rate of that currency to bitcoins is the total cost of exchanging fiat currency for bitcoins.
    - foobarqux 12y ago
      Trading costs are an expense and you pay Coinbase more than the market spread (they need to make money). If you use a credit card to buy BTC you pay those fees directly or indirectly.
- 67726e 12y ago
  > Well Dell wants to promote the currency Maybe. But that's probably just wishful thinking. Someone in marketing probably came up with this as a way to get some free publicity from all the raving bitcoin lunatics and get some sales. Offering 10% off of their Alienware systems, which are pretty well know as overpriced crap, is probably a fraction of their markup.
  - bduerst 12y ago
    Right. As with Overstock, this is marketing ploy to a target demographic.
    - Alupis 12y ago
      My company started accepting bitcoin a few months back. We use BitPay.com to offload risk (they instantly convert a BTC payment into your preferred currency and cash you out at the going rate). We haven't made any sales with BTC yet... (as my VP reminds me weekly ;-), but none-the-less, the company views it as a great alternative to what normally would constitute a "high risk" shipment (usually to countries were high credit card fraud rates or other scams originate from... if we get our money now, and there is no risk of chargeback, etc, then we will ship the order). So, it's not really a "marketing ploy" as you put it, but rather a good vehicle to accept orders the company may have normally rejected due to too much risk.
      - doctorfoo 12y ago
        So, uh, what's the company? I got me some Bitcoins here. (Partially serious; chances are you don't sell what I need, but if you did, I'd rather support a Bitcoin accepting company.)
        Alupis 12y ago
        Doubtful you would be interested in our products, although you never know! -- we're in the jewelry and crafting business. http://www.jewelrysupply.com/ http://www.jewelrysupply.com/ http://www.jewelrysupply.com/ordering_info.html http://www.jewelrysupply.com/ordering_info.html
- battani 12y ago
  > Well Dell wants to promote the currency Dell wants to promote Dell. And the Alienware promotion? Alienware is used primarily for video gaming. There's quite an overlap between the demographics that play video games and own bitcoin ("geeks"). This is Marketing 101.
- Alupis 12y ago
  > Well Dell wants to promote the currency so much they will be giving a discount What could be going on here is, Dell is speculating on BTC. So a 10% discount today in exchange for products they still make profit on, will result in potentially multitude of additional profit later. (The discount encourages people to give Dell their BTC, so Dell can sit on them and speculate... it's what a lot of the BTC payment processors are doing presumably).
  - bequanna 12y ago
    Dell sells computers and peripherals. They aren't really in the business of alternative currency speculation. I doubt Dell management (at any level) would green-light gambling with company revenue. > it's what a lot of the BTC payment processors are doing presumably Maybe some, but certainly not most.
Zikes 12y ago
Whatever happened to that crisis where a single party got control of 51% of total network mining power giving them essentially 100% control over the blockchain? [1] [1] https://news.ycombinator.com/item?id=7890215 https://news.ycombinator.com/item?id=7890215
- sp332 12y ago
  They've voluntarily decided to limit themselves to 40%. https://arstechnica.com/business/2014/07/bitcoin-pool-ghash-io-commits-to-40-hashrate-limit-after-its-51-breach/ https://arstechnica.com/business/2014/07/bitcoin-pool-ghash-...
  - jdong 12y ago
    And that 40% is still enough for lots of attacks.
    - michaeltoth 12y ago
      Not really. For an attack to be possible, the attacker needs to generate an alternate blockchain faster than the honest blockchain. This problem can be thought of as a binomial distribution where the "success" is the honest blockchain mining a block and extending its lead by a block and the "failure" is the attacking chain being extended by one, reducing the gap by 1 block. p = probability of honest blockchain extension by 1 block q = 1 - p = probability the attacker extends by 1 block If p <= q, the probability of the attacker catching up at some point in time is 1. This is what makes a 51% attack possible. If p > q, the probability of the attacker catching up is (q/p)^z where z is the number of blocks behind at the beginning of the attack. There is a reasonable possibility for small values of z (small number of blocks behind), that 40% control would allow for the creation of an alternate blockchain longer than the honest chain, but this is mitigated by the fact that transactions require confirmations, which extends the number of blocks and makes the likelihood of an attack very unlikely.
