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Square Market Accepts Bitcoin

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Re: Square Market Accepts Bitcoin

#81

Post by tim333 »

jusben1369 wrote: post #15

When Bitcoin's are converted to a fiat currency that's now a taxable event correct? That's when the gain or loss is "realized" So if you pay in Bitcoin and the platform/processor immediately converts it into $US to pay the merchant does that create a taxable event for the seller? I suspect people would like to pay in Bitcoin to a merchant who accepts and keeps it in Bitcoin so that a gain is not realized and no taxab…

Tax is a bit of a funny business and the laws vary from country to country and the enforcement of the law varies in random ways. For example if as a brit you buy some euros to spent on holiday and then the euro appreciates before you buy your tequila you've made a taxable gain. In practice no one declares that stuff and the revenue never investigates that stuff. At some point they start worrying - I'm not sure where. It depends on the mood. I recently had to account for the sale of a holiday home in euros and then converted into sterling and didn't bother with the change in pound euro rate as it didn't make much difference. Maybe £500 one way or the other. The UK revenue in practice don't really make a fuss unless you are off by serval thousand although they don't publish a fixed figure or else everyone would game their taxes to be off by just under that amount. So in practice with bitcoin if the gains are a few pounds people won't bother. If they are say £30k you should probably declare it or risk pissing off the tax authorities. In the US I don't know - they seem a bit more up tight about enforcing the letter of the law over petty amounts but you can only really tell by looking at what they do because if they published people would game the system.

Re: Square Market Accepts Bitcoin

#82

Post by xpda »

jusben1369 wrote: post #15

When Bitcoin's are converted to a fiat currency that's now a taxable event correct? That's when the gain or loss is "realized" So if you pay in Bitcoin and the platform/processor immediately converts it into $US to pay the merchant does that create a taxable event for the seller? I suspect people would like to pay in Bitcoin to a merchant who accepts and keeps it in Bitcoin so that a gain is not realized and no taxab…

It has always been a taxable event. If you buy anything and sell or trade it for a profit, you owe income tax (in the U.S.), be it gold, water, wheat, or Hungarian forints. The IRS just confirmed that bitcoins are assets and not currency, which has a few different rules.

Re: Square Market Accepts Bitcoin

#83

Post by oafitupa »

steveklabnik wrote: post #53
my_username_is_ wrote: post #44

Earlier quoted context omitted.

What's the reason for this? Is it part of Coinbase's payment integration? I don't recall any other websites doing this (although there's the possibility that I simply haven't used other sites that also do this)

There are a couple of reasons, actually. This will be a short version of something I'm still in the process of writing, so consider this very high level, broad strokes. Consider "Coinbase" a stand-in for any service like it. I also know that lots of Bitcoin enthusiasts won't agree with me, and that's fine. The most important one is that merchants generally want USD, not BTC. Instant Exchange is a really important fea…

"Websites don't actually accept USD, for example: they accept Visa"

This has to be a joke. Are you going to ignore the part where I you can't send USD over the wire? Websites would definitely accept USD, if they could.

Re: Square Market Accepts Bitcoin

#84

Post by rpearl »

plaguuuuuu wrote: post #50
johncoogan wrote: post #45

Does anyone have an opinion on why the price of Bitcoin doesn't seem to move on news like this? It seems significant in my opinion and I would think that wider acceptance would lead to a higher price, but that hasn't been the case over the past few weeks / announcements.

A $10 t-shirt will still cost $10 worth of bitcoins. Whether that winds up being 1 or 1000 bitcoins is totally irrelevant. There's no intrinsic value

Your statement is useless, which is why it has been downvoted. It misses the essence of what currency is.

Volatility makes bitcoin a poor store of value: you should not leave assets in bitcoin that you cannot afford to lose, because those assets may vary in actual value (meaning, might vary in what someone else is willing to pay for it) substantially over time: $10,000 of bitcoin today might be $5,000 tomorrow.

Volatility makes bitcoin a poor medium of exchange: if I wish to sell something with bitcoin, I take on large risk that the value of my transaction might change. The t-shirt I sold for $10 today might yield me only $2 tomorrow.

So, it is accurate to say that there is no intrinsic value to a bitcoin--but this statement is meaningless. $10 is also not an intrinsic value--currency is only relevant as a unit of account or a medium of exchange. Things only have value relative to each other. We use currency to assign a numeric value to each object.

