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While I appreciate the effort, I wonder why people think Bitcoin will gain mainstream adoption in the first place. Besides buying drugs online, what is really t

by inoop 12y ago

While I appreciate the effort, I wonder why people think Bitcoin will gain mainstream adoption in the first place. Besides buying drugs online, what is really the killer app here?

rplnt 12y ago
Getting rid of payment processors would benefit just about everyone. Only benefit they have is insurance.
- TylerE 12y ago
  For consumers that's a MASSIVE benefit.
  - aianus 12y ago
    Not really, the largest single transaction I've ever made on a credit card is maybe $2000 in flight tickets. At ~$30,000 a year in credit card spending I'm throwing that amount away in credit card fees every two and a half years. I'm perfectly capable of and would prefer the option to self-insure, thank you very much.
    - TylerE 12y ago
      Are you really naive enough to think that retailers won't just pocket whatever savings they have?
      - aianus 12y ago
        Retail is not a very high-margin industry, I imagine Walmart, Amazon, Airlines et al would pass on the savings.
    - myhf 12y ago
      Fees? Shouldn't you be getting that amount back in loyalty points?
      - aianus 12y ago
        Loyalty points change the numbers somewhat but the merchant is still paying two or three times more in fees than I'm getting back in points. Ultimately insurance always has a negative expected value for the average consumer. It makes sense to pay the vig to insure against catastrophic events like a car crash or a house fire, but insuring my daily credit card purchases like takeout meals, groceries, and gas is stupid.
  - vertex-four 12y ago
    In fact, insurance is a massive benefit for everyone but the biggest retailers - there's few who would shop at smaller retailers after the first couple of times they've been scammed, they'd prefer to stick to the Amazons and the Wal-marts, so the insurance is a necessity. However... bitcoin does allow new insurance providers to pop up - the insurance provider no longer has to be the same entity that holds your cash (your bank) or provides payment processing services. They could experiment with new models - multi-key escrow until service delivered, an "approved store" model where they'll provide insurance on purchases from stores that they've checked out without ever having to touch the money themselves, or more. This could all be cheaper than what your processor + bank combination costs, potentially. The thing is... that's not really good enough for customers. Nobody thinks enough about a few pennies per purchase to pick up a whole new currency.
- Perdition 12y ago
  You still have to buy Bitcoin. And given its volatility it is something you probably want to do on-demand, so now you have payment processors in the chain again.
- s73v3r 12y ago
  I have protection from fraudulent purchases when using my credit card. They also give me the ability to reverse a transaction if I am not satisfied. Bitcoin gives me none of this. If I pay someone in BTC for something, and when I receive the item, it's just a box full of rocks, I have no real recourse or ability to get my money back.
deleted 12y ago
[deleted]
mbrochh 12y ago
A few billion people who currently have no bank accounts could suddenly participate in global trade.
- maxerickson 12y ago
  Is it a foregone conclusion that bitcoin would be cheaper and easier to use than a "Cash Before Delivery" service? Bitcoin beats "Cash On Delivery" because it is trustless, but that's easy to address by having the delivery service allow a remit prior to the shipment. Note that with CBD, a (cash using) recipient has to deal with 1 party, with bitcoin they have to deal with 2 or 3 (obtain, spend, receive). Services would be somewhat different, but it still seems like quite an open question whether bitcoin would (in practice) be better than buying some credit from a payment provider (Paypal or Amazon or whatever).
  - markburns 12y ago
    That's true whilst it is treated as effectively a foreign currency. It may start to become irrelevant if bitcoin spreads and is generally held and used as a currency for earning income in, paying for labour/goods/services etc.
    - maxerickson 12y ago
      Sure, but I don't see how bitcoin becomes a very widespread payment mechanism without first being the best option for many transactions.
      - markburns 12y ago
        Yeah it's an obvious bootstrapping/critical mass problem. It will be interesting watching to see if it does cross that line. If the usability is never there I can imagine it never quite taking off, and something slightly better/more usable/with the right timing winning out. But you could have said the same thing about email/the web in the past. A global communication network and protocol without anyone using it is pointless. The same for a global value transfer protocol. It seems obvious _a_ protocol, probably blockchain based, will gain mass adoption eventually.
aminok 12y ago
You can transport value across the world instantly, with no intermediaries. This is a major efficiency gain. With the Lightning Network, you could transport any amount of value, instantly, for very close to zero cost, allowing things like paying a random untrusted party for WiFi by the second, with incremental micropayments.
- Someone1234 12y ago
  > You can transport value across the world instantly, with no intermediaries. This is a major efficiency gain. Only in a fictional world where my employer/clients pay me in bitcoin. In reality I need to go to an exchange, convert to bitcoin, then go back to either the same exchange or a different exchange and convert from bitcoin, all in all I've gone through two intermediaries and paid two fees. For one example if I did that on CoinMill they would charge me $2.59 over market for 1 bitcoin ($252~254 in value) and the same again when I convert it back to dollars. $5.18, that's approx. a 2% transaction fee. TransferWise by contrast (who really are super hassle free) charge $2.88 for one end-to-end transaction, so less than bitcoin(!). So yeah, your argument is completely broken in the real world. Only in a fictional world where everyone uses bitcoin does it work.
  - moe 12y ago
    Only in a fictional world where everyone uses bitcoin does it work. Why "everyone"? Wouldn't it be enough if a shop that has something that you want to buy accepts it? There's a great many shops accepting Bitcoin today already.
    - Someone1234 12y ago
      Still costs me $2.59 to transfer into bitcoin even in that scenario. Certainly doesn't result in: > You can transport value across the world instantly, with no intermediaries. This is a major efficiency gain. Since (A) there is an intermediary and (B) it is not efficiency (which I'm assuming is a euphemism for cheap anyway).
      - 12y ago
oafitupa 12y ago
While I appreciate the criticism, I wonder why Bitcoin detractors' main argument is always "it will never go mainstream", while by their definition of "mainstream" (ie. "the average person"), gold isn't mainstream either, and yet it's such a great store of value that even central banks use it.