      - sp332 12y ago
        51% attack is not the only kind of attack. A "selfish mining" attack can break the system too. http://hackingdistributed.com/2013/11/04/bitcoin-is-broken/ http://hackingdistributed.com/2013/11/04/bitcoin-is-broken/ Here's the paper http://arxiv.org/abs/1311.0243 http://arxiv.org/abs/1311.0243
tabrischen 12y ago
Earlier this week, Shopify integrated with Coinbase to provide 100,000+ online stores with bitcoin checkout. It's really exciting to see bitcoin adoption rising among merchants of different sizes.
- aroch 12y ago
  I feel like merchant adoption is being done for the sake of "looking cool" not because they really care or their users really want it. Actual adoption of bitcoin by consumers has remained relatively flat
  - jcliff 12y ago
    flat based on what?
    - dictum 12y ago
      Not sure if that's what the parent reply means, but while there's no baseline to compare growth in consumer usage of bitcoin, you can compare it to the growth in business acceptance of bitcoin.
    - aroch 12y ago
      The number of bitcoin transactions/day hasn't really changed, at all, despite all these vendors adopting it. http://blockchain.info/charts/n-transactions http://blockchain.info/charts/n-transactions
      - mrb 12y ago
        You fail at reading a graph (in your defense, the data is noisy). But smooth it by looking at the quarterly averages and it is clear there was a +40% growth from 45k to 65k transaction/day over the last year: http://i.imgur.com/XJs4V74.png http://i.imgur.com/XJs4V74.png (or see www.quandl.com/BCHAIN/NTRAN-Bitcoin-Number-of-Transactions and select "quarterly".)
        12y ago
yefim 12y ago
A huge win for Coinbase. Congratulations Brian and the rest of the team!
parfe 12y ago
Acceptance of bitcoin continues to increase, but has a store seen sustained usage? I recall a chart from a few weeks ago after newegg(?) began accepting bitcoins an initial glut of bitcoin transactions quickly dwindled to background noise. It seems once the novelty wears away people find it easier to just pay directly in USD.
- chc 12y ago
  Alternate theory: Bitcoin owners are disproportionately likely to be speculators who have no interest in ever spending Bitcoins except maybe once as a novelty.
  - rockyleal 12y ago
    I have owned for a long time. This is not a good time to spend, that is all. The price seems to be artificially depressed right now, especially considering all the big companies starting to accept it. In a few months I will use them way more.
- johmas 12y ago
  We added a btc option at Tuft & Needle last November and up until about Feb was about 5% of our sales. btc purchases have been steadily dropping and are now around .01%
  - aianus 12y ago
    Do you offer a discount for people paying in BTC? If not, why not?
- doctorfoo 12y ago
  I pay my monthly VPN subscription with BTC, and will continue to do so. That's not a store and certainly a niche, mind.
slg 12y ago
What I find interesting about all these new merchants accepting Bitcoin is what happens to the Bitcoin they receive. It is a safe bet that all of these Bitcoin are converted to USD immediately as part of the payment processing by someone like Coinbase. The question is, can Coinbase sell these coins as quickly as they receive them? If not, what kind of exposure do they have to the violatility of the price of Bitcoin? Is that exposure high enough that these companies could be brought down by a drop in Bitcoin pricing and would that lead to a collapse of the Bitcoin economy (i.e. are any of these too big to fail)?
- rockyleal 12y ago
  Impressive. You managed to turn the most positive news for Bitcoin into a post about the "collapse of the Bitcoin economy", through a very flimsily constrcted series of assumptions. There should be like a new version of Godwin's law wherein all positive Bitcoin news will lead to its collapse in three steps.
  - krzrak 12y ago
    But slg raised interesting questions. That was the first thing I thought about as well after reading the article: will Dell (and other companies) keep the bitcoins? Rather not, the Coinbase will convert them to dollars immediately.
  - tlrobinson 12y ago
    Likewise, any negative news about Bitcoin will be turned into "actually good news".
  - larrys 12y ago
    Why don't you try and counter or answer what he is saying instead of attacking him for saying it.
    - rockyleal 12y ago
      Because it smells like a manipulative post. The goal (it seems) is not to discuss the topic, but to deformm the opinion of the readers and the general mood of the thread. If you want an answer, it is easy: companies like coinbase or bitpay know very well what they are doing, and participate in the market in ways that minimise the exposure risk. OP does not deserve to be top post in a site that is supposed to have quality debate like HN.
