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Bitcoin: more than just an alternative to PayPal


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Bill Sahlberg posted a topic about PayPal in the classifieds which disappeared pretty quick, but it got me wondering how many Enos members would be interested in using bitcoin as an alternative to PayPal gift. More broadly: how many members are familiar with crypto currency?

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The irony is: how much do we know about the production of the Federal Reserve Notes in our wallets?

Coinbase a respectible brokerage for BTC I use so I copied this from their FAQs:

What is Bitcoin?
Oct 01, 2015



Bitcoin is a new kind of money that can be sent from one person to another without the need for a trusted third party such as a bank or other financial institution; it is the first global, decentralized currency.


What is Bitcoin, the technology?
Bitcoin was originally released in 2009 by Satoshi Nakamoto as a piece of software and a paper describing how it works. Because Bitcoin is fundamentally software, anybody can run it on their computer, and therefore participate in a global economy.

One of the most important elements of Bitcoin is the blockchain, which tracks who owns what, similar to how a bank tracks assets. What sets the Bitcoin blockchain apart from a bank's ledger is that it is distributed, meaning anyone can view it. Since Bitcoin is open, no company, country, or third party is in control of it, and anyone can participate.


What is bitcoin, the currency?
One can use bitcoins to purchase goods on the internet and in stores. The following are some unique properties of Bitcoin:

  • Bitcoin is global: Bitcoins can be sent to someone across the world as easily as one can pass cash across the counter. Bitcoin isn't closed on weekends and doesn't impose any arbitrary limits.
  • Bitcoin is irreversible: Bitcoin is like cash in that transactions cannot be reversed by the sender. In comparison, credit card, popular online payment systems, and banking transactions can be reversed after the payment has been made - sometimes months after the initial transaction.
  • Bitcoin fees are cheap: Bitcoin transaction fees are usually negligible. Currently, they range from half of a cent USD to 5 cents USD, for a bitcoin transaction of any size. This is significant to merchants, who are used to paying ~2-3% with credit cards (and passing these fees on to their customers), and great for everybody who is accustomed to paying $2 - $5 to withdraw cash from an ATM.
  • Bitcoin is private: When paying with bitcoins, there are no bank statements, and one need not provide unnecessary personal information to the merchant. Bitcoin transactions do not contain any identifying information other than the bitcoin addresses and amounts involved.
  • Bitcoin is secure: Due to the cryptographic nature of the Bitcoin network, Bitcoin payments are fundamentally more secure than standard debit/credit card transactions. When making a Bitcoin payment, no sensitive information is required to be sent over the internet. There is very low risk of your financial information being compromised, or having your identity stolen.
  • Bitcoin is open: Every transaction on the Bitcoin network is published publicly, without exception. This means there's no room for manipulation of transactions, changing the money supply, or adjusting the rules mid-game. The software that constitutes the core of Bitcoin is free and open-source so anyone can review the code.
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What is wrong with systems like Chase Quick Pay, or Square Cash? Both are free to transfer money, as well as being quick and convenient once set up. All that is needed is a checking account. They are my preferred form of money transfer, incoming or outgoing.

Edited by EngineerEli
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Eli, I've never heard of those two and I'm sure they're also cheap, easy ways to transmit US Dollars electronically, but the difference is that with those methods you're trusting Chase or Square Cash with access to your bank account and giving them the right to cancel or revoke and transaction. I like to describe Bitcoin as a language: if you and I agree to speak English we can have a conversation, likewise, if you and I agree to use the Bitcoin protocol we can transmit value, there doesn't have to be a third part involved.

I'll agree as a means of transferring USD bitcoin's advantage over any of these similar services is marginal, but I'm primarily interested in BTC as an alternative to fiat currency altogether. I challenge anyone with even a cursory understanding of central banking to defend it as a rational, moral system of exchange, but inertia is a powerful force so it's hard to convince anyone there's any reason look for alternatives.

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See that's the thing Dave, it was volatile while people were looking at it like a commodity, thinking you could get rich day trading it; now that acceptance has grown (Amazon, Overstock, CVS and Expedia are the most notable) and people are actually using it as money, the exchange rate to USD has remained pretty stable for the past 10 months.

