8 ms·

BitPay's New Plan

132 points by josu 12y ago

josu 12y ago
From reddit[0]: >Hey, everyone! This is BitPay. We know you have a lot of questions so we'll be doing an AMA at 12:00PM EST (today) on r/Bitcoin [0] http://www.reddit.com/r/Bitcoin/comments/2c510m/bitpays_new_plan_free_unlimited_forever/cjbzfdz http://www.reddit.com/r/Bitcoin/comments/2c510m/bitpays_new_...
- josu 12y ago
  The actual AMA: http://www.reddit.com/r/Bitcoin/comments/2c5f1l/bitpay_here_excited_to_announce_zero_processing/ http://www.reddit.com/r/Bitcoin/comments/2c5f1l/bitpay_here_...
  - opendais 12y ago
    Thanks!
rhino369 12y ago
I'm sure they are just hiding the fees in the exchange rate. Which could be much more than 1% or whatever they were charging.
- onestone 12y ago
  These hidden fees would only apply if you choose to receive fiat settlements (which I wouldn't).
- pmorici 12y ago
  A user on Reddit checked out the exchange rate spread between them and Coinbase and found was about $1. That is about 0.17% at the current prices. An incredible deal by any measure.
  - rhino369 12y ago
    Almost too incredible. They must dump the coins on the market right away to less volatility risk. Did they check the exchange rate for buying on Coinbase or selling. Coinbase might be playing with the exchange rate too.
    - wcummings 12y ago
      >They must dump the coins on the market right away to less volatility risk. If they had any reasonable volume wouldn't it make more sense to stagger their selling? On a long enough timeline it'd probably even out, especially if they did something more clever than "sell X% every Y minutes"
    - pmorici 12y ago
      They may have agreements with private buyers like the SecondMarket Bitcoin trust that would help move a lot of coins w/o moving the market and being exposed to second by second price changes.
- mrb 12y ago
  BitPay said they will get (most?) of their revenue from their paying Business and Enterprise plan customers: http://www.reddit.com/r/Bitcoin/comments/2c5f1l/bitpay_here_excited_to_announce_zero_processing/cjc52c2 http://www.reddit.com/r/Bitcoin/comments/2c5f1l/bitpay_here_...
- runeks 12y ago
  They claim to get you market rates: https://bitpay.com/bitcoin-exchange-rates https://bitpay.com/bitcoin-exchange-rates
- opendais 12y ago
  Idk, at $300/month/business...I doubt it. The reality is a business doing $30k/month is going to pay for the phone support. Hell, I'd do it at $6k/month. At which point, they may actually make more that way.
wesley 12y ago
Very nice, does anyone know if they'll ever accept anything other than bitcoin? Altcoins like NXT etc?
- wyager 12y ago
  Why would they bother? The transaction rate (in USD/time) is microscopic in altcoins.
  - mapleoin 12y ago
    > The transaction rate (in USD/time) is microscopic in altcoins. I believe the word you're looking for is liquidity.
    - m0llusk 12y ago
      Money Talks: Learning the language of finance by John Lanchester (The Danger of Financial Jargon) http://www.newyorker.com/magazine/2014/08/04/money-talks-6 http://www.newyorker.com/magazine/2014/08/04/money-talks-6
    - wyager 12y ago
      I'm no economist, but isn't it possible to have an illiquid market despite high volume?
    - ramchip 12y ago
      That's just volume, not liquidity.
- josu 12y ago
  They said in their recent AMA that they have no plans of accepting altcoins.
- deleted 12y ago
  [deleted]
donretag 12y ago
Remember usa.net/netaddress.com? "With USA.NET® Net@ddress®, ... have one email address for the rest of your life for free!" http://web.archive.org/web/20001218082700/http://usa.net/personal/ http://web.archive.org/web/20001218082700/http://usa.net/per... I'm not buying into free + forever.
- mastermojo 12y ago
  Well, free for as long as the company is around. For the next couple years: Do you expect Google (search) to be free? Facebook? Mongodb? Companies can build successful businesses around not charging for the core service.
  - jMyles 12y ago
    Mongodb doesn't really belong in that list, though.
  - nly 12y ago
    Saying Google and Facebook have built successful businesses around free services is like saying dairy farmers have built successful businesses around offering cows free grass.
    - alistairjcbrown 12y ago
      That's a great analogy!
- wmf 12y ago
  Realistically if BitPay screws up you take a few hours to switch to Coinbase and move on. It's not like an email address.
  - heynk 12y ago
    If you use BitPay as a payment processor I don't think it would be as easy as, say, swapping out BTC addresses, because of different implementations of webhooks and other APIs.
ericcholis 12y ago
Anybody have reading for a merchant evaluating Bitcoin as another payment option?
- walden42 12y ago
