Tried to send bitcoin yesterday ($120) to an online retailer, the fee was $31.50 which I did not have. So I went to buy more bitcoin and realized it would cost additional $31.50 to transfer the new bitcoins just to cover the other network fees. Had to do it, then for whatever reason my account was put on 72 hour hold. So I just gave up, literally out $200 with nothing to show. Bitcoin is a complete joke if you can't actually use it.

I would've thought having to pay a $31 txn fee on a $100 purchase would've been enough to dissuade you.

If it's a product he really wants and is only available via bitcoin payment, it could well be worth it.

I've paid $30 shipping for a < $100 item before when I really needed it to be delivered on time, so I can see paying a $30 surcharge to purchase an item.

Sounds like shilling for Bitcoin. Even if we all sometimes pay exorbitant amounts for priority shipping, doesn't mean we want to do that and get _no reward_ because "Bitcoin." The fees on Bitcoin currently make it practically unusable. If you want to argue for edge cases, go ahead. But please don't try to give these edge cases any mediocrum of regularity and sensibility...

It seems like common sense, not shilling: if what you're buying is only available with Bitcoin, then you get more of a reward than when you pay for expensive shipping -- if you don't pay whatever the transaction fees end up being, then you won't get the product at all.

You don't get a reward when you buy something - you get your purchased goods. The mental yoga necessary to consider a purchased good as a reward is absolutely baffling.

there are barely products for sale with bitcoin much less bitcoin exclusive products. only things i can think of are ransoms and drugs. i'm sure there are others but this isn't super common.

Sure, it may not be common, but still, my point stands.

If you're buying some uncommon product that's only available with bitcoin, then paying a 30% transaction fee might be worth it versus not being able to purchase the product at all.

uh sure your point stands. pretty weak point? in obscure circumstances it might be worth performing the unappetizing act of paying bitcoin transaction fees to buy something.

Doesn't that use Monero or something, I don't know, not a big black market cryptocurrency drug connoisseur.

You can set your own fees. I paid $3 for a transaction today (but it obviously still hasn't verified, and I don't know when it will). That's kind of the tradeoff, unfortunately.

These days, I find Bitcoin completely unsuitable for sending money. I use Bitcoin Cash, which verifies in ten minutes for something like one cent of fees (first block), but I guess that's because nobody uses it. Still, Bitcoin itself is out of the question for me personally, I'm not paying $30 for a transaction for anything.

Bitcoin cash doesn’t have artificially low constraints on capacity. 10 years ago, it was 1MB.

Despite all the advancements of storage and networking, it’s still essentially 1MB to a maximum of 1.8MB if everyone implements a complicated and costly to develop system called SegWit, and to fully use SegWit you have to use backwards incompatible addresses.

Bitcoin Cash has enough space in it's blocks to cover all of Bitcoin's and Bitcoin Cash' transactions.... for now.

Your $3 Bitcoin transaction might get cancelled before it gets written to the blockchain...

I had a similar fee when I tried to send a friend $30 of BTC to a paper wallet for Christmas. Ended up just walking him through setting up a Coinbase account and gave him $30 cash and he just link his own credit card (although he was never able to get past the pending account verification)

That's why you should use bitcoin cash instead. Cost me 1 penny to send any amount. I get confirmation within first block too.

Depends on the use-case. Definitely not useful for small transactions but $6-20 is still relatively cheap compared to other options for sending funds in cases where both parties do not have USD (or similar) bank accounts.

As far as store-of-wealth it has a different risk profile than both fiat currencies & physical stores like gold: more independent of government monetary policy, possibly harder to take by force, possibly more plausible-deniability, more liquid and lower txn-cost than gold, more volatile than both. That risk-profile is not perfect but is clearly useful to some.

Finally there's the value that it can provide as the trusted base for other off-chain solutions (like lightning-network).

Think about it another way - the market cap of bitcoin is now $274,103,408,466. A 10E-11 fee ratio is outstanding and all you need to get it down to. Bitcoin has become more of a large balance settlement layer and smaller channels are emerging on top of it.

The market cap of the USD is $10.5T, and I can send money for $3 to another person (with my middling BOA account) which is around a 10E-14 ratio.

So in other words, all those Bitcoin cheerleaders mocking Western Union, the traditional banks for their excessive fees... Bitcoin is 1,000 times as expensive? And this is a selling point?

I've never heard of fee ratios in economics or finance - this sounds more like one of these things that people 'create' to justify things... "oh, it's an outstanding fee ratio!".

But you can only have the fdic insurance limit in your boa account before the solvency of boa becomes an issue - also doesn't your boa transfer take a few days to clear?

You can purchase additional insurance, much as Bitcoin exchanges with insurance will also charge higher fees, because they're not getting that insurance for free (indeed, probably substantially more expensive per "dollar", because of things like poor/poorer security, etc.).

And yes, it does. Much like a transaction on the blockchain might if you paid only $3 in mining fees. Or you could pay $30-50 and get it cleared much more quickly, just as I could pay for a wire transfer and get things done in n hour or two.

How is the fdic insurance limit a disadvantage? Is there someone currently that will insure your bitcoins deposited with them?

I could buy insurance on my bitcoins - i'm not required to hope for a single institution however on a bitcoin - it's decentralized (fdic insurance isn't free, ultimately it's funded by taxes)

I vaguely think (not being in the insurance industry) that in order to be efficient, or even viable at all, insurers have to have some control over what they underwrite, which in turn requires knowledge about it.

Does it make sense that someone would be willing or able to quantify the risk of my losing a bitcoin deposit held by a third party? Is there someone selling such insurance now?

The FDIC has some ability to control and regulate the banks that it insures, including dealing with a failed bank. If somebody random claims to provide insurance, it doesn't inherently imply they have the same powers/information.

I think coinbase has insurance

Edit - https://support.coinbase.com/customer/portal/articles/166237...

That is interesting. I read: "Even if Coinbase were to become insolvent, the funds held in the custodial bank accounts could not be claimed by Coinbase or its creditors. The funds held in those accounts would be returnable to Coinbase’s customers."

Which sounds like what I would want to hear as a customer. However in context, that refers specifically to "fiat currency" only. So I would have to assume that whatever the insurance does, it doesn't protect me in the same way with respect to digital currency...?

Of course, I have never been in a situation where SIPC insurance mattered, so I don't have that to compare to.

But the level of risk here is not clear to me, and the language suggests it could be different from what I think of as normal.

I think the fair market value of the coins in USD are insured, not the actual crypto currency / bitcoins. Much like insuring a ring - the insurance company doesn't stock pile rings. They pay out cash upon a claim.