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.
* Checks / ACH takes days to close, plus in many situations you might have to actually mail the person a check
* EFT seems reliable, but takes days and requires having been previously set up and authenticated (which borders on impossible if you don't own both accounts).
* Wiring seems like the obvious solution, but depending on your combination of banks fees are going to be >1% for transactions of my size. I also failed to get a wire to happen in <24 hours online for reasons I still don't understand.
* Using a money sending service like Google Pay sounds reasonable enough, but even assuming you're under the transaction limit and have already set up everything necessary to satisfy their fraud prevention systems, any large amount will still take multiple days to fully clear.
On the other hand, while Bitcoin's slow transaction times are a pain for in-person merchant payments, being able to send even large sums of money reliably in less than an hour for (comparatively) a small fee seems almost miraculous. It's true that if you need to go USD -> BTC -> USD it takes much longer, but that's more a problem with currency exchange than an inherent limitation of the currency itself.
I fail to see how Bitcoin could have helped any of this.
I get that some banks might not be as competent yet, but signs look like they'll all get there in the end.
> I fail to see how Bitcoin could have helped any of this.
how about:
- not having to pay $25 (btc fee of $0.03 is confirming within an hour, $0.10 is almost guaranted to confirm in 10m)
- "frozen account" is not even a thing
- not having to speak to anyone on the phone
you must be joking.
And then my transaction clears in 10-20 minutes instead of a day or two like the banks' ACH network.
For 10 cents they do it in under 10 seconds.
SEPA Inst is a thing now.
The reason why bitcoin doesn't have these features is that there isn't a bank sitting between the two parties doing business. To exchange a bitcoin with somebody, you are essentially trading "in cash". When you do business with somebody directly in cash, the same kind of shortcomings are involved, especially when it's not a transaction with a vendor that has a policy that allows you to return and refund the products you bought using cash when you can provide the receipt.
In fact once you lose the receipt, in most places, if they allows you to return the items you bought, they won't give you back your cash. Rather they will give you the ability to exchange what you returned for something of equal value within the store. They still get to keep the cash you gave them in that scenario.
When it comes to being able to dispute charges on a debit/credit transaction, like I said before, that is only because there is a middle man bank that is holding the funds in escrow. While I am not up to date on the way things are currently regulated with regards to bitcoin, there is nothing technologically getting in the way of somebody being able to build a banking/brokerage type system around bitcoin exchange if they wanted such guarantees.
The reason why bitcoin doesn't have these features is that there isn't a bank sitting between the two parties doing business
So, it sounds like it only works if nobody uses it.
Sure, you can say we now have <insert name here> which is like Bitcoin, but solves this problem. This, however, is similar to pointing out there are credit cards with lower fees than what you mentioned (e.g. national ones), it's just the major ones that are expensive.
It's extremely americanocentric to assume All Of The World either uses credit cards or x-gen Kriegerands.
Bitcoin is orders of magnitude better money than anything else in every aspect except convenience, but it’s getting there.
Whether you want to believe it or not, enough people are not having their money "stolen", "without their knowledge" in the real world that anything you said after that would make sense to them. In fact, you gloss over how the one thing everyone fears in crypto is - having their money taken away without their knowledge!
I mean hot storage, cold storage, private keys, public keys... your online trading company being hacked... Do you honestly think that anything in crypto is safer or 10X better or easier than a regular bank that everyone in America or the modern western world, has access to?
It's rather disingenuous to say that people having money stolen from them isn't a problem when you have a system that cyclically chucks out an Enron or Sub-Prime mortgage crisis every ten years or so that typically ends up getting resolved on the taxpayer's dime.
The definition of insanity is doing the same thing over and over again and expecting a different result. If you're going to downvote someone, prove them wrong. Ad hominem let's you nowhere.
Also, you are right on Bitcoin though. It has a higher chance of someone just taking your the ball and going home, something any nationally backed currency has measures in place to prevent.
Bitcoin if anything exacerbates the "poof' likelihood of value.
You mean like MT. Gox?
Because people are still losing tons of money over Bitcoin.
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.
The fact is, if you were once super rich in Venezuela and you had all your wealth in stacks of Venezuelan money, now you are no longer rich.
Which is why most rich people in other countries like to exchange their tangible money for other nation's currency. Because in the event that their country's economy goes belly up then at least not all of their money has become worthless.
The problem is that not everybody might be willing to exchange your country's currency for theirs. Which is why the US dollar is the international standard for currency exchange.
The big problem the designer of bitcoin saw is the fact that when one country has the ability to make money that everybody wants, we end up in a situation where that country has an unfair advantage to strong arm other nations into a mode of compliance. Like all the US has to do is say that nobody from the US is allowed to exchange their money for Venezuela's money, nor are they allowed to exchange their money for somebody else's money when said person has a history of exchanging currency with Venezuela.