  Read up some articles from Coinbase or Bitpay. You can also contant Bitpay with any questions you may have and I'm sure they'll be able to help you. Also feel free to ask me anything, as well, and I'll try to help you out.
kakashi19 12y ago
the part scares me the most - "Free Forever"
- Istof 12y ago
  maybe that means that they plan to sellout
crxgames 12y ago
This is fantastic news. I just setup my online store to support Bitpay last night! Can't wait to see how this turns out. Even if they end up charging a percentage, paypal/stripe are almost 3% so anything less than that is great.
StavrosK 12y ago
Can someone explain what this is, exactly? Is it a fee-free way for people to accept Bitcoin on their site/shop?
- natrius 12y ago
  It's a fee free way to effectively accept Bitcoin as debit cards. The local currency value of the transaction is deposited in the merchants bank account. The merchant never needs to care about exchange rate fluctuations. There's really no reason for a merchant not to accept Bitcoin at this point.
  - StavrosK 12y ago
    Ah, thanks, so it's like Coinbase's Bitcoin thing, except with no fees. Very nice. I don't much understand why people worry about the "free forever" part, though. Surely, if they become too expensive, you can just switch?
    - wmf 12y ago
      I don't know if people are actually worrying or just bragging about how cynical they are. The whole "don't pretend you wouldn't sell out" thing is a HN cliche at this point.
pbreit 12y ago
Rant: blogs lacking links to the company's web site (towards the top) are annoying.
deleted 12y ago
[deleted]
bitcoinnerd 12y ago
2 things I am thinking: 1. If Bitpay was making a lot of money on payment processing, would they have gone to free forever? No! - The reason is payment processing does not generate much cash! Certainly nothing that can support a 60 person team that bitpay has. - There is very little bitcoin payment volume and not expected to be much in the near future. Honestly, despite how much press coverage it gets whenever a merchant accepts bitcoin. No one is doing big volume through bitcoin. Certainly not at a volume that is meaningful to a processor. - Bitpay says they processed 100m in transaction last year. That is false. Bitcoin price was around $100 most of the year. And in December it went to $1000/btc. And so they took $1000 and applied that to all the sales throughout the entire year - They recently have a massive change in strategy when Tony Gallipi stepped down as the CEO and Stephen Pair became the CEO (original CTO). This is important, because since then the strategy became open source focused (very much like Redhat for bitcoin) 2. Bitcoin payment processing has incredibly low barrier to entry. - Unlike visa and mastercard which has massive barrier to entry. Vanilla Bitcoin payment processing really just involves less than 100 lines of code. Like Step 1: Use BIP32 to safely and securely accept payments (Keep the private key offline and derive addresses using the master public key on the server). Step 2: Write a little script to run locally to hook up to a API to sell the bitcoin. Voila, you have basically got bitpay. Like many other internet based service, the fees eventually trends towards 0. Unfortunately, monetization of bitcoin payments is going to look very different than the traditional visa/mastercard/paypal model and it cannot come from vanilla fees alone. Because what used to be proprietary network/technologies has been mostly replaced by the bitcoin protocol itself. And so value has to come from somewhere else.
- wcummings 12y ago
  >Bitpay says they processed 100m in transaction last year. That is false. Bitcoin price was around $100 most of the year. And in December it went to $1000/btc. And so they took $1000 and applied that to all the sales throughout the entire year Did they say this, or are you just conjecturing?
  - bitcoinnerd 12y ago
    It is pretty much open secret amongst the bitcoin crowd. They didn't announce it of course. But next time you meet someone from bitpay, explicitly ask them how that $100m is calculated.
twodayslate 12y ago
They are planning on making their money thru their Business and Enterprise plans https://bitpay.com/pricing https://bitpay.com/pricing
- bitcoinnerd 12y ago
  I don't buy it. How much money are they going to make from those plans? A grand here and there from the big clients and a hundred bucks from the small clients? Their annual run rate is at least 6-7 million dollars a year if not more. I think this is just part of a greater shift in strategy in focusing on becoming the redhat for bitcoin. And thus opening up all their payment processing tech for free. Pure speculations, but I will not be surprised if they eventually open source their core payment processing as well.

