Quote from: Stephen Gornick on June 20, 2013, 07:41:00 AM

Bitcoin doesn't have to be useful in every situation for it to grow. If bitcoin were used just for online gambling, or just for remittance payments, or certain other specific uses, that would be enough. But since Bitcoin can serve all these plus more expect it to permeate other areas as well. But if your Nascar fan never knows of nor cares about Bitcoin a few years from now, that's not failure.

Yeah, I agree with that. It's a big analog scale rather than some kind of failure/success binary. Still, I'm mainly interested, personally, because I want to be part of something that goes big or goes home.

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But you as a consumer are paying for that. The difference is that when a merchant includes the cost of the payment card fee into the price, every customer pays the higher price regardless of payment method used. So currently, credit card customers are being subsidized by customers paying cash. But certain types of business that are considered high risk already pay a higher rate, and they will be among the first to have an incentive to accept bitcoin and pass along the savings to the customer.

Oh sure, I understand. As we sell digital goods, we're a high risk customer. We let people mail us cash though, and they pay the same as credit card customers do. It's standard for most merchants to absorb transaction fees, making them invisible to consumers.

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So when you pay for an airline ticket with credit card the fare is several percent higher than it should be. So if your ticket is $400 with credit card or the equivalent of $388 with Bitcoin, and it is a non-refundable ticket anyway, what payment method are you going to choose?

Depends. If it's with a huge company, I may well choose the $388 option, knowing that they respect and want my loyalty. If it's with someone smaller, I'd rather pay $400 and know I'm reasonably insured against being ripped-off.

I mean, look, the major reason I'm interested here is because of the situation you describe. The 2-3% that credit cards take every year is an absolutely gigantic market world-wide and bitcoin has an opportunity cut into part of that. I hate the credit card companies and their collusion. I think they charge more than they would if they weren't effectively colluding. I'm just not as optimistic as some of you are.

So then those that still choose to pay with credit card do so because they plan to use the customer protection -- thus the cost of fraud on a per-dollar basis rises and the merchant fees have to rise. It's a self-reinforcing trend. A larger share of the remaining credit card transactions will be fraudulent, allowing the cash/bitcoin discount to become larger, which pushes more of the non-fraudulent activity over to the cash/bitcoin method.

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Additionally, at the restaurant that has "Cash only", I don't get the option to say that I prefer credit card. If that's the only payment method they accept then that's how I pay. So when Nascar Bob wants tickets to a sold-out race and the seller only accepts Bitcoin payment, Bob will follow whatever instructions he needs to do to get his tickets. Today, those instructions could be as simple as: "go to seven eleven, pay the cashier exactly N.NN dollars for a Moneygram bill payment transaction". Boom. Done. Bob just made a purchase using Bitcoin and still doesn't have to know a thing about Bitcoin.

That already sounds too complicated for mainstream adoption on a regular basis, to me. If I have to go somewhere physical, that's a huge burden. The only reason I should have to go somewhere physical to buy something is if there is a physical thing there that I am physically picking up (groceries, etc).