Re: Square Market Accepts Bitcoin

#85

Post by abalone »

This is a strange case for bitcoin, competing with credit cards. Most consumers would be better off paying with a card: same cost (none), more protections (the ability to dispute bad merchants over defective goods).

It's not a bad idea for Square to add it, since some people have bitcoins obtained through speculation, mining, cheap money transfers, and so forth. But even so, they would be a little better served paying by card, due to the extra consumer protections they'd enjoy.

Where bitcoin makes more sense to me is in replacing cash. But that mostly makes sense to me in the real world where you can inspect goods and whatnot in advance of cash payments. (There's maybe some potential for it online in the form of micropayments, where trust and protections don't matter so much.)

But for online sellers that already accept cards, I have yet to hear why bitcoin reflects a better choice than cards for the consumer. Anonymity maybe? For the average consumer, not worth the tradeoff in lack of ripoff protection.

Sellers would be better off, sure, but don't forget it's a two-sided market and consumers are heavily incentivized to use cards. Most of those "high fees" are funneled back to the consumer's pocket in the form of benefits and rewards. It's a form of lock-in to the CC system.

Re: Square Market Accepts Bitcoin

#86

Post by johnpmayer »

johncoogan wrote: post #45

Does anyone have an opinion on why the price of Bitcoin doesn't seem to move on news like this? It seems significant in my opinion and I would think that wider acceptance would lead to a higher price, but that hasn't been the case over the past few weeks / announcements.

Well, personally, I'm still paid in dollars. And dollars can already be used in all of these places.

Re: Square Market Accepts Bitcoin

#87

Post by DigitalSea »

It'll be interesting to see if this announcement actually helps increase the price of Bitcoin which has taken a few hits over the last few months due to countless exchanges being hacked and collapsing (one of those being Mt Gox), to the IRS's announcement proclaiming Bitcoin is property not currency and other bumps in the road.

Initial indications seem to suggest this far the announcement has done little to raise the price of Bitcoin. Time will tell and I personally think this is a great step in the right direction, eventually even Paypal will allow you to accept Bitcoin, it is only a matter of time.

Re: Square Market Accepts Bitcoin

#88

Post by hendzen »

steveklabnik wrote: post #62
nathancahill wrote: post #59

Earlier quoted context omitted.

Sorry Steve, I have a lot of respect for everything you're doing at Balanced, but wow.. everything about this is wrong. 1. "Merchants generally want USD, not BTC". Coinbase supports BTC -> USD. It's an exchange. You don't need to use their OAuth to convert BTC to USD. 2. "The UX is vastly superior to using a bare address". If you're using Bitcoin, you better know how to use an address. Not sure how that would be conf…

1. Yes, I understand Instant Exchange is separate. This is about how we wouldn't roll our own solution, _someone_ would be powering our Bitcoin integration. 2. Yes, as I said, if you know what's going on, it won't be weird to you. That said, cart abandonment is a big problem, as is keeping checkout pages as simple as possible. 3. Again, this is where we'll have to disagree. You say "people are using Bitcoin to get aw…

Regarding raw addresses, I would encourage you to look into the payment protocol (BIP70). Once that is widespread (it is already implemented in some wallets), the average BTC user will never have to worry about raw addresses, without the downside of having to route everything through coinbase. As a plus, the UX is IMO, better than that of typing in a CC number.

Re: Square Market Accepts Bitcoin

#90

Post by acchow »

ycombasks wrote: post #79
Lerc wrote: post #63

Earlier quoted context omitted.

It seems to be following a repeating pattern. * Bitcoin builds infrastructure. * People notice bitcoin isn't going away * Media says Bitcoin will make everyone Gazillionairres * Bitcoin skyrockets until infrastructure comes under strain. * Something involved with bitcoin breaks * Media(not neccisarrily the same media) says Bitcoin is all over, and everybody will lose their bitoin, their home, and their dog. * Price d…

> * Bitcoin skyrockets until infrastructure comes under strain. Source? Unless you consider the failure of Mt. Gox an "infrastructure" problem, then this is not the case.

It's hard to see how that wasn't an "infrastructure" problem. Mt Gox was the largest BTC exchange - an integral bridge from old world to BTC world.
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