wallzz 12y ago
Is it just Dell.com or all the Dell's ?( dell.fr , dell.de ...)
vectorpush 12y ago
Notice how all these big "wins" for bitcoin come in the form of services facilitated by a centralized 3rd party. Coinbase, Bitpay, et al are becoming the de facto gatekeepers of bitcoin in business, it's not hard to imagine a future where these companies are the only practical option for real people interacting with the bitcoin economy. We're building a centralized infrastructure around the supposed decentralized currency of the future and these companies have extremely cumbersome KYC procedures; paypal never required me to scan a passport, take a selfie or submit to social graph analysis in order to use their services. edit: As some have pointed out, KYC is for buying bitcoin, not for making purchases with bitcoin, this is a fair point, but I think it's still noteworthy to recognize that most people will endure that KYC process to acquire bitcoins since the alternative is something like localbitcoins (scam prone and considerable effort for a newbie). Additionally, it's still true that for most people, the practical utility of bitcoin is a function of the services that these 3rd party companies are willing/able to provide, if some of these big players went bankrupt, suffered from long term DDOS, encounter legal problems or have their coins stolen by hackers, suddenly your average consumer has lost practical use of their bitcoins.
- pavs 12y ago
  I don't know about you but paypal asked me to send a picture of my id along with a recent picture of me. They froze my account until I did so.
- ihsw 12y ago
  The difference is that the BTC transaction system can operate independently of the incumbent transaction system.
- evv 12y ago
  It is only natural for centralized parties to emerge. I'd rather have centralized players with a decentralized back-end versus the banking system we rely on today. With paypal there is no consumer oversight, but because of the block chain, anybody can verify that coinbase acts as it should. And I'm not going to fault them for using every user authentication mechanism under the sun- it is the responsible way to operate.
lucb1e 12y ago
What's interesting is that they are limiting this borderless currency to US-only. But it doesn't take much to start accepting from other countries after they get through the legal complications, it probably won't take too long :)
- MichaelGG 12y ago
  Dell isn't actually doing anything with the Bitcoin, they're getting USD payments via Coinbase. And Coinbase appears to be US only and maybe US bank only? Their site says: "Right now the only supported payout option is USD to a bank account. However, options for other countries are planned." Which is a bit ambiguous but I think it may be only US bank accounts (or accounts accessible within the US system)?
  - lucb1e 12y ago
    Very good point, thanks for the reply. One remark though: > "Dell isn't actually doing anything with Bitcoin" Perhaps not directly, but they don't go and accept any odd currency that comes along. It shows that Bitcoin is an interesting option to look at.
    - sanswork 12y ago
      Dell will accept any currency at all as long as Visa, Mastercard, Amex, etc will convert it to USD first.
      - lucb1e 12y ago
        Tell that to e-gold
  - aianus 12y ago
    The Dell merchant account on Coinbase has to be US-based but there's no reason they can't accept BTC from anyone world-wide.
Keyframe 12y ago
I have a question. If business sells something directly for bitcoin (not via 3rd party which accepts bitcoin and proceeds cash), how do they do VAT?
- gcp 12y ago
  What does bitcoin have to do with this question? Hint: nothing.
  - Keyframe 12y ago
    It has to do everything with it. If company sells something directly to a customer and is under VAT obligation and it takes bitcoins in exchange for goods.. how is VAT then distributed to tax collecting entity? I guess that's why 3rd party bitcoin processors are popular because business is getting cash, not bitcoins. I presume if they were collecting bitcoins directly, then it would be no different than dealing with non-convertible foreign currency, which is not a legal tender, and it would be impossible to deal with.
    - gcp 12y ago
      how is VAT then distributed to tax collecting entity? The same way it is with any other payment system, by having the vendor pay the tax collecting authority. Again, the payment system is totally irrelevant here. Seeing your clarification in the other response: As for the issue of the exchange rate and convertibility on taxes, I can only speak from the local law here, but the defining section of VAT regulations says that if the sale "contract" specifies the exchange rate between the used currency and EUR, that is the rate to be used for the calculation of VAT due. If you wouldn't mention the current Bitcoin/EUR rate on the invoice, you move into undefined territory.
