Quote from: Mattius459 on January 07, 2014, 08:41:26 AM

Beats in what way? It looks like volume-wise CC wins. The usage vs revenue only points to the fact that BTC users are spending more per purchase, not that BTC is inherently more efficient mode of transaction. Is this correct?

[anger removed]

Asking for genuine responses please.

In the offhand chance you are absolutely sincere and I've jumped the gun this is the internet after all, no body language and spoken tone I'll dance for a minute or two. Such venomous defensiveness reenforces my suspicions, just so you know...

Quote from: Mattius459 on January 07, 2014, 07:16:55 AM

Thanks for the responses. So we all agree that merchants will have to incentivize people to use BTC then? Not as sweet of a deal as it originally sounded for merchants, but overall it appears as though they can still save a percentage point or two overall. So far...

Consider this:

Bloomberg ran an interesting article the other day that pointed to the fact that the BTC network pays for itself by releasing a constant supply of coins into the market (to miners) which acts to constantly drive the price of BTC down.

No, this is how you bootstrap a currency without concentrating all the wealth in a few hands. Had we done that, we'd be genuinely open to ponzi criticism much more than now, like NXT and other premined coins are. Proof-of-work secures the system against counterfeit and the Byzantine Generals problem. This is one of the most basic tenets of the theory, which is part of my trouble taking you seriously.

As I said, don't listen to Bloomberg any more than you would accept Fox as completely independent for politics. I am pretty sure they are using Bitcoin to get rich themselves their mistranslation of the China events directly caused the severity of the crash we saw. Now, Bitcoin US is blaming Chinese investors for crashing the market, and the Chinese are blaming the West for being irrational and hurting their investments. Nicely done, all around.

Quote

This amounts to approximately 3.9% at current volumes. ** This percentage will surely go down with an increase in volume and decrease in inflation over time, but still in my opinion, AT BEST it will be 1.5% over the next eight years or so.

http://www.bloomberg.com/news/2014-01-02/bitcoin-is-an-expensive-way-to-pay-for-stuff.html

And the inflation and printing rate of the USD, for example, is...? Well, inflation is targeted at 3%, and our inflation-corrected GDP rate of increase has dropped to below 1% (because productivity has tanked). So, the USD is at the very least as bad off. Except Bitcoin is mathematically predictable and transparent.

Quote

So we have we have 1% deposit fee onto the consumer,

That's not a deposit fee. It's akin to a Forex exchange fee. Since the market has been rising for years, 1% is debatable as it depends on your timescale. In any case it is exactly like any other market: there is a gap between bids and asks. The market cannot function otherwise. You can do better than 1% if you look. I don't mask the bid/ask spread with a fee. The fee is built into the bud/ask. If you look at it that way, as you should and I wish CB would, the bid/ask is not, say, $916 / $924 with 1% fee each way. The bid / ask is $907 / $933. This isn't bad, either. Gold doesn't vary as much and it has a spread of 2x that in most consumer markets.

Quote

and 2-3% onto the merchant as an "incentive fee" in order to compete with CC companies.

No, the CCs are doing that as an incentive. You are right that BTC would need to be able to match existing incentives, and it can, and can exceed them. This figure cannot be included as a CC benefit calculation because it is already a cost that is getting passed back to the merchant... Which, yes, must then be paid for by consumers. It's just a shell game, and one which apparently works very well.

Quote

This averages out to 1.5-2% sum fee to both parties collectively. Put this on top of the 1.5(ideal)-3.9%(actual) fee exacted upon the markets by the maintenace of the BTC network, and we have a total of 3-5.9% overall cost to do business in BTC.

Getting expensive.

Would love to hear any and all responses. Thanks for your time.

Now that we disproved all those, can we move on?

Quote

** You can calculate this fee by taking daily bitcoins released (3600) and dividing it by the total daily volume in BTC. See this chart:
https://blockchain.info/charts/cost-per-transaction-percent

Can someone address this post please? I have no problem being wrong, in fact I would love it, but it looks to me like BTC is expensive to use.

FYI those figures are well-known to be overstated because miners don't use equipment they calculate for. Blockchain should update for the efficiency of ASICs, yes. Also, somewhere around here there is an excellent post breaking down the cost of the fiat system -- printing, counterfeit management, human labor, physical transport, minting, mining of metals, etc etc. It was astronomical, in the US alone. Something like 10,000x more expensive for the value.