I know people who pay their coffee in cash, leave a tip and don't even own a credit card. No need to keep a tab open and no need to pay any additional fees ¯\_(ツ)_/¯

I know people that also pay cash for two piece of gum at the gas station while clogging the line as the cashier counts out the change for a $100 bill. There are fees associated with handling cash. Banks don't store and transport cash for free and insurance companies don't insure cash losses for free. Why do some places either don't accept cash or put silly restrictions such as "Limit $20 Bills" They don't want to deal with the risks and costs of cash.

Sure there's cost associated with handling cash, just like there's cost associated with crypto currency and BTC in particular.

Just imagine how long the line in your gas station would be clogged up for if you had to wait for a BTC transaction to be confirmed...

The difference is that while you are hit with arbitrary fees when dealing with crypto (be that transaction fees on the BC or fees by intermediaries and services in case of Lightning), cash related costs are already priced into the product and can be planned for from business's point of view.

I guess you should be reminded that lightning does not require intermediaries, and informed that the fees associated with long term operation of a lightning channel are negligible. Even in the case of premature settlement due to counter-party attacks you are paid out the full channel balance and therefore almost always profit in such a scenario - opening a channel with less counter-party collateral then an on chain fee is simply avoided to enable profit or recuperation every time.

Are merchants and businesses that accept cryptocurrency payments converting to US currency immediately or do they hold and convert at the opportune time whether that time is related to market values, exchange rates, tax/accounting purposes?

Other than securing the wallet, there's no carrying costs for whatever amount of cryptocurrency a merchant holds? It's not as if you don't hold a minimum amount in your business account, the bank levies fees since you deposit money so they can lend it back out and charge borrowers 10x as much.

So you are saying that the business doesn't convert BTC to USD near immediately? Seems like a lot of currency risk here.

I am only a home owner because the value of my deflationary BTC savings dramatically outpaced inflationary USD savings account interest.

If bitcoin is coming in constantly you get it at the average price via dollar cost averaging and the average value of Bitcoin has trended sharply up for a decade.

Selling BTC for USD is most likely a loss to inflation if you intend on holding for a year or more.

You gambled your money against other people. You won, and they lost. Their losses paid for your house.

12m y/y bitcoin is up 8% and the S&P is up 18%, so if you gambled your money into bitcoin a year ago, you made a bad choice. Note that last week bitcoin was down 5% y/y. Bitcoin, y/y is hardly beating USD inflation, right now, after a major increase in the price today.

Also, stop comparing a speculative asset to a currency. USD isn't meant to be held as an investment. It's meant to be spent, or invested in an asset that appreciates more than inflation.

Lightning is worse than that. When you do try to convert from BTC to USD, you pay a transaction fee twice. Once to close the channel, and another to transfer to the party where you want to exchange your BTC.

And further, you can't predict the fee you'll pay. And I hope you aren't in a hurry to settle in those cases.

As Lightning grows so will USD to Lightning custodial services. I’d be surprised if there weren’t any you could use right this minute, actually.

I'm not really sure how that changes anything I said. You're naïve if you think the service isn't going to pass those costs onto their users.

And if you need to resort to a custodial service, what are you even using BTC for? Using a custodian to give you permission to enter and exit a market is antithetical to everything Bitcoin stands for and exactly what it was created to fix.