132 points by josu 12y ago

josu 12y ago

From reddit[0]: >Hey, everyone! This is BitPay. We know you have a lot of questions so we'll be doing an AMA at 12:00PM EST (today) on r/Bitcoin [0] http://www.reddit.com/r/Bitcoin/comments/2c510m/bitpays_new_plan_free_unlimited_forever/cjbzfdz http://www.reddit.com/r/Bitcoin/comments/2c510m/bitpays_new_...

josu 12y ago
The actual AMA: http://www.reddit.com/r/Bitcoin/comments/2c5f1l/bitpay_here_excited_to_announce_zero_processing/ http://www.reddit.com/r/Bitcoin/comments/2c5f1l/bitpay_here_...
- opendais 12y ago
  Thanks!

rhino369 12y ago

I'm sure they are just hiding the fees in the exchange rate. Which could be much more than 1% or whatever they were charging.

onestone 12y ago
These hidden fees would only apply if you choose to receive fiat settlements (which I wouldn't).
pmorici 12y ago
A user on Reddit checked out the exchange rate spread between them and Coinbase and found was about $1. That is about 0.17% at the current prices. An incredible deal by any measure.
- rhino369 12y ago
  Almost too incredible. They must dump the coins on the market right away to less volatility risk. Did they check the exchange rate for buying on Coinbase or selling. Coinbase might be playing with the exchange rate too.
  - wcummings 12y ago
    >They must dump the coins on the market right away to less volatility risk. If they had any reasonable volume wouldn't it make more sense to stagger their selling? On a long enough timeline it'd probably even out, especially if they did something more clever than "sell X% every Y minutes"
  - pmorici 12y ago
    They may have agreements with private buyers like the SecondMarket Bitcoin trust that would help move a lot of coins w/o moving the market and being exposed to second by second price changes.
mrb 12y ago
BitPay said they will get (most?) of their revenue from their paying Business and Enterprise plan customers: http://www.reddit.com/r/Bitcoin/comments/2c5f1l/bitpay_here_excited_to_announce_zero_processing/cjc52c2 http://www.reddit.com/r/Bitcoin/comments/2c5f1l/bitpay_here_...
runeks 12y ago
They claim to get you market rates: https://bitpay.com/bitcoin-exchange-rates https://bitpay.com/bitcoin-exchange-rates
opendais 12y ago
Idk, at $300/month/business...I doubt it. The reality is a business doing $30k/month is going to pay for the phone support. Hell, I'd do it at $6k/month. At which point, they may actually make more that way.

wesley 12y ago

Very nice, does anyone know if they'll ever accept anything other than bitcoin? Altcoins like NXT etc?

wyager 12y ago
Why would they bother? The transaction rate (in USD/time) is microscopic in altcoins.
- mapleoin 12y ago
  > The transaction rate (in USD/time) is microscopic in altcoins. I believe the word you're looking for is liquidity.
  - m0llusk 12y ago
    Money Talks: Learning the language of finance by John Lanchester (The Danger of Financial Jargon) http://www.newyorker.com/magazine/2014/08/04/money-talks-6 http://www.newyorker.com/magazine/2014/08/04/money-talks-6
  - wyager 12y ago
    I'm no economist, but isn't it possible to have an illiquid market despite high volume?
  - ramchip 12y ago
    That's just volume, not liquidity.
josu 12y ago
They said in their recent AMA that they have no plans of accepting altcoins.
deleted 12y ago
[deleted]

donretag 12y ago

Remember usa.net/netaddress.com? "With USA.NET® Net@ddress®, ... have one email address for the rest of your life for free!" http://web.archive.org/web/20001218082700/http://usa.net/personal/ http://web.archive.org/web/20001218082700/http://usa.net/per... I'm not buying into free + forever.

mastermojo 12y ago
Well, free for as long as the company is around. For the next couple years: Do you expect Google (search) to be free? Facebook? Mongodb? Companies can build successful businesses around not charging for the core service.
- jMyles 12y ago
  Mongodb doesn't really belong in that list, though.
- nly 12y ago
  Saying Google and Facebook have built successful businesses around free services is like saying dairy farmers have built successful businesses around offering cows free grass.
  - alistairjcbrown 12y ago
    That's a great analogy!
wmf 12y ago
Realistically if BitPay screws up you take a few hours to switch to Coinbase and move on. It's not like an email address.
- heynk 12y ago
  If you use BitPay as a payment processor I don't think it would be as easy as, say, swapping out BTC addresses, because of different implementations of webhooks and other APIs.

