Bitcoin breaks $200

hehejo said:
I think what they are trying to say is that you can have your prices in usd and then just convert it for every transaction.

Not that it would make sense to integrate anyways, people are clinging to their BTC now and when it comes down you won't have anyone to sell it to if you are a vendor.
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I see what they're saying, but even if my prices are in USD on my site and the number of bitcoins for the transaction doesn't matter (which it does, but we'll continue), you can get still get really easily fucked here.

Imagine this scenario:

My product costs $10 USD, which is what is shown on my site. Someone pays me the equivalent price in Bitcoins at 9AM today. Tomorrow morning, I wake up to find that Bitcoin value has dropped by 50%.

I am now 50% poorer unless I immediately cashed out that Bitcoin to USD upon receiving that purchase. My margins just got fucked, my revenue just got fucked, I just got fucked.

Why, as a merchant, would I take that risk? If I have to constantly immediately cash out my coins, the coins are no different than arcade tokens.

What's happening here is that the only people really doing anything with Bitcoins right now are speculators riding a money train. Merchants aren't speculators, there's enough volatility when trying to sell a product, I don't want to be worrying that the money someone is paying me with can implode overnight.
 


dchuk said:
I see what they're saying, but even if my prices are in USD on my site and the number of bitcoins for the transaction doesn't matter (which it does, but we'll continue), you can get still get really easily fucked here.

Imagine this scenario:

My product costs $10 USD, which is what is shown on my site. Someone pays me the equivalent price in Bitcoins at 9AM today. Tomorrow morning, I wake up to find that Bitcoin value has dropped by 50%.

I am now 50% poorer unless I immediately cashed out that Bitcoin to USD upon receiving that purchase. My margins just got fucked, my revenue just got fucked, I just got fucked.

Why, as a merchant, would I take that risk? If I have to constantly immediately cash out my coins, the coins are no different than arcade tokens.

What's happening here is that the only people really doing anything with Bitcoins right now are speculators riding a money train. Merchants aren't speculators, there's enough volatility when trying to sell a product, I don't want to be worrying that the money someone is paying me with can implode overnight.
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I'll tell you why you'll take the risk.

You'll take the risk because you are doing something illegal.
 
dchuk said:
A merchant saving a 3% or so credit card transaction fee is kind of pointless if there's a risk of the value of the coins dropping 10%+ any given day (which is basically the flipside of the current boom in the pricing of the coins right now, so it's not outside the realm of possibility).

I wouldn't want to be running a SaaS where people sign up to it at a bitcoin price of say $200 and then when the next billing date comes around, bitcoins are valued at $100. I'd either have to charge them twice as much (which consumers aren't going to be cool with at all, variable automated pricing just isn't acceptable), or eat half the revenue.

Someone correct me if I'm wrong here, didn't get a lot of sleep last night...I think my logic is sound though.
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Bitcoin does not support automatic repeat billing. So for your SaaS service, its not going to make sense.
 
hehejo said:
I think what they are trying to say is that you can have your prices in usd and then just convert it for every transaction.

Not that it would make sense to integrate anyways, people are clinging to their BTC now and when it comes down you won't have anyone to sell it to if you are a vendor.
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If both sides are converting wouldn't it be easier to get ride of the middle man and just use USD?
 
Cripes, it just hit $277 CDN on a Canadian exchange.

You can't even do arbitrage at this velocity. By the time you transfer cash from one exchange to the other, your trading margin is gone.
 
dchuk said:
A merchant saving a 3% or so credit card transaction fee is kind of pointless if there's a risk of the value of the coins dropping 10%+ any given day (which is basically the flipside of the current boom in the pricing of the coins right now, so it's not outside the realm of possibility).
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Deep web sites (i.e. Silk Road and similar) have been using the pay USD in BC equivalent for years now. I get that they do this out of necessity, but it works well enough that they've been going for 2 years now. It takes their system a few minutes to update with fluctuations, but overall everyone is happy. Seems to me that the model has proven itself.
 
It won't be long before we have automatic gateways that will convert BTC to USD at time of purchase. It's a very trivial thing and would KILL credit card processing.


Bitcoins are SUPERIOR to current methods of processing, it will be a huge value to companies who take it. I just wish there were easier ways to integrate it.
 
Should you hit, should you stay? Hard to say when you can't count the cards. Only one thing's certain: the house WILL win.

Which is to say, I'd love to be mtgox right now.
 
productionhead said:
Bitcoin fanatics can convince themselves of anything, even to the point of contradiction.
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I'm not a fanatic, I just don't believe what I'm seeing.

I'm 40+ years old, I did the tech boom, the real estate boom and the oil shale boom. This is fucking unbelievable.
 
productionhead said:
Bitcoin fanatics can convince themselves of anything, even to the point of contradiction.
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I heard the same thing about paypal 7 years ago, now it's everywhere.


There is a major teething issue with getting developers to jump in. From a design standpoint it is easier to deal with than credit card storage/compliance issues. Lowers the cost of infrastructure.
 
What is happening is Price Discovery. Guys, this is brand new. 4 years out of the gate. If this has legs (Which I hope it does) whole new industries will be built around solving all these problems. The underlying "core" of bitcoin is intact. The USD did not have its current market cap in 4 years, it was built up over time.

Start thinking longer term, equilibrium could be met very fast or not so much. We have many different variables going on here:

- Worldwide currency debasement
- Bail-Ins (banks take your deposits)
- Central banks buying gold (they dont trust each other)
- Comex losing its physical gold
- "Faith" in ALL currencies is wasting away

WHY?!!?!?!?

The system is FUBARRED and it takes TIME for EVERYONE to realize it, every second someone makes a move to take their money OUTSIDE the system and buy REAL stuff, and maybe a small % is bitcoins.

This isnt even close to a bubble yet with bitcoin as the penetration rate is sooo jokingly low right now. Go out on the street and ask people what a bitcoin is and how it works, etc.. you will get blank stares..
 
music4mic said:
Deep web sites (i.e. Silk Road and similar) have been using the pay USD in BC equivalent for years now. I get that they do this out of necessity, but it works well enough that they've been going for 2 years now.
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The Soviet Union had a similar problem. Because they had no internal economy for pricing, they would copy the price structures of Hong Kong and the US so they could do economic calculation.

In Japan, things are priced in Yen. In America, things are priced in Dollars. In India, Rupees etc etc.

No one is pricing in BTC. They are converting the local currency into BTC.
 
savantmarketing said:
Go out on the street and ask people what a bitcoin is and how it works, etc.. you will get blank stares..
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that means we've only scratched the surface in terms of bitcoin's investment potential.

in the late 90's dotcoms and Beenie babies were ubiquitous
 
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