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Comment by phoboslab | Hacker News Reader

Thinking about it, Gumroad is the perfect application for Bitcoins:

http://www.bitcoin.org/

I can't imagine bitcoins in their current implementation gaining traction as a form of payment with 'regular folks'. I mean the whole idea is complicated enough that even I as a technically minded person have trouble fully understanding how it works.

Plus it's not clear to me that there are enough bitcoins to go around. Some comments below point out the fact that bitcoins can be divided down to multiple decimal places. That's great and all but I can't imagine a 'regular person' being comfortable with the idea that they currently posses .00152 bitcoins. I doubt most people think of a penny as .01 dollars, because fractions are confusing. Plus even if that .00152 bitcoins is enough to buy a car, it still just seems like a minuscule amount.

I don't mean to be a huge downer. I think bitcoins are an interesting idea, but if you want to sell things now a more traditional payment method would probably make sense.

No, it isn't. Bitcoins are clever and all, but how many people would be willing to set it up just to see a link?

Sure, at the moment only nerds use Bitcoins, but this _could_ become as universal as PayPal is today.

But yes, it probably doesn't make much (commercial) sense right now.

> Bitcoins [...] _could_ become as universal as PayPal is today

Putting aside numerous other issues, bitcoin.org states "The total eventual circulation will be 21 million bitcoins".

[EDIT: DanI-S pointed out that bitcoins can already be subdivided. So this was switched from "there are too few bitcoins to support even American e-commerce" to "bitcoins are not valuable enough to support even American e-commerce". The number of fractional bitcoins is still an issue, but less immediately.]

At the current ~$0.70 / bitcoin, this means that every American will be able to have ~$0.05 in his or her electronic wallet, once all bitcoins are generated. Assuming that the rest of the world does not participate at all and that bitcoins are evenly distributed.

Sure, you could imagine an instant dollar-to-bitcoin-to-dollar conversion at the point of payment. Or you could imagine a bitcoin2.org that generates more coins. Or you could hope for a massive surge in the value of the bitcoin.

I'd put my money on Paypal sticking around, though.

The obvious hole in your chain of reasoning is that "$0.70/bitcoin" would obviously change when every American attempted to fill his wallet with bitcoins.

Bitcoins are already subdivisable to a whole bunch of decimal places.

Bitcoins probably won't take off (cf the failures of all the other alternative digital currencies so far), but the whole number of bitcoins is no more a roadblock than the limited number of ounces of gold in the world was to getting everyone using gold as currency. The problems basically lie elsewhere.

I'd put my money on paypal sticking around, but I'd also expect the volume on the Bitcoin/USD markets to increase as the value climbs (presumably from rate of new bitcoins from mining declining). I think we could see services using fractional bitcoins behind the scenes and USD (or euros) end to end.

I bet you could make some money facilitating lower fee transactions backed by bitcoins.

Do you actually believe the price of a Bitcoin would remain statically frozen in the present, if everyone was using it?

Just a crazy idea, when something like NaCl catches on perhaps gumroad could generate bitcoins client-side in lieu of payment?

[EDIT: the text below is correct, but a bit too snarky. My apologies.

Also, the site owner could just trust the client to actually run his/her bitcoin-generating code for a couple of hours and send any generated coins - this should earn him/her ~$0.20/hour, rounded down because lots of people have crufty computers. Still not feasible, and generating bitcoins will only get harder in the future, but not as bad as I suggest below.]

Sure, if you're willing to leave your browser consuming 100% CPU for a couple of weeks. And if you're willing to pay the entire resulting 50 bitcoins (~$40-45) you generated (at the cost of ~$60 in electricty, I'd guess)[1], or trust the site to return you the rest. In either case, you'd need to trust the site code to tell you that it's generated a coin, instead of silently sending it back to the server and continuing to run.

At least, that's my understanding of how bitcoins work.

[1] Only GPU-based generation is currently profitable, and there's no way NaCl can be given full access to the GPU - GPUs typically have DMA access, so being able to run arbitrary code on them is more or less equivalent to kernel-level access. In theory, you could verify the GPU code - but that's an enormous job, and there are lots of GPUs that you'd need to check for security holes. And security was not design criterion #1 for these devices, I'd guess.

Something like DirectX/OpenGL access makes sense, but running crypto algorithms through OpenGL (instead of CUDA or the like) is probably infeasible.

Good points. I figured it was probably totally infeasible, thanks for filling me in on why.

I like that idea. It seems like microgeneration is a feature Bitcoin is currently suffering from a lack of. As competition increases, generation seems to be more and more centralized. A low-traffic way to generate small amounts of Bitcoin in a peer-to-peer network would be a great addition to a future Bitcoin protocol.

This doesn't seem like a good match. With different hardware and prices of electricity out there it would be hard to make the system fair for everyone. Also, although minting coins is an important feature of Bitcoin, it seems there's a certain amount of miners needed to offset threat of fraudulent transactions; going significantly above that amount is just wasting planet's resources.

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