- deleted 12y ago
  [deleted]
- wmf 12y ago
  If a business sells something directly for USD, how do they do VAT? (Assuming that the company is not in the US since the US doesn't have VAT.)
wsxcde 12y ago
We know that number of blockchain transactions has been more or less constant for a while and in the range of several tens of thousands per day. This means either merchants aren't seeing too many bitcoin sales OR a lot of these sales are happening offchain through coinbase/bitpay. In the latter scenario, coinbase just looks like a giant transaction fee with nothing changing except an entry in their database. Are they generating enough value to justify these fees? Note coinbase/bitpay makes money when (1) they sell you (the customer) bitcoin (2) the buy/sell spread when you buy btc (3) merchant fees and (4) buy/sell spread again when the purchase occurs. A big selling point for bitcoin was that you'd avoid credit card processing fees. Has someone done the math on whether this is turning out to actually be cheaper than credit cards after all fees are considered? And even if they turn out to be marginally cheaper, is it justified from the consumer's point of view given you don't even get the consumer protections that you get for free with a credit card?
- mrb 12y ago
  "number of blockchain transactions has been more or less constant" No: https://blockchain.info/charts/n-transactions?timespan=all&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address= https://blockchain.info/charts/n-transactions?timespan=all&s...
  - vijayboyapati 12y ago
    Also the number of transactions per se is not the best measure of bitcoin's importance; it is the total purchasing power being transferred that should be considered. Bitcoin is a medium of savings that allows people to transfer value easily, from any point on the globe to any other point with minimal fees. The total purchasing power being transferred has growth tremendously because BOTH the number of transactions has grown AND the purchasing power of bitcoin has increased manyfold in the last few years. This, of course, does not even factor in all the transactions that happen off blockchain.
    - wsxcde 12y ago
      I think looking at transactions is a reasonable metric. In fact, even this metric may be overstating things. Tim Swanson has analyzed transactions excluding popular addresses (apparently this excludes things like SatoshiDice) to identify transactions that are positive-sum in an economic sense and then the numbers look even lower. [1] Another factor to consider is that if you count purchasing power transferred (which I assume means dollar value times transactions) you'll end up giving a lot of weight to events like when coinbase/mtgox moved their coins from one wallet to another. [1] http://www.ofnumbers.com/2014/06/23/separating-activity-from-growth-on-bitcoins-network/ http://www.ofnumbers.com/2014/06/23/separating-activity-from...
martinSlovakia 12y ago
Hi all, please for anybody's sake, can you explain me why the world is accepting something that we know is unsecured properly? Sometimes money just disappear etc..
- josu 12y ago
  Is there any properly secured money? Each type of money has its flaws and its advantages. For one, bitcoin is traceable to a certain degree, whreas a paper bill is not. >Sometimes money just disappear Are you talking about fiat money or bitcoin?
  - martinSlovakia 12y ago
    bitcoin
    - josu 12y ago
      Sorry, it was rethorical. I wanted to point out that fiat money disappears all the time. I lose money all the time; it falls out of my pocket, I forget where I put it... However I have never lost any amount of bitcoin.
- embolalia 12y ago
  What do you mean by "just disappear"? People lose it, but because they lose the keys or passwords. It's not like the protocol causes it to poof away out of nowhere. It's entirely user error, and not terribly hard errors to avoid at that.
  - martinSlovakia 12y ago
    I meant bitcoins stolen by hackers - in digital world where is practically no anonymity.. ..and what about that idea, where you buy HW with graphics card and you can earn bitcoins? It sounds so simple and unbelievable imho. That's why I am curious.
- Crito 12y ago
the_rosentotter 12y ago
Anyone else noticing this story getting furiously downmodded? 250 points within two hours and buried under older, lesser stories. The bitcoin butthurt is strong here on Hacker News.
- vectorpush 12y ago
  HN stories cannot be downvoted.
  - the_rosentotter 12y ago
    "Modded", not voted.
malloreon 12y ago
Title should be "Dell now accepts USD and doesn't care where it comes from!"
chesterbr 12y ago
Can I buy a server and only pay after I mine its price in bitcoins with it? :-) (pretty please with sugar, don't take this joke seriously)

