Show HN: 10% off at Starbucks when you buy with Bitcoin

They do fluctuate based on location, most (if not all) quick serve restaurants fluctuate their price based on location.

If they are using the same card, they are opening themselves up to a giant world of hurt from cheaters.

Interesting idea! We've got some clever stuff going on, but we definitely aren't taking advantage of geographic differences or the rewards program.

When I use my card to buy drinks and I'm buying more than one, the helpful starbucks employees suggest I make multiple transactions to get more stars.

McDonalds coffee drink rewards occur after just the fifth drink, and the free drink counts as one, so it's really four drinks for a free one

Did you, and if so, how did you address the legal issues brought up in your previous post? https://news.ycombinator.com/item?id=7157180

everyone wants to know, how are you fulfilling the Starbucks card side of things?

Do you have access to a private API?

Are you distributing the barcode of a card you are auto-loading? (but then how do you know the balance post sale?)

Are you screen-scraping?

I think there's a lot of people in this thread that are v curious, please do tell :)

I don't know anything about this app or Starbucks, but barcodes are basically just graphical encodings of numbers, and there is free barcode generation code out there (eg. in python's Reportlab package). The numbers are purchased in bulk from the retailer.

We use the current Coinbase exchange rate. No margin on the exchange. We're trying to keep it simple / focused on newer bitcoin users, but I can definitely flesh out the FAQ.

The refund math is also in the user's favor- more about that in other comments.

This time, I definitely consulted a lawyer.

I'm not an economist, but economists are not good at speculating either, looking at the results: As a a team, economists failed to preview every single financial crisis. Only after the shit hits the fan, media goes back to the few who were able to predict the crisis. There are always solitary birds singing out of the chorus. The chorus never get it right though.

To your statements now:

1) That's true, but doesn't mean anything if you put it out of context and the context might very well change in a couple of years. Crypto-currencies are evolving now, new ones are created trying to tackle bitcoin's flaws. Now seems unlikely but in the future some might be more successful than bitcoin. It's a new sector.

2) There no central governing body, but an investor with a big amount of bitcoin (say 2% of the total) might easily drive the price up, down or side-ways. It's like a financial (assets) market really, a little bit of miss-information and a massive dump of bitcoins will turn the price down at once.

It doesn't make any sense for a merchant to accept bitcoin if:

1) He is not the guy holding a huge bitcoin portofolio or plants too. Say Starbucks as a corporation starts accepting bitcoin today, in 6 month does a massive investment in the bitcoin market. If the investment is big enough the price will go up (supposedly).

2) If they have some inside information which allows them to predict with an acceptable risk the future price of bitcoin.

Other than that - and I'd go for that theory - it doesn't make sense. It's just a marketing trick. They are not expecting big amounts, just very small amounts because as you said bitcoiners are basically short or long term hoarders. But I'm sure they are ready to absorb any bitcoin drop up to a point, but not further. So I'm positive they wouldn't accept 20% of their turn-over being on bitcoin (if they are not feeling suicidal).

From my point of view, this is not too unlike what we have without Bitcoin. With USD or CAD, consumers still have to make a decision whether it is worth exchanging a number of dollars a point in time for something else when instead they can use that money to make more money and eventually have "30 bucks next year".

I can see how making more money with Bitcoin is different than with USD or CAD though, if I were to consider only what you've laid out. With the latter two currencies, I would have to learn about different investment strategies and figure out what would actually make me more money, things as a consumer I don't even know about. But with Bitcoin, I could just hold onto them and except to have more money in the future.

What I am trying to say is I don't think what you've laid out is something new, this incentive–to hold onto money so I can more the future–already exists with our currencies today, but Bitcoin happens to give a little spin to that incentivize–which is it'll easier to have more money in the future.

I would love to hear from a real economist too but I don't think it hurts to take our brains out on a little walk.

My gut feeling is that, bitcoin usage will take off in other use cases, maybe like digital transactions or restricting the use of money for certain things (like color coins).

Sorry for the trouble, and thanks for sticking with it!

They don't look at the app - they (or you) just point the scanner at the screen

It works great. We've tested a bunch of times. The barista just points you at the scanner.

