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Stripe: Bitcoin

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Re: Stripe: Bitcoin

#171
post #160

Earlier quoted context omitted.

how would that $1 be destroyed?

A better or more accurate example I realize would be pointing out that if the US government prints money then the overall value per unit of the of the currency goes down. Bitcoin is mined which is akin to printing money. I'm not sure I am using the correct terminology, though trying to better articulate. Currency gets destroyed buy governments. They say take $1 million of cash and burn it/remove it from circulation.

i think you dont understand bitcoin or money at all. that is not meant to be dismissive, i think a lot of people dont understand how money creation actually works, just that it does. for some reason people think bitcoin is so strange that they could not use it but if they stopped to think about how fiat currencies work they would be equally confused.

so the first thing you say, about the US government printing money and the existing money becoming worth less, this is known as inflation.

Yes mining bitcoin is similar to printing money, however you cannot 'print' bitcoin infinitely as you can with US dollars. This is why bitcoin is known as a deflationary currency and many people think this is a negative aspect to its adoption, but if there was no artificial scarcity i.e you could make as many bitcoins as you wanted when you wanted then there would be no value to them whatsoever.

>currency gets destroyed buy (sic) governments Do you mean by inflation or do you mean they are putting it all in a furnace somewhere?

They destroy old used notes yes, but that doesnt take it out of circulation. if they burn $100million then they have $100million in fresh notes to go back out into circulation. That money comes from banks, those banks are holding it as deposits for customers. If the government 'destroyed' it then those people would not have any money in their bank accounts.

Far from destroying money or removing it from circulation many governments have been printing money like nobodys business over the last half a decade. Google Quantitive Easing to see the offical description of it and what they hope to achieve as a result.

Re: Stripe: Bitcoin

#172

Earlier quoted context omitted.

What you said is 100% correct, which is why companies accepting bitcoin need to give the entire ~2-3% discount to customers. Very few credit cards will match 2-3% rewards, and from the sellers perspective bitcoin is better than credit cards payments. To name a few benefits: - There are no chargebacks - Funds are available immediately (though transferring from BTC to USD may take a day) - You can accept payment from a…

Is it legal to pass the discount onto customers? The only businesses I've seen giving a discount for paying in cash are (some) gas stations.

IIRC, it is now. There was a lawsuit about that in I think 2011 where merchants settled with credit card companies and payment processors that they are allowed to charge less for cash transactions. That had previously been prohibited, which was circumvented to a degree by the pervasive "minimum purchase" sign.

I'm pressed for time at the moment, so I can't provide a link.

Re: Stripe: Bitcoin

#173

Earlier quoted context omitted.

The problem with this is that, from the buyer's perspective, the price is almost always the same when using a credit card or alternative. And with a credit card, the buyer gets rewards back, typically 1% or so. So, sadly, using a credit card continues to have more protections, costs less, and has deferred payment. I don't think this is a good thing, just saying. I hold some bitcoins, but I never buy anything with the…

What you said is 100% correct, which is why companies accepting bitcoin need to give the entire ~2-3% discount to customers. Very few credit cards will match 2-3% rewards, and from the sellers perspective bitcoin is better than credit cards payments. To name a few benefits: - There are no chargebacks - Funds are available immediately (though transferring from BTC to USD may take a day) - You can accept payment from a…

- There are no chargebacks

This is a huge negative for the customer, though

Re: Stripe: Bitcoin

#174
post #161

Earlier quoted context omitted.

> The problem with Bitcoin though is it isn't a currency. You mean it isn't a fiat currency. All that means is that Bitcoin's value isn't backed by a government, but is instead derived purely from the ability for someone to spend it. > If it was a currency, if $1 USD was paid for a Bitcoin, that USD would be destroyed, not pocketed. What? Since when? If you spend USD to buy EUR, the person on the other side of the tr…

Bitcoin still doesn't fit the definition of currency on its own. The fact that Bitcoin has a value is more because of speculation. People early on mined it and therefore own larger amounts for relatively little effort or cost. Now it's worth more and they have reason to perpetuate its growth. Investors now have joined gamble and speculating by putting in $100s of millions of real cash in hopes they can help stabilize…

Lots of places take Bitcoin as a method of payment--therefore, it's a currency. Sure, its exchange rate is volatile due to speculation, and its future is relatively unknown right now, but that doesn't mean it's not a currency at all. Bitcoin has real value as a form of digital cash, and lots of people are using it that way.

> Bitcoin's value is mostly dependant on demand, which is being pumped up and perpetuated by investors and those with vested interest in the ecosystem including those who own Bitcoin and larger amounts of Bitcoin - who all want the value to go up 10x - 100x.

