It's no wonder there is almost no consumer growth in the bitcoin world while new merchants are announced every other day.
"Since [...] October, along with the integration with Shopify in November, [...] the transaction volume has tripled." Source: http://blog.bitpay.com/2013/12/11/bitpay-exceeds-100-000-000...
Notice bitpay stopped reporting 7 months ago?
Coinbase has also been called out on posting contradictory numbers on their blog posts in the past which lead to them deleting most of their posts related to numbers.
[1] http://www.coindesk.com/overstock-ceo-patrick-byrne-1-6m-bit...
http://www.coindesk.com/overstock-million-bitcoin-sales-futu...
http://www.coindesk.com/overstock-ceo-patrick-byrne-1-6m-bit...
Jan 1 - 170K
Jan 2-29 - $15K/day average
Next 36 days to March 4th they do $400K - $11K/day average
Next 83 days to May 27th they do $600K - $7200/day average
And they did not stop releasing numbers. They recently announced processing $1 million every single day. This is 3.3x their daily average of 2013. Source: http://www.pfhub.com/bitpay-processing-1-million-per-day-ove...
Notice how it is burried in the announcement of the $30M funding round. This is probably why the fact was not picked up by more people.
BitPay had 1k merchants in Sep 2012 [3], 10k by Sep 2013 [5], 30k by May 2014 [6].
BitPay raised $2M in May 2013 [7], and $30M in May 2014 [4].
They had a single office in Atlanta in 2012, now they have 8000 sq ft in Atlanta [8], plus offices in Amsterdam, San Francisco, New York City.
BitPay had 7 employees in April 2013 [9], and 40 by May 2014 [8], and plans to have 100 by end of 2014 [8].
You can bury your head in the sand as much as you want, but their growth is obvious... Have you been to any Bitcoin conference? The number of new startups, flury of projects, funding rounds, etc, is mind-boggling. You belong to the super-minority who believes that "Bitcoin is seeing no consumer growth" (!)
[1] http://www.maxkeiser.com/2013/04/bitpay-processes-5-million-...
[2] http://www.paymentssource.com/news/the-companies-signing-up-...
[3] http://bitcoinmagazine.com/2298/bitpay-exceeds-1000-merchant...
[4] http://finance.yahoo.com/news/bitcoin-payments-pioneer-bitpa...
[5] http://paymentweek.com/bitpay-reaches-10k-merchants-mileston...
[6] http://blog.bitpay.com/2014/05/04/merchant-spotlight-sendowl...
[7] http://bitcoinmagazine.com/4626/bitpay-raises-2-million-led-...
[8] http://blog.bitpay.com/2014/05/21/bitpay-s-office-grand-open...
[9] http://blog.bitpay.com/2013/04/22/bitpay-expands-staff-to-se...
I don't see any growth. Also, 70k transactions/day - one average shopping mall.
1. http://news.walmart.com/news-archive/2012/11/23/walmart-us-r...
If it proceeds to double in size every year then the numbers will stop being 'incredibly low' very soon.
I'm surprised more retailers, particularly those specializing in tech, haven't begun accepting bitcoin. They can accept it on terms they dictate and it's easy publicity.
Bitcoin at its current stage cannot handle many transactions, as you point out. However, this doesn't mean there isn't a plan to make it handle many more transactions. See https://en.bitcoin.it/wiki/Scalability for more.
I think people hugely overestimate how much volume is happening with this though.
this looks like a typical exponential curve to me
It definitely says nothing about consumer adoption.
Transparency reasons, for example?
Which is what the "days destroyed" measurement looks to compensate for https://blockchain.info/charts/bitcoin-days-destroyed https://en.bitcoin.it/wiki/Bitcoin_Days_Destroyed
I think you are confused and thought I was talking about transaction volume on the Bitcoin p2p network.
1) Cashback (1-3%)
2) Chargebacks if needed
by using a credit card. Bitcoins are basically like cash in my mind - very easy to move around, but no protections in case of it being stolen, and no cashback. I think Bitcoin is very neat technology, and has some useful features (transferring money between people quickly and easily with basically no fees), but I fail to see the incentive for me to use it to replace my credit card. The business receiving it receives all of the benefits.
If stores passed the savings onto the consumer with 2 or 3% cashback, I could potentially see people using it. Especially if this was returned as points or something, similar to how it's treated for credit cards.
Additionally, I've been to one or two stores that will actually give a small discount on cash purchases. I hope that trend continues.