ericcholis 12y ago

Anybody have reading for a merchant evaluating Bitcoin as another payment option?

walden42 12y ago
Read up some articles from Coinbase or Bitpay. You can also contant Bitpay with any questions you may have and I'm sure they'll be able to help you. Also feel free to ask me anything, as well, and I'll try to help you out.

kakashi19 12y ago

the part scares me the most - "Free Forever"

Istof 12y ago
maybe that means that they plan to sellout

crxgames 12y ago

This is fantastic news. I just setup my online store to support Bitpay last night! Can't wait to see how this turns out. Even if they end up charging a percentage, paypal/stripe are almost 3% so anything less than that is great.

StavrosK 12y ago

Can someone explain what this is, exactly? Is it a fee-free way for people to accept Bitcoin on their site/shop?

natrius 12y ago
It's a fee free way to effectively accept Bitcoin as debit cards. The local currency value of the transaction is deposited in the merchants bank account. The merchant never needs to care about exchange rate fluctuations. There's really no reason for a merchant not to accept Bitcoin at this point.
- StavrosK 12y ago
  Ah, thanks, so it's like Coinbase's Bitcoin thing, except with no fees. Very nice. I don't much understand why people worry about the "free forever" part, though. Surely, if they become too expensive, you can just switch?
  - wmf 12y ago
    I don't know if people are actually worrying or just bragging about how cynical they are. The whole "don't pretend you wouldn't sell out" thing is a HN cliche at this point.

pbreit 12y ago

Rant: blogs lacking links to the company's web site (towards the top) are annoying.

deleted 12y ago

[deleted]

bitcoinnerd 12y ago

2 things I am thinking: 1. If Bitpay was making a lot of money on payment processing, would they have gone to free forever? No! - The reason is payment processing does not generate much cash! Certainly nothing that can support a 60 person team that bitpay has. - There is very little bitcoin payment volume and not expected to be much in the near future. Honestly, despite how much press coverage it gets whenever a merchant accepts bitcoin. No one is doing big volume through bitcoin. Certainly not at a volume that is meaningful to a processor. - Bitpay says they processed 100m in transaction last year. That is false. Bitcoin price was around $100 most of the year. And in December it went to $1000/btc. And so they took $1000 and applied that to all the sales throughout the entire year - They recently have a massive change in strategy when Tony Gallipi stepped down as the CEO and Stephen Pair became the CEO (original CTO). This is important, because since then the strategy became open source focused (very much like Redhat for bitcoin) 2. Bitcoin payment processing has incredibly low barrier to entry. - Unlike visa and mastercard which has massive barrier to entry. Vanilla Bitcoin payment processing really just involves less than 100 lines of code. Like Step 1: Use BIP32 to safely and securely accept payments (Keep the private key offline and derive addresses using the master public key on the server). Step 2: Write a little script to run locally to hook up to a API to sell the bitcoin. Voila, you have basically got bitpay. Like many other internet based service, the fees eventually trends towards 0. Unfortunately, monetization of bitcoin payments is going to look very different than the traditional visa/mastercard/paypal model and it cannot come from vanilla fees alone. Because what used to be proprietary network/technologies has been mostly replaced by the bitcoin protocol itself. And so value has to come from somewhere else.

wcummings 12y ago
>Bitpay says they processed 100m in transaction last year. That is false. Bitcoin price was around $100 most of the year. And in December it went to $1000/btc. And so they took $1000 and applied that to all the sales throughout the entire year Did they say this, or are you just conjecturing?
- bitcoinnerd 12y ago
  It is pretty much open secret amongst the bitcoin crowd. They didn't announce it of course. But next time you meet someone from bitpay, explicitly ask them how that $100m is calculated.

twodayslate 12y ago

They are planning on making their money thru their Business and Enterprise plans https://bitpay.com/pricing https://bitpay.com/pricing

bitcoinnerd 12y ago
I don't buy it. How much money are they going to make from those plans? A grand here and there from the big clients and a hundred bucks from the small clients? Their annual run rate is at least 6-7 million dollars a year if not more. I think this is just part of a greater shift in strategy in focusing on becoming the redhat for bitcoin. And thus opening up all their payment processing tech for free. Pure speculations, but I will not be surprised if they eventually open source their core payment processing as well.