400 points by mrb 12y ago

mrb 12y ago

Surely many will ask "Why would I pay Dell in bitcoins?". Well Dell wants to promote the currency so much they will be giving a discount: "we’ll be offering a special Alienware promotion wherein customers can save 10% off a new Alienware system purchase (up to $150 limit) when checking out with bitcoin"

crb 12y ago
A partnership with Coinbase is seen as low enough risk (they're backed by A16Z!), that conventional merchants are prepared to use them as a payment processor; first, probably, in exchange for publicity, and later, because they will be at a competitive disadvantage if they don't.
foobarqux 12y ago
But most people have to pay extra to acquire Bitcoins in the first place. And 10% is a promotion not a persistent discount. Why would I pay Dell in bitcoins in the long term given that Coinbase doesn't have any obvious cost advantage over other payment processors?
- baby 12y ago
  People who already have bitcoins can now spend them to get an Alienware. I know I would if I didn't lose mine.
  - gambiting 12y ago
    If it means that I can get $150 off a new Alienware machine I would go and create a wallet right now to buy some bitcoins.
- livingparadox 12y ago
  If you don't use bitcoin, there's absolutely no reason. Same reason for paypal et al. There are a group of people who prefer to use bitcoin as their payment method, and this is for them.
- mrb 12y ago
  You say "why would I spend bitcoins if I don't have any?" That's the problem of bootstrapping an economy. But I would like to point out that the history of Bitcoin demonstrates it is not such a big problem. Indeed more and more merchants are accepting it, more and more users are setting up wallets, more and more people are giving bitcoins to friends and family, etc. So given this adoption, at some point you will probably receive some bitcoins. Perhaps a friend will give you bitcoins as a birthday gift, or a coworker will insist to pay you back his sandwich in Bitcoin. Then you will say to yourself "hey, why not spend it on that ergonomic Dell keyboard"? And you will have played a role in bootstrapping the Bitcoin economy.
  - foobarqux 12y ago
    I don't think it is plausible that a significant number of people will receive a material portion of their income from Bitcoin. Your examples of ways in which I can receive BTC are trivial in amount and frequency.
- baddox 12y ago
  > But most people have to pay extra to acquire Bitcoins in the first place. What do you mean by "pay extra"? The functional exchange rate of that currency to bitcoins is the total cost of exchanging fiat currency for bitcoins.
  - foobarqux 12y ago
    Trading costs are an expense and you pay Coinbase more than the market spread (they need to make money). If you use a credit card to buy BTC you pay those fees directly or indirectly.
67726e 12y ago
> Well Dell wants to promote the currency Maybe. But that's probably just wishful thinking. Someone in marketing probably came up with this as a way to get some free publicity from all the raving bitcoin lunatics and get some sales. Offering 10% off of their Alienware systems, which are pretty well know as overpriced crap, is probably a fraction of their markup.
- bduerst 12y ago
  Right. As with Overstock, this is marketing ploy to a target demographic.
  - Alupis 12y ago
    My company started accepting bitcoin a few months back. We use BitPay.com to offload risk (they instantly convert a BTC payment into your preferred currency and cash you out at the going rate). We haven't made any sales with BTC yet... (as my VP reminds me weekly ;-), but none-the-less, the company views it as a great alternative to what normally would constitute a "high risk" shipment (usually to countries were high credit card fraud rates or other scams originate from... if we get our money now, and there is no risk of chargeback, etc, then we will ship the order). So, it's not really a "marketing ploy" as you put it, but rather a good vehicle to accept orders the company may have normally rejected due to too much risk.
    - doctorfoo 12y ago
      So, uh, what's the company? I got me some Bitcoins here. (Partially serious; chances are you don't sell what I need, but if you did, I'd rather support a Bitcoin accepting company.)
      - Alupis 12y ago
        Doubtful you would be interested in our products, although you never know! -- we're in the jewelry and crafting business. http://www.jewelrysupply.com/ http://www.jewelrysupply.com/ http://www.jewelrysupply.com/ordering_info.html http://www.jewelrysupply.com/ordering_info.html
battani 12y ago
> Well Dell wants to promote the currency Dell wants to promote Dell. And the Alienware promotion? Alienware is used primarily for video gaming. There's quite an overlap between the demographics that play video games and own bitcoin ("geeks"). This is Marketing 101.
Alupis 12y ago
> Well Dell wants to promote the currency so much they will be giving a discount What could be going on here is, Dell is speculating on BTC. So a 10% discount today in exchange for products they still make profit on, will result in potentially multitude of additional profit later. (The discount encourages people to give Dell their BTC, so Dell can sit on them and speculate... it's what a lot of the BTC payment processors are doing presumably).
- bequanna 12y ago
  Dell sells computers and peripherals. They aren't really in the business of alternative currency speculation. I doubt Dell management (at any level) would green-light gambling with company revenue. > it's what a lot of the BTC payment processors are doing presumably Maybe some, but certainly not most.