You're absolutely right: since Bitcoins aren't backed by anything real, their value is purely based on demand. But I disagree with the notion that speculation is the only reason they have any demand. Plenty of people are using Bitcoin in the real world, e.g. to make purchases anonymously or to easily send money overseas.

Re: Stripe: Bitcoin

#175

Earlier quoted context omitted.

> should I buy bitcoins with my dollars when I can just pay with my dollars directly? Cheaper fees (0.5% vs 2.9%) can be potentially passed on to consumers. And anonymity.

bitcoin's not really that anonymous. Sure, the ledger doesn't contain identities, but it's not extremely difficult for the mapping between addresses and identities to "leak" and once they do, it's anything but anonymous.

there is no mapping to leak, there is no join between your identity and the bitcoin ledger, there may be some sites such as coinbase that can say "well coins were sent from this address controlled by Mr. Bob, to a new address". Mr. Bob says he sent it to a gambling website, exchange, merchant, localbitcoin sale, in person trade etc. After that he has no idea where it has gone or no way to link the identity of the current owner of those bitcoins, add in 3 or 4 more steps and it doesnt become difficult to obfuscate the trail enough that there is no conclusive link.

that says nothing for coins mined directly, wjere there is no link to any real world identity held anywhere, just a bitcoin payment address.

Re: Stripe: Bitcoin

#176

Earlier quoted context omitted.

What you said is 100% correct, which is why companies accepting bitcoin need to give the entire ~2-3% discount to customers. Very few credit cards will match 2-3% rewards, and from the sellers perspective bitcoin is better than credit cards payments. To name a few benefits: - There are no chargebacks - Funds are available immediately (though transferring from BTC to USD may take a day) - You can accept payment from a…

Is it legal to pass the discount onto customers? The only businesses I've seen giving a discount for paying in cash are (some) gas stations.

"pass the discount"

You can say "if you are dressed like a clown today we will give you a 10% discount". Point being that there is nothing to prevent you from giving someone a discount as long as it doesn't break any laws and as long as you are offering it to everyone that falls into the same category (or the discount has been negotiated).

Re: Stripe: Bitcoin

#177

Earlier quoted context omitted.

What you said is 100% correct, which is why companies accepting bitcoin need to give the entire ~2-3% discount to customers. Very few credit cards will match 2-3% rewards, and from the sellers perspective bitcoin is better than credit cards payments. To name a few benefits: - There are no chargebacks - Funds are available immediately (though transferring from BTC to USD may take a day) - You can accept payment from a…

Is it legal to pass the discount onto customers? The only businesses I've seen giving a discount for paying in cash are (some) gas stations.

Yes it is legal:

"Beginning January 27, 2013, merchants in the United States and U.S. Territories will be permitted to impose a surcharge on consumers when they use a credit card." http://usa.visa.com/personal/get-help/checkout-fees.jsp

Re: Stripe: Bitcoin

#178

The Bitcoin community might want to take a deep breath and recognize where Bitcoin has the most real-world use. The idea that my mom will someday use Bitcoin to buy books online is about as realistic as the belief that, any minute now, youngsters will realize that the daily newspaper is better read in paper form, because of the texture and experience and the anonymity of paper. For that matter, I am a computer progra…

i think it is most likely to be successful not as a consumer level product but at an infrastructure level. businesses will exploit the blockchain and end users will be using it without realising it, so moneygram and western union will use it to send money for you, you wont know, you will be sending euros, dollars, shekels, whatever but you benefit from lower transaction costs, say half of what WU currently charge but for WU they would be making more per transaction as a result of leveraging the blockchain and low cost bitcoin transactions.

Re: Stripe: Bitcoin

#179
post #93

Earlier quoted context omitted.

I disagree somwhat- We're slowly moving into a new economy where the distinction between buyers and sellers is blurring: Instead of everyone making their purchases from a few megacorp sellers, the future will be one where any person may have a small shop or sell a small product with a small unit price (maybe even your mom someday.) In that type of environment, it is helpful to have a payment system that is more "sell…

How is that creating a blur between buyers and sellers? We've always had small businesses and will continue to have both small businesses and large corporations. I don't understand the small unit price correlation to a small business. The 1-2% savings in processing fees right now are heavily offset by the instability of the currency. Not being able to plan your cost of goods sold and having predictable formulas for t…

You mean like the stability in the cost of things like food and gas?

Re: Stripe: Bitcoin

#180

Earlier quoted context omitted.

Is it legal to pass the discount onto customers? The only businesses I've seen giving a discount for paying in cash are (some) gas stations.

I assume it would depend on where you live but it is in the US.

Semantically if it's a surcharge for paying by CC it's illegal in several states, but not if it's stated as a discount for non-CC transactions.

http://www.ncsl.org/research/financial-services-and-commerce...

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