[steveklabnik]

Hi, I work for Balanced Payments, a payments company for marketplaces, YC W11. You can track our plans for cryptocurrency support here: https://github.com/balanced/balanced-api/issues/204

> In an online marketplace it's far far easier to accept bitcoins than credit cards because you have no fraud risk, which is a HUGE problem in online retail.

I'm not sure how you are getting this. Bitcoin is absolutely susceptible to various forms of fraud. Let's make this a bit more concrete: assume eBay accepts BTC. I could sign up for a seller account, make some auction listings, once some people buy them, never ship the goods, and disappear. I could set up a fake seller account, list some fake items, and then also make a fake buyer account, purchase the fake goods with my fake buyer account from my fake seller account, report that everything went well, and now I've laundered some money. That kind of activity can cripple a business.

As a consumer, the irreversability of BTC transactions is a bug, not a feature. You only need to look at the incredible amount of fraud that's happened in the Dogecoin community to see how fraudulent activity can be rampant, and can harm consumer confidence. Consumers expect the ability to be able to initiate a chargeback when fraudulent activity happens. You can't do that with just plain old BTC. When I was home over the holidays, the local TV station ran a story about how you should be using credit cards rather than debit cards to purchase things online, specifically because the credit cards' chargeback policies are often better. "With a credit card, you'll have the money taken off your statement, but with a debit card, it could take over two weeks to get your money back." etc.

Bitcoin is digital cash. Online stores don't allow you to mail them an envelope with $20 inside, because that would be kind of ridiculous for all parties involved. It's only when certain financial instruments are built on top of Bitcoin that have the same kinds of consumer protection and regulatory compliance built in.

[quack]

> Let's make this a bit more concrete: assume eBay accepts BTC. I could sign up for a seller account, make some auction listings, once some people buy them, never ship the goods, and disappear.

This already is a problem on ebay. People post dishonest listings all the time and run with the cash. You have the additional problems of people buying goods with stolen cards or running up the price of an item with no intention of purchasing. With BTC you can verify that a bidder is able to pay for an item, and you can immediately hold the funds in escrow. There is no "overcharging" a Bitcoin account.

> As a consumer, the irreversability of BTC transactions is a bug, not a feature.

Bullshit. Credit card companies are paying people with their own fat. The 3% cashback that you get on purchases for gas and food comes from the profit theyre making on top of that. Many local stores give cash discounts when buying goods, and some refuse to accept cards because they are so expensive.

> It's only when certain financial instruments are built on top of Bitcoin that have the same kinds of consumer protection and regulatory compliance built in.

We dont need your middlemen. I dont need an account to hold my funds when I sell an item online. I dont want to give eBay, paypal, et al, a unilateral authority to withdraw from my bank accounts.

[steveklabnik]

> This already is a problem on ebay.

Exactly. It's a problem that doesn't go away with Bitcoin.

> Credit card companies are paying people with their own fat.

I am certainly not arguing that they don't charge a premium. I'm saying that they do add value.

> We dont need your middlemen.

You may not, but I am quite certain most people do.

[minimax]

Agree with everything you said. Credit cards have useful consumer protections baked in. What happens when you look at it from the merchant's perspective? Lets say someone buys something from me with a card, I ship it out, but then it turns out the card was stolen. Who takes the loss? The merchant or the credit card company? I guess what I'm trying to figure out is whether or not the irreversibility of a transaction might be a good thing for merchants dealing with fraudulent buyers.

[steveklabnik]

Generally speaking, the merchant takes the loss. It would be a good thing for the merchant, except then, they wouldn't have any buyers. I know I wouldn't use a financial instrument structured like that, especially when there's a plethora of ones where I don't hold that liability.

[pault]

M-of-N transactions solve most of the trust problems with online marketplaces without having to cede total authority to the escrow service. If you want to favor the buyer in disputes a la paypal, that's easy, but the worst thing that can happen in the case of a false positive (from the seller's perspective) is the loss of a single transaction, rather than having an entire account frozen.

[steveklabnik]

M of N is useful, yes. All I'm saying is that reversibility is an important part of online transactions, and you need _some_ kind of mechanism here to facilitate trust.