Quote from: FlappySocks on December 18, 2013, 11:05:38 PM

What about retailers? UK retailers have to put up with high credit card fees. Card payment is very popular in the UK. Germans don't seem to use cards much. Not sure about elsewhere.

I didn't know the UK had many credit card users. I'm used to Germany, Belgium and the Netherlands, and most people get by without any credit card at all.

It's true though that a lot of retail merchant fees on their payment gateways are excessive, especially things like credit cards and PayPal, and especially in the US. In the Netherlands we have a somewhat cheaper alternative called iDeal, around 30 to 60 cents per transaction depending on what bank you pick. Bitcoin is certainly cheaper than PayPal, but you have to take into account other costs as well. Bitcoin needs a payment system like BitPay because you can't allow yourself as a merchant to have funds that are incredibly volatile and change 10-20% in value daily. BitPay asks 1% for their transactions, or a monthly fee, which is still pretty competitive, but not so much in countries where credit cards aren't widely used.

Also, Bitcoin isn't as cheap as it used to be. Heck I made some charts recently and wrote an article analysing Bitcoin transaction fees so I might as well expand on that a bit.

The black line shows the average Daily Bitcoin transaction fee per transaction in US Dollars, calculated on the basis of blockchain.info data. The second chart shows a close-up of this year:
http://i.imgur.com/Qst9HLT.jpg
http://i.imgur.com/VGbXzu1.jpg

Basically, this year miner fees went from $0.01 to, on average in December, $0.27 cents. Now that Bitcoin prices are dropping, I'm expecting miner fees to also fall. This is, actually, a good thing for Bitcoin as a payment system, because had prices kept going up, miner fees would've most likely gone up as well.

It's difficult to say though whether miner fees are more dependent on transaction size rather than Bitcoin price or vice versa. When someone pointed that out I made a chart looking at average transaction size, price, as well as average daily fee per transaction: http://i.imgur.com/ot98Uz5.jpg

It looks like transaction size is more important than bitcoin price for the average transaction fee, but I'd need to have a look at more minute data to see whether fees of small transactions, say $1, have also had to deal with rising transaction fees. They might not have gone from $0.01 to $0.27, but a rise from 1 cent to 10 cents on a dollar is relatively already quite a hike. That's a lot of detailed work on blockchain data though so I'm procrastinating on it. Also, that work becomes redundant when Bitcoin falls in price and miner fees drop again anyway

Edit: Also, I realise I really need to check who pays the miner fee in BitPay transactions. Does BitPay take on that fee? The merchant? The customer? I couldn't find anything about it on the net and I really don't like not knowing things when I research stuff.