Quote from: CIYAM on October 05, 2015, 12:38:39 PM

Quote from: Quickseller on October 05, 2015, 06:26:53 AM

If CPFP were more widely used then a merchant could receive a zero fee transaction from it's customer and then spend outputs from that transaction and include a sufficiently high tx fee so that both tx's get confirmed then the cost of receiving a BTC payment would essentially be absorbed by the merchant, which is the statuesque for Credit Card payments.

Whilst this may indeed be possible it is something that is not being really used at the moment and I think it will require specialised software to do this which basically means that merchants are still going to use payment processors rather than just say a Bitcoin client (personally I think that we don't want to even have payment processors in the future).

Merchants use specialized software to process cash transactions today (although these specialized software is also capable of processing credit card transactions). Large corporations will often use their own custom software to process all their transactions. Granted, if you are a mom-and-pop small business who only accepts cash then you may use nothing more then a 10-digit calculator to process transactions/give change.

If you were to attend a Carolina Panthers football game, and purchase a beer with your credit card, then the process would likely be as follows:
Card gets swiped at Point-of-sale terminal (uses custom software) --> encrypted card data along with transaction data gets sent to back office server (uses the same custom software) --> encrypted card/transaction data gets sent to 3rd party "merchant services" company (payment processor) --> merchant services company sends transaction to Visa network --> Visa network sends transaction to issuing bank for approval --> transaction is approved and approval message takes reverse path

If you were to pay with bitcoin with the merchant using CPFP:
POS terminal (with custom software) will query the back office server for a one-time payment address --> back office server (using the same custom software) will provide a QR code with the address to send to --> POS terminal displays address for customer to send to, and customer broadcasts transaction to that address --> back office server sees transaction, checks for double spend attempts, rebroadcasts transaction, and broadcasts 2nd transaction with CPFP, and tells POS the transaction is "confirmed" (not to be confused with a Bitcoin confirmation).

The reason why merchants will use a payment processor is because their bills are in dollars, and there is nothing they can really do with their bitcoin except convert it to fiat. What needs to happen in order for merchants to not use payment processors is for the bitcoin economy to grow large enough so that merchants can pay their bills with the bitcoin they receive from sales.

Quote from: brg444 on October 05, 2015, 12:59:27 PM

Quote from: Quickseller on October 05, 2015, 06:26:53 AM

Benefit from an irreversible payment? Very little, however there are other benefits to the customer, primarily (current) low cost of use and the ability to send money instantly (yes, I would argue that bitcoin transactions are for all intensive purposes instant from the viewpoint of the customer, regardless of confirmation time)

Credit cards are costless to us and send money instantly as well. It's fairly obvious Bitcoin doesn't compete and certainly does not offer a superior product on these grounds.

Credit cards are not costless, the cost of using a credit card is not transparent to the consumer, but it is present. The cost to use a credit card is roughly 3% of the credit card volume, however this is somewhat subsidized by cash transactions (assuming that cash is free to process which it is not), so the actual cost to use a credit card is somewhat lower then 3%. The cost is reflected in higher prices imposed by merchants. As of fairly recently, merchants are allowed to have different prices for cash transactions then credit card transactions, however few merchants have done this because of the complexity. I suspect that it will not be a long time before the cost of using a credit card is more transparent to customers.