Well I don't care about the ability to do chargebacks from newegg, and I care a lot about the ability to not get my financials stolen by hackers, so the "consumer protection" Bitcoin offers here looks pretty good to me.
http://www.justice.gov/atr/public/press_releases/2010/262867...
I believe American Express settled later.
Now, Bitcoin also has its own security challenges (eg. how to secure a wallet), but there are solutions (hardware wallets) making it a fundamentally more secure way of transacting online.
If someone steals my credit card and runs up $8000 in charges on it, I'm not out $8000. There is a piece of paper somewhere that says I owe $8000, but that's not being out the money.
One might have a model of "net worth" as "total assets minus total debts," and normally it's a decent model, and this makes net worth go down. But illegitimate debts put a wrinkle in that model.
Never underestimate the advantage of having money versus being owed money. (This is a start-up lesson, too.)
I recognize this is an extreme story, but you cannot claim that CC info theft "does not matter". When it happens, there are many ways in which it can turn in a big pile of hassle for you.
For one, you can very much have the same happen to any bitcoin user, using their personal details online in such sites.
Your argument is like saying "seat belts in cars don't always make drivers safer, for one people may forget to buckle up and not benefit from increased safety".
Sure, but the end result is the same. It's irrelevant whose fault it is.
Or, reversely, nothing prohibits buying with credit cards online to be done differently and be safe from such fraud (e.g one-off credit card numbers with token generators).
But in the real world, credits cards are used the way we know, and merchants accepting bitcoin still ask for those details.
No it is not: with Bitcoin, an attacker knowing your billing info cannot steal your coins. With your CC info, he can make fraudulent purchases (obviously).
Even virtual credit cards are not safe from fraud. Some transactions over the maximum spending limit or expiration date might still go through [1]. This makes none of them truly single-use since multiple charges can go through. Also, they are a PITA to use especially if you want to regenerate a one-off CC number for every transaction (which nobody does - there is no such thing as a "token generator" as you claim). For these reasons banks have been in fact discontinuing virtual CC services over the last few years, eg. see [2].
By contrast, a Bitcoin transaction is truly a one-time payment that is cryptographically authorizing a specific payment amount to a specific address, and nothing more.
[1] http://lifehacker.com/5831160/use-virtual-credit-card-number... [2] http://slickdeals.net/f/6614180-discover-is-discontinuing-th...
This is also the case with ICC/EMV cards, though the USA hasn't caught up to that for some reason.
--edit-- of course this only applies to physical transactions, online transactions are still vulnerable, yes.
The number of "I had all my bitcoins stolen, here is the list of 25 security precautions I've taken, where did I fuck up" articles is terrifying. I'm willing to sacrifice the 1% savings or whatever it is I'd theoretically get from bitcoin for that peace of mind.
Because we've evolved a hell of a lot of ways for people to offload responsibility over the last hundred or so years, particularly where money is involved.
In general I think it's a pretty good thing.
Sure, the bank/CC company will take responsibility for fraudulent charges. In return, they:
1. Randomly cancel your cards and mail you new ones to limit their risk. (No explanation other than 'security')
2. Refuse to let you use your cards to deposit on gambling sites (which are legal in Canada). They also charge extra fees for 'cash-like' transactions on things like forex sites.
3. Reject large purchases that are 'out of the ordinary' making you look like a jackass. This one happened to my dad while he was booking flights.
4. Skim 2-3% or more of each transaction.
5. Maintain onerous requirements for merchants. Square has helped a lot with this in the first world but in the rest of the world they don't even bother taking electronic payments because it's such a hassle to get approved, lease the machines, maintain a security deposit, etc.
Sometimes it makes more sense to just take the risk of getting scammed than deal with all of the above.
See, people are used to, and are already pretty good at securing valuables such as cash (in a safe, at home, or on themselves). A paper backup presents to additional complexity to store securely. And Bitcoin offers extra advantages: losing your paper backup does not affect you ability to use the wallet, and you can have multiple backups, etc. So a hardware wallet is at least better than or equal to cash in terms of security.
And you have to use a hard to obtain (bureucratic nightmare to exchange), volatile, dealing with shady "institutions" with no real history or assurances behind them (MtGox anyone?), and use a novelty currency for that?
There are "one use" recharchable virtual credit cards used all over the world, you can "fill up" one from your online banking and have it handle as much or as little money as you want (e.g just for one transaction).
This can be done wholly online, and takes like 1 minute.
