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'What is the value proposition for consumers apart from sending money to friends? That's valuable, but it's not multi-billions of dollars worth of valuable' I
by Aqueous 12y ago
'What is the value proposition for consumers apart from sending money to friends? That's valuable, but it's not multi-billions of dollars worth of valuable'
It isn't? Western Union makes $5 billion in revenue every year. PayPal - and a reference to sending money to friends is literally the name of the company - also makes $5 billion in revenue every year.
- sillysaurus3 12y agoExcept Bitcoin makes it free to send money to friends. One way I could see this being financially viable to build a company around is if lots of people are storing money in the company's webwallet. Then the company could invest customers' money, like a bank. But if you are using a webwallet like Coinbase, then you are asking to get screwed out of your money, since there are no FDIC protections.
- sanswork 12y agoIts free if you have bitcoin and your friend wants bitcoin. Once you bring other currencies into the mix it is often more expensive to comparable services and just as slow if not slower.
- danbruc 12y agoAnd it is only free as long as mining new blocks covers the costs of running the network, after that you will have to pay fees.
- awt 12y agoAgreed. Bitcoin is not competitive for small transactions. Given the average transaction confirmation time of 7 minutes (which will never go down) it clearly was not meant to be.
- aianus 12y agoOnce the major mining pools receive the transaction, it's very unlikely to be double-spent. If you try to purchase something online from a merchant accepting Bitcoin via Coinbase or Bitpay, you'll notice the transaction completes almost instantaneously.
- baddox 12y ago> Its free if you have bitcoin and your friend wants bitcoin. Yes, that goes without saying. It's also true of paying friends with USD cash.
- rstupek 12y agoAlso it's not free for you to get your bitcoin into fiat.
- danbruc 12y agoExactly, it is mostly a solved problem. The question is, what value does Bitcoin add (for the average customer not interested to buy narcotics on Silk Road) and what is the price for this, for example unsolved security issues and large price fluctuations during the early adoption phase?
- awt 12y agoLet's be more general. Set A = stuff you can buy with USD. Set B = stuff you can buy with BTC. Set W = all stuff. Set A will always be a subset of set W, and is getting to be a smaller subset every day. Set B will in the future be an exact match for Set W. Which unit of account would you choose? A or B? edited: typo (C instead of B)
- danbruc 12y agoAssuming you meant set B with set C - what makes you believe set B will match set W one day? Especially right now set B is incredible tiny compared to set A and there is not much incentive to switch to B which in turn makes it unlikely that set B will quickly converge to set W.
- awt 12y agoMost people don't yet understand how infungible the USD is becoming. Argentenians and Venezuelans understand the infungibility of their national currencies much better than Americans do theirs. Wealthy Americans and the wealthy of other nationalities who travel understand it better than those with little savings who are largely bound to their own states. Only big players and those on the fringes of society notice the problems with the USD right now. As more people leave the official economy every day, the fringes grow larger. The more the US clamps down on foreign banks holding USD, the less attractive the USD will be as a store of wealth.
- danbruc 12y agoIsn't a currency fungible by definition - a dollar is a dollar is a dollar? And we are getting away from the question I asked - what are the advantages of using Bitcoins, advantages that average people actually care about today and that are not offset by disadvantages of using Bitcoins.