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The problem is the market its associated with. It's so tied to cybercrime and the shady part of the Internet it's hard for to get into. Far too many reports of brokerages shuttering and someone running off with the bitcoins. You aren't recovering it at that point and I don't think it's considered currency in many countries. You can't file charges against it the same way you can cash it PayPal. It's just code. Interesting concept but he lack of regulation is scary

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Bitcoin was a cute idea but it fails at meeting its promised goals, specially because it is very unstable (more commodity then money) and because it really isn't private at all and traceable the moment you want it converted to worlds goods.

What is wrong with cash exactly, federal reserve aside.

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I get it, convert my US Dollars to another form of currency to save processing fees and protect privacy but I can't get too excited about it. I don't convert my US Dollars to Yen before I eat at the Japanese restaurant up the road but I suppose if I got a free sushi roll I would consider it.

Bit Coin is slowly gaining traction, but I think it may be while before it makes it's way on the BE forums. There again, you never know.

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I didn't start this thread to argue with members not using Bitcoin, but rather to see which member share my enthusiasm for it.

So you are saying you want people to agree with you and don't want to hear from people who disagree with you.

Sure have fun with that, let me know when you realize that the FAQ you posted is mostly a list of wants then a list of actual properties of bitcoin.

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I prefer consent in all me social and economic intercorse Vlad, it you don't want to use Bitcoin, I'm not trying to force you to.

I never said I WANT people to agree with me, I want to see WHO shares my preference, which is clearly not you and that's OK.

Edited by kneelingatlas
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I prefer consent in all me social and economic intercorse Vlad, it you don't want to use Bitcoin, I'm not trying to force you to.

I never said I WANT people to agree with me, I want to see WHO shares my preference, which is clearly not you and that's OK.

Since you've reframed the question, let me assure you that I'm not part of the WHO -- but that may have to do with being raised by parents who studied accounting, and who had survived, oh, let's see the Great Depression, World War II, the reconstruction of Germany -- which was a lot like the great depression in terms of unavailability of necessities, and oh yeah, the change to the Deutschmark. Compress all of that into the first 25 years or so of your life, and you become pretty conservative about where you stick your cash.....

Oh forgot one more thing -- if you want to persuade me, you'll need to do more than quote the FAQs from a brokerage (read people who will make from the transactions, and are there fore interested in recruitinging as many users as they can)......

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Right I think it has merits but I've seen the bad side of it too. Unless I'm doing something shady and need to try to wash money or something I don't think I could buy into it right now. In the future you never know.

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I like it, and been using it for a few years. I don't get to use it as much as I would like because most people don't know what it is. No local shops that I know of accept it.

I also had some mining equipment and made some extra income for a while. Now it is way too expensive to break into mining.

I'm a software developer, so Bitcoin is right up my alley.

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yeah, I tried bitcoin mining for a while.

ummm. I think I have a tiny bitcoin... somewhere...

and that is a big piece of the problem... software to facilitate their use

then it still looks like an open field day for hackers/thieves.

I am not against it, simply do not trust it.

miranda

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  • 3 years later...

I don't think, people will stop using PayPal in the nearest future, though there are problems with it. Personally I'm one of them. Speaking about Bitcoin, I haven't tried it yet, but I'm thinking about investing in it. I've recently found a good source where people write reviews and share their expereince in using Bitcoin https://revain.org/projects/bitcoin and they persuaded me that Bitcoin mining is a good idea, though I haven't considered it as an alternative to Paypal. 

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I started this thread in 2015 and conditions have changed somewhat since then, for one the price of Bitcoin in terms of USD has gone from $400 to nearly $20,000, down to $3,000, and today it sits around $5,000, in the meantime the cost of transactions has gone up considerably making other cryptos and tokens cheaper payment methods.  Last time I checked on Poloniex the flat fee to move BTC was over $2, whereas the fee to transmit USDC was $0.02.

 

This is not to say BTC is no longer a viable store of value, I think it's biggest advantage today is it's brand equity.

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Interesting times we live in Atlas.  I created a BC wallet in the $400 time frame of BC, but didn't get around to funding it.  I would have been nice to be a part of the ride to $20K.

 

Keeping an eye out on what's next on the horizon.  From what I've read, the block chain principles of BC are being considered in financial circles as they would negate (or at a minimum significantly reduce) the need for outside, independent review of transactions.

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  • 1 year later...

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