The fact that a few countries can get away with such behavior, means in the end that countries are placed into an economic ladder and nobody is allowed to take a step up if that comes at the expense of somebody higher up on the rung having to take a step down.
In other words, the US has become a monopoly on all other countries when our dollar is in the middle of international trade.
Bitcoin in theory is supposed to replace the dollar role in this sense where no one nation gains the ability to strong arm other nations into behaving in a way that might be contrary to their best interest.
That Bitcoin is used for shady stuff and is harder to track is a red herring for all 10 years of its existence. Come back when Bitcoin’s usage for said stuff is within order of magnitude of USD’s market share.
Those are products you’re paying for. Similar products (and much more flexible/advanced) can be built for bitcoin.
Bitcoin also has risks; it could also collapse, have security vulnerabilities, you could lose access to your keys or if you choose to use an exchange it could be compromised or seized by authorities.
Now, it is true that the risks are different than for other currencies, but you can’t just act like bitcoin doesn’t have risks or that they are a priori less risky than other currencies.
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.
p2p channel payments is only limited by network bandwidth and cpu power between participants. routed channel payments are limited by routing network connectivity and capacity, which is not amazing yet but far better than 7tps.
The main problem is to believe that Bitcoin will be the solution for markets that have their banking system and governments functioning perfectly.
The reality is that most of the world does not have this efficiency found in the US and Europe. Opening a bank account is not a trivial task in every corner of the world. Acquiring a loan, importing or exporting a product, sending values to a person, organization or company in another country. All these activities are extremely difficult to do for more than 80% of the world's population.
Not being centralized is an advantage that entails enormous difficulties. But none of them kills the initial purpose.
Here are some reasons why cryptocurrencies is a superior payment system, even for the consumer:
* The fees are lower (VISA and PayPal fees are priced into the cost, and they are much higher)
* It's anonymous (see Monero for example)
* You can send money easily to anywhere in the world (lookup EatBCH which is a charity providing food in Venezuela)
* You don't need a bank's permission. There are many unbanked people in the world.
Here are some reasons why it's a superior payment system for the merchant:
* Eliminates credit charge back fraud, which is a very big problem
* The fees are lower, especially important for low margin businesses
* Nobody can freeze your accounts, like PayPal has done on numerous occasions
* Any business can accept money digitally, for example porn sites and marijuana businesses have had a lot of problems accepting credit cards
A permissionless and trustless digital payment system has so obvious benefits I really wonder why people have trouble seeing them.
Is it ready yet? No. Are there problems? Yes. But the benefits are there.
* You don't need a bank's permission. There are many unbanked people in the world.
Do we imagine those unbanked people being likely to have bitcoin wallets?
* Eliminates credit charge back fraud, which is a very big problem
That a problem, for sure, but in exchange consumers have no recourse if they legitimately need to chargeback a vendor. This is an anti-consumer feature of bitcoin.
* Nobody can freeze your accounts, like PayPal has done on numerous occasions
Unless you can somehow always keep your money in bitcoin until you exchange it for goods and services, you'll need an exchange to your currency of choice, at which point governments have all the ability in the world to effectively freeze your assets.
* Any business can accept money digitally, for example porn sites and marijuana businesses have had a lot of problems accepting credit cards
There isn't any technical reason that websites can't accept bitcoin today, and yet the number of websites that are offering bitcoin payments is shrinking, for well discussed reasons. I feel it's fair to say that that business have had more (and different) problems accepting bitcoins.
Yes, mobile phones far outnumber bank accounts in much of the developing world.
Also unbanked people exist in the developed countries. Ex convicts, immigrants and homeless for example.
> That a problem, for sure, but in exchange consumers have no recourse if they legitimately need to chargeback a vendor. This is an anti-consumer feature of bitcoin.
Yes it's one of the drawbacks.
You could argue that it's easier to have recourse against a business than against an individual.
> you'll need an exchange to your currency of choice, at which point governments have all the ability in the world to effectively freeze your assets.
You're imagining a world-wide all powerful and all knowing government which can freeze your funds. There are exchanges all over the world and you can even sell your coins for physical cash. Also you need to be able to trace all coins and then try to freeze them, which isn't practical if you use Monero or a good mixing service.
That's assuming you actually sell your coins for fiat instead of buying things or services instead. Or if you just hold the coins.
This is very different from holding the actual wallet and being able to freeze it at any time.
> yet the number of websites that are offering bitcoin payments is shrinking
Do you have any source that the number of porn websites are accepting cryptocurrencies less?
Cause that doesn't seem to be the case at all. Pornhub for example has partnered with other cryptocurrencies (bad move IMO but still). Playboy was working on it but apparently got screwed by their contractor. There are other smaller sites that have begun accepting cryptocurrencies recently.
This is also not a technical argument against cryptocurrencies. With time adoption will increase since the technology is here.
Not a surprise commerce will turn to other coins, including BCH
* 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.