Zikes 12y ago

Whatever happened to that crisis where a single party got control of 51% of total network mining power giving them essentially 100% control over the blockchain? [1] [1] https://news.ycombinator.com/item?id=7890215 https://news.ycombinator.com/item?id=7890215

sp332 12y ago
They've voluntarily decided to limit themselves to 40%. https://arstechnica.com/business/2014/07/bitcoin-pool-ghash-io-commits-to-40-hashrate-limit-after-its-51-breach/ https://arstechnica.com/business/2014/07/bitcoin-pool-ghash-...
- jdong 12y ago
  And that 40% is still enough for lots of attacks.
  - michaeltoth 12y ago
    Not really. For an attack to be possible, the attacker needs to generate an alternate blockchain faster than the honest blockchain. This problem can be thought of as a binomial distribution where the "success" is the honest blockchain mining a block and extending its lead by a block and the "failure" is the attacking chain being extended by one, reducing the gap by 1 block. p = probability of honest blockchain extension by 1 block q = 1 - p = probability the attacker extends by 1 block If p <= q, the probability of the attacker catching up at some point in time is 1. This is what makes a 51% attack possible. If p > q, the probability of the attacker catching up is (q/p)^z where z is the number of blocks behind at the beginning of the attack. There is a reasonable possibility for small values of z (small number of blocks behind), that 40% control would allow for the creation of an alternate blockchain longer than the honest chain, but this is mitigated by the fact that transactions require confirmations, which extends the number of blocks and makes the likelihood of an attack very unlikely.
    - sp332 12y ago
      51% attack is not the only kind of attack. A "selfish mining" attack can break the system too. http://hackingdistributed.com/2013/11/04/bitcoin-is-broken/ http://hackingdistributed.com/2013/11/04/bitcoin-is-broken/ Here's the paper http://arxiv.org/abs/1311.0243 http://arxiv.org/abs/1311.0243

tabrischen 12y ago

Earlier this week, Shopify integrated with Coinbase to provide 100,000+ online stores with bitcoin checkout. It's really exciting to see bitcoin adoption rising among merchants of different sizes.

aroch 12y ago
I feel like merchant adoption is being done for the sake of "looking cool" not because they really care or their users really want it. Actual adoption of bitcoin by consumers has remained relatively flat
- jcliff 12y ago
  flat based on what?
  - dictum 12y ago
    Not sure if that's what the parent reply means, but while there's no baseline to compare growth in consumer usage of bitcoin, you can compare it to the growth in business acceptance of bitcoin.
  - aroch 12y ago
    The number of bitcoin transactions/day hasn't really changed, at all, despite all these vendors adopting it. http://blockchain.info/charts/n-transactions http://blockchain.info/charts/n-transactions
    - mrb 12y ago
      You fail at reading a graph (in your defense, the data is noisy). But smooth it by looking at the quarterly averages and it is clear there was a +40% growth from 45k to 65k transaction/day over the last year: http://i.imgur.com/XJs4V74.png http://i.imgur.com/XJs4V74.png (or see www.quandl.com/BCHAIN/NTRAN-Bitcoin-Number-of-Transactions and select "quarterly".)
      - 12y ago

yefim 12y ago

A huge win for Coinbase. Congratulations Brian and the rest of the team!

parfe 12y ago

Acceptance of bitcoin continues to increase, but has a store seen sustained usage? I recall a chart from a few weeks ago after newegg(?) began accepting bitcoins an initial glut of bitcoin transactions quickly dwindled to background noise. It seems once the novelty wears away people find it easier to just pay directly in USD.

chc 12y ago
Alternate theory: Bitcoin owners are disproportionately likely to be speculators who have no interest in ever spending Bitcoins except maybe once as a novelty.
- rockyleal 12y ago
  I have owned for a long time. This is not a good time to spend, that is all. The price seems to be artificially depressed right now, especially considering all the big companies starting to accept it. In a few months I will use them way more.
johmas 12y ago
We added a btc option at Tuft & Needle last November and up until about Feb was about 5% of our sales. btc purchases have been steadily dropping and are now around .01%
- aianus 12y ago
  Do you offer a discount for people paying in BTC? If not, why not?
doctorfoo 12y ago
I pay my monthly VPN subscription with BTC, and will continue to do so. That's not a store and certainly a niche, mind.

slg 12y ago

What I find interesting about all these new merchants accepting Bitcoin is what happens to the Bitcoin they receive. It is a safe bet that all of these Bitcoin are converted to USD immediately as part of the payment processing by someone like Coinbase. The question is, can Coinbase sell these coins as quickly as they receive them? If not, what kind of exposure do they have to the violatility of the price of Bitcoin? Is that exposure high enough that these companies could be brought down by a drop in Bitcoin pricing and would that lead to a collapse of the Bitcoin economy (i.e. are any of these too big to fail)?