I just did it...it was amazing! I'd prefer to keep a balance alive for longer.

As long as it scans, they're happy. I saw someone pay with an image of their barcode on a smartwatch and the baristas were going nuts over how cool it was.

I work at a Starbucks. The scanners are usually customer facing and all the barista needs to know is that you are going to pay with an app on your phone. As long as there are no complications I doubt the average barista will know or care exactly how you paid. As for the crowd sourced gold card, Starbucks' loyalty program gives you a special card after 30 transactions (Gold Card), once you hit that level, you get a free drink or food item. Every subsequent 12 transactions earns another free drink or food item. These would obviously be earned very quickly if multiple people are using the same account. However, I feel that if this is the way this app works, that it opens itself up to both Starbucks shutting it down quickly and user exploits. You could just generate your own image of this accounts barcode and use it whenever you'd like. The worst that would happen is that the barista would inform you that there wasn't enough money on the card, or that it was an invalid account, something that happens often. So I doubt this is the case with this app, I am interested in how they are running this though.

Edit: Up above it is mentioned that each customer gets their own account. So this isn't an issue.

Ha, we tweaked it a bit since last time you guys saw it, but not much.

Thanks! Those are both wrong. The barcode expires in 25 minutes, but you can hit "I'm done" for a quick refund. I'll fix that.

If you need your money back just hit the refund button and if you need to buy something else, you can load more money on to the app. No need to wait.

To be clear, you don't have to wait 10 minutes- we've just had issues with the websocket stuff. Refreshing the page works if that doesn't. Unless something broke, you can pay and get a card in under 3 minutes.

If so, I'd love to hear about it.

It would be a big opportunity for money laundering, so I doubt it.

They do have an API but it isn't in any way public. It is all in a closed system.

Yes. Many, many plans.

Mostly, I'm worried about trust. The thought was people might be worried that they paid their BTC for nothing. I'll chat with the guys about this, we definitely need to look into a better time solution.

The other thing is- gift cards are all about vendor lock-in, and that's bullshit. Thus the focus on getting your money back in your pocket.

Actually, I think this model is a step forward for btc transactions in general. Getting the details worked out 'in the wild' like this should net them a compelling platform to build from down the road too.

Yep, check out the other comments.

Haha, thanks! @chris-martin was like "I don't know images!" but then immediately took care of it.

Unfortunately we are US only at the moment, but we hope to be able to serve outside the states soon.

Sure. @chris-martin explained the math in another comment, so I imagine you're wondering how we do refunds in bitcoin? The only easy / customer-friendly way we could see to do that was to request an email address, and send that email bitcoin via Coinbase. We didn't think BIPS-70 or any other solutions would work for this, since most people aren't familiar, and the whole purpose of the refund is to cement trust.

Haha sorry that landing page was a little hasty. Optimizing.

Yes! (Both.)

You'll end up spending an amount of BTC that is equivalent to 90% of the cost of your coffee. So, an example: If you choose the $10 option, and $10 is worth 10mBTC (exchange rate made up to simplify the math), then you'd pay 9mBTC and have $10 available to spend at Starbucks. If you then spend $5 of that at Starbucks, you'll end up receiving a refund of 4.5mBTC (the equivalent of the remaining $5).

what's that?

It might work outside the States? But the question really is "will US gift cards work" wherever you are. We've got someone testing in Japan who says he'll report back.

If by "heavily" you mean "bought a tiny bit after the January crash" then.. yes!

People should be able to spend their money however they want. That's what we're excited about.

LOL. I'm not a Starbucks drinker either- I love the imagery.

I definitely want to work with indie shops. It's a numbers game, though- I'll need shops that are interested to step forward and put in some extra effort for this to happen, because we do a lot better / get more people using bitcoin with larger merchants.

I couldn't agree more. Not to mention, in virtually any reasonably sized metropolitan area there are generally plenty of places that simply make better tasting coffee.

Dude you might want to put the down the adderall.

Why does having a Nexus in the picture = professionalism?

Yes we can- and we are. We started with Starbucks for a number of reasons, but I can't wait to get Peets in there. Hell, I'd really love to get some good indie shops- but we've gotta start somewhere.

Side comment: how's does Peets fare for espresso-based drinks?