by inoop 12y ago

While I appreciate the effort, I wonder why people think Bitcoin will gain mainstream adoption in the first place. Besides buying drugs online, what is really the killer app here?

rplnt 12y ago

Getting rid of payment processors would benefit just about everyone. Only benefit they have is insurance.

TylerE 12y ago
For consumers that's a MASSIVE benefit.
- aianus 12y ago
  Not really, the largest single transaction I've ever made on a credit card is maybe $2000 in flight tickets. At ~$30,000 a year in credit card spending I'm throwing that amount away in credit card fees every two and a half years. I'm perfectly capable of and would prefer the option to self-insure, thank you very much.
  - TylerE 12y ago
    Are you really naive enough to think that retailers won't just pocket whatever savings they have?
    - aianus 12y ago
      Retail is not a very high-margin industry, I imagine Walmart, Amazon, Airlines et al would pass on the savings.
  - myhf 12y ago
    Fees? Shouldn't you be getting that amount back in loyalty points?
    - aianus 12y ago
      Loyalty points change the numbers somewhat but the merchant is still paying two or three times more in fees than I'm getting back in points. Ultimately insurance always has a negative expected value for the average consumer. It makes sense to pay the vig to insure against catastrophic events like a car crash or a house fire, but insuring my daily credit card purchases like takeout meals, groceries, and gas is stupid.
- vertex-four 12y ago
  In fact, insurance is a massive benefit for everyone but the biggest retailers - there's few who would shop at smaller retailers after the first couple of times they've been scammed, they'd prefer to stick to the Amazons and the Wal-marts, so the insurance is a necessity. However... bitcoin does allow new insurance providers to pop up - the insurance provider no longer has to be the same entity that holds your cash (your bank) or provides payment processing services. They could experiment with new models - multi-key escrow until service delivered, an "approved store" model where they'll provide insurance on purchases from stores that they've checked out without ever having to touch the money themselves, or more. This could all be cheaper than what your processor + bank combination costs, potentially. The thing is... that's not really good enough for customers. Nobody thinks enough about a few pennies per purchase to pick up a whole new currency.
Perdition 12y ago
You still have to buy Bitcoin. And given its volatility it is something you probably want to do on-demand, so now you have payment processors in the chain again.
s73v3r 12y ago
I have protection from fraudulent purchases when using my credit card. They also give me the ability to reverse a transaction if I am not satisfied. Bitcoin gives me none of this. If I pay someone in BTC for something, and when I receive the item, it's just a box full of rocks, I have no real recourse or ability to get my money back.