rockyleal 12y ago
Impressive. You managed to turn the most positive news for Bitcoin into a post about the "collapse of the Bitcoin economy", through a very flimsily constrcted series of assumptions. There should be like a new version of Godwin's law wherein all positive Bitcoin news will lead to its collapse in three steps.
- krzrak 12y ago
  But slg raised interesting questions. That was the first thing I thought about as well after reading the article: will Dell (and other companies) keep the bitcoins? Rather not, the Coinbase will convert them to dollars immediately.
- tlrobinson 12y ago
  Likewise, any negative news about Bitcoin will be turned into "actually good news".
- larrys 12y ago
  Why don't you try and counter or answer what he is saying instead of attacking him for saying it.
  - rockyleal 12y ago
    Because it smells like a manipulative post. The goal (it seems) is not to discuss the topic, but to deformm the opinion of the readers and the general mood of the thread. If you want an answer, it is easy: companies like coinbase or bitpay know very well what they are doing, and participate in the market in ways that minimise the exposure risk. OP does not deserve to be top post in a site that is supposed to have quality debate like HN.

wallzz 12y ago

Is it just Dell.com or all the Dell's ?( dell.fr , dell.de ...)

vectorpush 12y ago

Notice how all these big "wins" for bitcoin come in the form of services facilitated by a centralized 3rd party. Coinbase, Bitpay, et al are becoming the de facto gatekeepers of bitcoin in business, it's not hard to imagine a future where these companies are the only practical option for real people interacting with the bitcoin economy. We're building a centralized infrastructure around the supposed decentralized currency of the future and these companies have extremely cumbersome KYC procedures; paypal never required me to scan a passport, take a selfie or submit to social graph analysis in order to use their services. edit: As some have pointed out, KYC is for buying bitcoin, not for making purchases with bitcoin, this is a fair point, but I think it's still noteworthy to recognize that most people will endure that KYC process to acquire bitcoins since the alternative is something like localbitcoins (scam prone and considerable effort for a newbie). Additionally, it's still true that for most people, the practical utility of bitcoin is a function of the services that these 3rd party companies are willing/able to provide, if some of these big players went bankrupt, suffered from long term DDOS, encounter legal problems or have their coins stolen by hackers, suddenly your average consumer has lost practical use of their bitcoins.

pavs 12y ago
I don't know about you but paypal asked me to send a picture of my id along with a recent picture of me. They froze my account until I did so.
ihsw 12y ago
The difference is that the BTC transaction system can operate independently of the incumbent transaction system.
evv 12y ago
It is only natural for centralized parties to emerge. I'd rather have centralized players with a decentralized back-end versus the banking system we rely on today. With paypal there is no consumer oversight, but because of the block chain, anybody can verify that coinbase acts as it should. And I'm not going to fault them for using every user authentication mechanism under the sun- it is the responsible way to operate.

lucb1e 12y ago

What's interesting is that they are limiting this borderless currency to US-only. But it doesn't take much to start accepting from other countries after they get through the legal complications, it probably won't take too long :)

MichaelGG 12y ago
Dell isn't actually doing anything with the Bitcoin, they're getting USD payments via Coinbase. And Coinbase appears to be US only and maybe US bank only? Their site says: "Right now the only supported payout option is USD to a bank account. However, options for other countries are planned." Which is a bit ambiguous but I think it may be only US bank accounts (or accounts accessible within the US system)?
- lucb1e 12y ago
  Very good point, thanks for the reply. One remark though: > "Dell isn't actually doing anything with Bitcoin" Perhaps not directly, but they don't go and accept any odd currency that comes along. It shows that Bitcoin is an interesting option to look at.
  - sanswork 12y ago
    Dell will accept any currency at all as long as Visa, Mastercard, Amex, etc will convert it to USD first.
    - lucb1e 12y ago
      Tell that to e-gold
- aianus 12y ago
  The Dell merchant account on Coinbase has to be US-based but there's no reason they can't accept BTC from anyone world-wide.

Keyframe 12y ago

I have a question. If business sells something directly for bitcoin (not via 3rd party which accepts bitcoin and proceeds cash), how do they do VAT?

gcp 12y ago
What does bitcoin have to do with this question? Hint: nothing.
- Keyframe 12y ago
  It has to do everything with it. If company sells something directly to a customer and is under VAT obligation and it takes bitcoins in exchange for goods.. how is VAT then distributed to tax collecting entity? I guess that's why 3rd party bitcoin processors are popular because business is getting cash, not bitcoins. I presume if they were collecting bitcoins directly, then it would be no different than dealing with non-convertible foreign currency, which is not a legal tender, and it would be impossible to deal with.
  - gcp 12y ago
    how is VAT then distributed to tax collecting entity? The same way it is with any other payment system, by having the vendor pay the tax collecting authority. Again, the payment system is totally irrelevant here. Seeing your clarification in the other response: As for the issue of the exchange rate and convertibility on taxes, I can only speak from the local law here, but the defining section of VAT regulations says that if the sale "contract" specifies the exchange rate between the used currency and EUR, that is the rate to be used for the calculation of VAT due. If you wouldn't mention the current Bitcoin/EUR rate on the invoice, you move into undefined territory.
deleted 12y ago
[deleted]
wmf 12y ago
If a business sells something directly for USD, how do they do VAT? (Assuming that the company is not in the US since the US doesn't have VAT.)

