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Bitcoin's Use in Commerce Keeps Falling

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Re: Bitcoin's Use in Commerce Keeps Falling

#21
A currency with no mechanism for monetary policy is not going to be adopted. Bitcoin is purely deflationary for more reasons than just people losing their keys.

For example, a fixed reward split between a growing group of miners will also cause a rising price floor. The miners will not sell for less than their electricity costs, which makes the smaller piece of the block reward they receive have a higher price.

So you have this asset you call a currency but it is always deflationary. No one will set prices in that. Think of it in terms of setting a salary. One month you are paying the equivalent of 1000 dollars, the next you are paying 2000. Since this has no way of stabilizing it will never become a true base currency.

Instead, at best, it serves as a pass through to a fiat currency. So it is acting as a payment processor but very inefficiently. Slow transaction speeds, expensive, difficult to acquire.

The price is driven by speculative demand. It honestly is more like a digital collectible than a currency (sign up to receive one of 21 million e coins, be part of history).

Re: Bitcoin's Use in Commerce Keeps Falling

#23
post #16
post #13

Earlier quoted context omitted.

Also, money works pretty well. Bitcoin is not 10x better. Maybe 0.1x. Bitcoin is not even useful for illicit transactions anymore.

By money you mean what exactly? Anything in a bank account is not money but promise of money that can be taken away without your knowledge. Any specific currency is subject to whim of corresponding central bank. Sure, some are safer than others but still. Even the right to participate is not a given as you can be banned from opening a bank account. Bitcoin is orders of magnitude better money than anything else in eve…

> in every aspect except convenience

And yet convenience is the only aspect 99.9999% of consumers care about because they never have and never will experience any of the other problems you mention.

Re: Bitcoin's Use in Commerce Keeps Falling

#24

The primary utility of money is this: it is the good that best lends itself to exchanges for other goods. Its been clear to me for some time now, and I'm not alone in this, that as the properties of Bitcoin have moved further away from its primary function as a useful unit of exchange that its usage would decline. There are other crypto-currencies which are now much better suited as a medium of exchange, which ones p…

Isn’t this issue inherent in its design? If you can only have 21 million Bitcoins, the value will skyrocket until the currency is worthless.

Re: Bitcoin's Use in Commerce Keeps Falling

#25
post #16
post #13

Earlier quoted context omitted.

Also, money works pretty well. Bitcoin is not 10x better. Maybe 0.1x. Bitcoin is not even useful for illicit transactions anymore.

By money you mean what exactly? Anything in a bank account is not money but promise of money that can be taken away without your knowledge. Any specific currency is subject to whim of corresponding central bank. Sure, some are safer than others but still. Even the right to participate is not a given as you can be banned from opening a bank account. Bitcoin is orders of magnitude better money than anything else in eve…

>Bitcoin is orders of magnitude better money than anything else in every aspect except convenience, but it’s getting there.

Firstly, if you think money exists for any reason other than convenience, you fundamentally misunderstand why money exists. Its whole purpose is convenience, to make trade easier.

Secondly, the points above are more than just convenience. You have no recourse in cases of fraud or crime when it comes to bitcoin. It costs more to use. And it can be used in much fewer businesses. Those aren't just conveniences; those are fundamental issues of interest to consumers.

Re: Bitcoin's Use in Commerce Keeps Falling

#26
post #10

It has been clear for a while now that Bitcoin is an inferior payment system for the consumer: * The fees are higher. * The risk to the consumer is higher. * The difficulty of use is higher. * It is accepted at an extremely low amount of vendors and even that is falling. So you really how to wonder why people ever thought consumers would use it en masse.

One of your points is of dubious validity: fees may not be higher.

Fees went very high when the network became congested; but when it’s not congested, they’re much lower than credit card systems are for normal businesses.

https://bitcoinfees.earn.com/ suggests that right now, what equates to about nine US cents is sufficient for a basic transaction. And if you’re happy to wait an hour, then two cents ought to do you fine.

I’m not sure whether this is a typical rate; I haven’t been keeping an eye on it, and https://core.jochen-hoenicke.de/queue/#30d is hard to read casually. But by the looks of it, a very substantial fraction of transactions have been going through at what will be under ten cents if they’re simple transactions.

Your standard sorts of base rates for accepting credit card transactions are 30¢ + 1.75–2.9%, depending on certain conditions like country and card type.

Re: Bitcoin's Use in Commerce Keeps Falling

#28
post #10

It has been clear for a while now that Bitcoin is an inferior payment system for the consumer: * The fees are higher. * The risk to the consumer is higher. * The difficulty of use is higher. * It is accepted at an extremely low amount of vendors and even that is falling. So you really how to wonder why people ever thought consumers would use it en masse.

One of your points is of dubious validity: fees may not be higher. Fees went very high when the network became congested; but when it’s not congested, they’re much lower than credit card systems are for normal businesses. https://bitcoinfees.earn.com/ suggests that right now, what equates to about nine US cents is sufficient for a basic transaction. And if you’re happy to wait an hour, then two cents ought to do you…

Yes. But don't forget credit cards offer others services, such as charge refund and fraud protection

Re: Bitcoin's Use in Commerce Keeps Falling

#29
post #28

Earlier quoted context omitted.

One of your points is of dubious validity: fees may not be higher. Fees went very high when the network became congested; but when it’s not congested, they’re much lower than credit card systems are for normal businesses. https://bitcoinfees.earn.com/ suggests that right now, what equates to about nine US cents is sufficient for a basic transaction. And if you’re happy to wait an hour, then two cents ought to do you…

Yes. But don't forget credit cards offer others services, such as charge refund and fraud protection

I am only quibbling on the statement about fees, not the rest.

Re: Bitcoin's Use in Commerce Keeps Falling

#30
By no means am I a bitcoin-enthusiast, but I've shared this story before:

> We had to send a payment to someone who lives in a commonwealth country - what a pain in the ass that was. For the first time I actually saw a use for bitcoin, but the volatility and my general desire not to run afoul of any weird money laundering laws got the better of me.

I do think there's a legitimate case for bitcoin as a means of getting around FX and just the general inaneness of international banking.

That being said, I'm sure that there are plenty of reasons why that'll never come to fruition (e.g. as I noted, AML rules).

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