Quote from: Giraffe.BTC on November 04, 2011, 09:36:45 PM

Quote from: MoonShadow on November 04, 2011, 08:51:55 PM

As the the question, "what do you think will motivate a consumer to use an irreversible method like Bitcoins to buy something online instead of their Visa card?" the answer is very simple. Lower transaction fees over the Internet, and eventually merchant discounts. Once upon a time, cash was cheaper than using a credit card, until the credit card companies got wise and started demanding vendors sign contracts to not advertise prices lower than the credit card prices. This is why the dual price displays on gas pumps disappeared in the 1980's. But you can still get a cash discount from such vendors on larger items, such as a new tv, if you know who it is in the store you have to talk to.

So you think a possible savings of 1-2% will be enough to make most consumers willing to forego the fraud protections and grievance procedure that come with their credit cards?

For most, no. The credit cards also have the advantage that consumers are used to the system, and thus demand that system from vendors. Which is why vendors use credit cards despite hating them. But Bitcoin doesn't need most, only some. As it chips away at the online market share of PayPal and Visa, it will become ever less obscure to the common consumer, and savvy vendors are going to start offering discounts for bitcoin. Success need not be defined by the destruction of credit card companies, and likely couldn't anyway. The advantages of credit cards could literally be added to bitcoin by those same credit card companies, if they so choose.

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Won't scammers take advantage of this and set up online Bitcoin shops that advertise lower prices without ever actually delivering anything?

Some will try, undoutedly. But try to undercut Walmart.com without a high level of trust from an established customer base.

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I'm no expert in economics, but as a consumer I can tell you that I value the peace of mind that comes with using my credit card for online shopping far more than a tiny potential discount.

Why? Do you send your CC data to vendors online that you wouldn't trust to deliver on their promise? If so, why would you trust them with your CC data? There is more criminal profit to be had from selling or using the list of customers' data than from taking your bitcoin purchause and never sending you anything. This is also why Ebay has vendor feedback, because you can still be screwed by a trickster. Keep extending your trust online when it's unwarranted, and eventually you are going to have a real consequence. Perhaps you are always protected by your CC company, but if you're gulible enough, eventually they will drop you like any other insurance company.

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For Bitcoin to have a chance at becoming a currency, this issue can't be shrugged away: the case will have to be made that one won't lose their money if they buy from what turns out to be an unscrupulous vendor or no one is going to use it.

Bitcoin is already a currency, what you ask for is a complete banking structure. That will come, eventually, to whatever extent the market may demand. As I mentioned, there is literally noting stopping Visa form issuing Bitcoin credit.

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Online vendors, for the most part, don't sign such agreements; and even if they did, they could be undercut by another website selling the exact same products for bitcoin only.

This sounds like something you completely made up. Do you have any evidence that online vendors aren't under contractual agreement with the credit card companies to not offer discounted prices on other forms of payment?

Not that I will present, but I'm sure that you could find enough for yourself if you thought about it for a minute.