deleted 12y ago

[deleted]

mbrochh 12y ago

A few billion people who currently have no bank accounts could suddenly participate in global trade.

maxerickson 12y ago
Is it a foregone conclusion that bitcoin would be cheaper and easier to use than a "Cash Before Delivery" service? Bitcoin beats "Cash On Delivery" because it is trustless, but that's easy to address by having the delivery service allow a remit prior to the shipment. Note that with CBD, a (cash using) recipient has to deal with 1 party, with bitcoin they have to deal with 2 or 3 (obtain, spend, receive). Services would be somewhat different, but it still seems like quite an open question whether bitcoin would (in practice) be better than buying some credit from a payment provider (Paypal or Amazon or whatever).
- markburns 12y ago
  That's true whilst it is treated as effectively a foreign currency. It may start to become irrelevant if bitcoin spreads and is generally held and used as a currency for earning income in, paying for labour/goods/services etc.
  - maxerickson 12y ago
    Sure, but I don't see how bitcoin becomes a very widespread payment mechanism without first being the best option for many transactions.
    - markburns 12y ago
      Yeah it's an obvious bootstrapping/critical mass problem. It will be interesting watching to see if it does cross that line. If the usability is never there I can imagine it never quite taking off, and something slightly better/more usable/with the right timing winning out. But you could have said the same thing about email/the web in the past. A global communication network and protocol without anyone using it is pointless. The same for a global value transfer protocol. It seems obvious _a_ protocol, probably blockchain based, will gain mass adoption eventually.

aminok 12y ago

You can transport value across the world instantly, with no intermediaries. This is a major efficiency gain. With the Lightning Network, you could transport any amount of value, instantly, for very close to zero cost, allowing things like paying a random untrusted party for WiFi by the second, with incremental micropayments.

Someone1234 12y ago
> You can transport value across the world instantly, with no intermediaries. This is a major efficiency gain. Only in a fictional world where my employer/clients pay me in bitcoin. In reality I need to go to an exchange, convert to bitcoin, then go back to either the same exchange or a different exchange and convert from bitcoin, all in all I've gone through two intermediaries and paid two fees. For one example if I did that on CoinMill they would charge me $2.59 over market for 1 bitcoin ($252~254 in value) and the same again when I convert it back to dollars. $5.18, that's approx. a 2% transaction fee. TransferWise by contrast (who really are super hassle free) charge $2.88 for one end-to-end transaction, so less than bitcoin(!). So yeah, your argument is completely broken in the real world. Only in a fictional world where everyone uses bitcoin does it work.
- moe 12y ago
  Only in a fictional world where everyone uses bitcoin does it work. Why "everyone"? Wouldn't it be enough if a shop that has something that you want to buy accepts it? There's a great many shops accepting Bitcoin today already.
  - Someone1234 12y ago
    Still costs me $2.59 to transfer into bitcoin even in that scenario. Certainly doesn't result in: > You can transport value across the world instantly, with no intermediaries. This is a major efficiency gain. Since (A) there is an intermediary and (B) it is not efficiency (which I'm assuming is a euphemism for cheap anyway).
    - 12y ago

oafitupa 12y ago

While I appreciate the criticism, I wonder why Bitcoin detractors' main argument is always "it will never go mainstream", while by their definition of "mainstream" (ie. "the average person"), gold isn't mainstream either, and yet it's such a great store of value that even central banks use it.