wsxcde 12y ago

We know that number of blockchain transactions has been more or less constant for a while and in the range of several tens of thousands per day. This means either merchants aren't seeing too many bitcoin sales OR a lot of these sales are happening offchain through coinbase/bitpay. In the latter scenario, coinbase just looks like a giant transaction fee with nothing changing except an entry in their database. Are they generating enough value to justify these fees? Note coinbase/bitpay makes money when (1) they sell you (the customer) bitcoin (2) the buy/sell spread when you buy btc (3) merchant fees and (4) buy/sell spread again when the purchase occurs. A big selling point for bitcoin was that you'd avoid credit card processing fees. Has someone done the math on whether this is turning out to actually be cheaper than credit cards after all fees are considered? And even if they turn out to be marginally cheaper, is it justified from the consumer's point of view given you don't even get the consumer protections that you get for free with a credit card?

mrb 12y ago
"number of blockchain transactions has been more or less constant" No: https://blockchain.info/charts/n-transactions?timespan=all&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address= https://blockchain.info/charts/n-transactions?timespan=all&s...
- vijayboyapati 12y ago
  Also the number of transactions per se is not the best measure of bitcoin's importance; it is the total purchasing power being transferred that should be considered. Bitcoin is a medium of savings that allows people to transfer value easily, from any point on the globe to any other point with minimal fees. The total purchasing power being transferred has growth tremendously because BOTH the number of transactions has grown AND the purchasing power of bitcoin has increased manyfold in the last few years. This, of course, does not even factor in all the transactions that happen off blockchain.
  - wsxcde 12y ago
    I think looking at transactions is a reasonable metric. In fact, even this metric may be overstating things. Tim Swanson has analyzed transactions excluding popular addresses (apparently this excludes things like SatoshiDice) to identify transactions that are positive-sum in an economic sense and then the numbers look even lower. [1] Another factor to consider is that if you count purchasing power transferred (which I assume means dollar value times transactions) you'll end up giving a lot of weight to events like when coinbase/mtgox moved their coins from one wallet to another. [1] http://www.ofnumbers.com/2014/06/23/separating-activity-from-growth-on-bitcoins-network/ http://www.ofnumbers.com/2014/06/23/separating-activity-from...

martinSlovakia 12y ago

Hi all, please for anybody's sake, can you explain me why the world is accepting something that we know is unsecured properly? Sometimes money just disappear etc..

josu 12y ago
Is there any properly secured money? Each type of money has its flaws and its advantages. For one, bitcoin is traceable to a certain degree, whreas a paper bill is not. >Sometimes money just disappear Are you talking about fiat money or bitcoin?
- martinSlovakia 12y ago
  bitcoin
  - josu 12y ago
    Sorry, it was rethorical. I wanted to point out that fiat money disappears all the time. I lose money all the time; it falls out of my pocket, I forget where I put it... However I have never lost any amount of bitcoin.
embolalia 12y ago
What do you mean by "just disappear"? People lose it, but because they lose the keys or passwords. It's not like the protocol causes it to poof away out of nowhere. It's entirely user error, and not terribly hard errors to avoid at that.
- martinSlovakia 12y ago
  I meant bitcoins stolen by hackers - in digital world where is practically no anonymity.. ..and what about that idea, where you buy HW with graphics card and you can earn bitcoins? It sounds so simple and unbelievable imho. That's why I am curious.
Crito 12y ago

the_rosentotter 12y ago

Anyone else noticing this story getting furiously downmodded? 250 points within two hours and buried under older, lesser stories. The bitcoin butthurt is strong here on Hacker News.

vectorpush 12y ago
HN stories cannot be downvoted.
- the_rosentotter 12y ago
  "Modded", not voted.

malloreon 12y ago

Title should be "Dell now accepts USD and doesn't care where it comes from!"

chesterbr 12y ago

Can I buy a server and only pay after I mine its price in bitcoins with it? :-) (pretty please with sugar, don't take this joke seriously)