This is why I use PayPal whenever I can
Of course Bitcoin would be more secure (I own some myself). But from a users point of view this additional security doesn't really matter too much. I rather pay with my credit card and get 1% cashback.
Also cheaper still to buy gift cards via raise, cardpool, giftcardgranny, hundreds of other results for "discount gift cards" which are 3%-6% off AND get your 1% cash back.
1) You don't have to provide private info like CC number.
2) If you bought bitcoins at X and now they are valued at 10X you may effectively enjoy 90% discount on all purchases.
All these mythical user-protecting chargebacks are almost never used by consumers for refunds (companies who care about brand help them settling refunds) and almost always for the cases when you CC details got stolen and used by someone else. Of course, bitcoin payments do not leak your private keys, so the entire class of problems goes away.
2) True, but now once you've spent them does it make sense to buy them back and do it again?
Because most companies are afraid of chargebacks and will take steps to avoid them. Bitcoin payments don't but any minor lapse in personal computer security likely will.
Sweden for example does, and I believe Norway as well. Funny that, Scandinavian countries usually have similar legislation. ( http://blog.btcx.se/bitcoin-nytt/dags-att-deklarera-bitcoin-... )
Companies who don't care about brand and companies who have not yet established a brand are, however, somewhat indistinguishable.
The chargeback facility (among others) provides a cushion and safety net to allow consumers to transact in cases where they are less than 100% certain who they are dealing with.
Removing it would kill the ability of smaller businesses to transact as people like me would never give them any cash, and I would advise my non-technical friends and family to behave similarly.
I know this disagrees with your view on the world, sorry.
Nonsense. Consumer protection laws apply no matter the payment method.
In the UK part of your protection is the fact that there is a third party involved (your credit card issuer) who has a variety of responsibilities to the consumer over and above the responsibilities of the retailer. In practice this means you get better protection as the money can be taken back from the retailer by a third party with a big stick.
Here in the UK the credit card company, as a party to an incurred debt, has a legal responsibility to the consumer that encompasses various things like product quality and returns/refunds. If the retailer does not live up to their responsibilities then the CC provider has a legal responsibility to return the money.
This is under section 75 of the Consumer Credit Act.
You get the option of pulling the payment back unilaterally, but this is subject to those same consumer protection laws, so the merchant can still come after you if you do so without a valid reason as stipulated by the law.
I'm sorry, this is just not true here in the UK (which is what I originally said, it's not the same everywhere), you get assurances from another party in case the merchant disappears, goes bust or just finds a way not to play ball.
This goes well beyond chargebacks and can include things like the CC company being on the hook for repair charges etc. if the goods are not up to scratch, long after the original transaction.
If you need further information then try looking up Section 75 of the Consumer Credit Act. It's all in there and there are loads of consumers' rights guides on the net that will give you the layman's interpretation of the law.
Yes, chargebacks are the usual method a CC company uses in a variety of circumstances, but that doesn't change the validity of my statement - in some places some payment methods will get you a whole load of extra rights compared to BTC or cash.
http://www.moneysavingexpert.com/shopping/section75-protect-...
Edit: We're about to re-launch Bitrated in about a month, with a new system that's been written from the grounds up. If anyone reading this is interested in seeing what we've been working on and would like to provide some feedback before the public launch, please contact me (email in my profile). </shameless-plug>
Of course, I have been passively protected by consumer protection laws, and yes, I would receive the same passive protections when paying via cash or bitcoin.... but when those laws are violated, it's almost never worth it to bring up a legal case. If I pay cash, and I get screwed, I complain to the vendor. However, if the vendor does not give me satisfaction, it's usually just not worth paying a lawyer.
It /is/ however, often worth it for me to call my credit card and get them to take the charge off.
While the credit card might not get me many (or any) more legal rights, it certainly gives me rather a lot more practical power if I have a dispute with a retailer (vs. using cash or bitcoin)
There are quite a few metrics on http://www.bitcoinpulse.com/ that seem to indicate otherwise.
You're right though, it's not gaining consumer adoption, but it is gaining merchant, infrastructure and developer interest.
There are literally thousands of years of history to look at that will show you how naive and ridiculous this view is. Try doing a quick web search on "Caveat Emptor".
And for more recent examples, well try reading anything much about the last few years of bitcoin.
Until one day it all goes wrong, or management change and don't care about service so much.
And that also acts as a barrier for new entrants into the market, stifling competition. When you have to just trust that a new market entrant won't run off with your cash, why would you ever risk it?
There's a hell of a lot that consumer protections and existing payment instruments give us.