[chuckup]

This is great news. I've always thought teenagers are the biggest market for bitcoin, they're less likely to have a bank/credit card. Knowing you can now exchange bitcoin for Xbox points makes accepting bitcoin a lot more attractive.

[JoshTriplett]

> I've always thought teenagers are the biggest market for bitcoin, they're less likely to have a bank/credit card.

Which makes it rather difficult to obtain bitcoin in the first place.

> Knowing you can now exchange bitcoin for Xbox points makes accepting bitcoin a lot more attractive.

One major reason for the popularity of the cards you can buy in various grocery/department stores providing points/credit for the various stories (Google Play, iTunes, Nintendo, Xbox, etc) is precisely because you can buy them with cash, redeem them at the online stores, and use the resulting credit to make purchases, all without using a credit card. This really doesn't solve that problem, it just shifts that problem to "how do you obtain bitcoin?"

Idea for a business model: make Bitcoin gift cards, and get them into the various grocery/department stores.

[chuckup]

> Which makes it rather difficult to obtain bitcoin in the first place.

True, but now with Bitcoin a teen can do work for pay over the internet (I assume minors cannot easily get a paypal account). I've seen teens draw incredible art, make avatars, do minecraft related tasks, light programming, etc. So while it's not easy, there is a way for them to obtain it.

I remember scheming for ways to make money online when I was a teen, but my only options were to get someone to send me cash in the mail, or have my parents cash a check (after asking me a bunch of questions as to why someone was sending their 14yr old a $100 check).

Hop over to btc-e and watch thousands of teens daytrade altcoins while chatting, it's eye opening.

[jliptzin]

I had a paypal account when I was 14. I used to build websites and sell them on ebay, it was pretty good money for a high school kid. But for some reason ebay/paypal thought I was running some kind of a scam and permanently banned me. I'm 28 and still banned and they refuse to even take a look at my account or listen to any kind of appeal.

[timboslice]

Something similar happened to me too as a kid, but I was able to create a second account (first account was using my Dad's information, with permission).

They are notoriously difficult to work with as a vendor. I had someone pay for the last milestone of a project, then after the goods were delivered, filed a chargeback with their credit card company. The CC company ruled in his favor, and Paypal offered no way to dispute. I was left with the -$1,500 balance

[iancarroll]

> (I assume minors cannot easily get a paypal account)

They can, very easily. I've had one of my accounts banned after applying for their debit card, but I was able to open another one with the same SSN and still haven't been caught.

[_yrst]

When I was 15/16 I was doing programming with the Bitcoin API for sites in exchange for Bitcoin. While it wasn't difficult for me to setup a Paypal, there was always a risk of it being shut down or Paypal asking me for verification (which actually didn't happen until about a month before I turned 18.) I had heard of it happening to many of my friends in the same age group.

[Kortaggio]

If you're comfortable with meeting a stranger in a public place and paying a small premium over market rates there's always the option to purchase Bitcoins with cash in person. Simply find your counterparty on a message board or LocalBitcoins.

[kolev]

Meet a stranger and take a risk just to load funds into Xbox Live?! Hmmm, why not just buy a prepaid Xbox card at most stores? Also, add the fact that you can lose value with Bitcoin.

[GFK_of_xmaspast]

I'm sure parents are going to love the idea of their child going to meet a strange adult from the internet who has unorthodox ideas about the government.

[tedunangst]

Free candy bar with every bitcoin!

[drzaiusapelord]

>cards you can buy in various grocery/department stores

These are a stop gap measure. Say I have $500 and I put $400 into Xbox points and $100 into Steam points. Then some new game comes out on PC but I'm out of cash because its all tied into Xbox points. This transfer is one-way, so my money is now stuck.

With bitcoin, or some other non-vendor middle-man, I have value sitting in my wallet ready for any transaction that accepts this currency. For someone without easy access to credit, buying a couple bitcoins (or some other cryptocurrency) seems like the better move.

[etchalon]

…accept this move by Microsoft makes you add value to your account, that you cannot withdraw. So, at least in this instance, Bitcoin has not solved any problems.

Once you can purchase content directly using XBT, instead of merely using it as a funding source, you might have a use case.

Otherwise, most people would just buy a prepaid Debit card. It solves actually the same problem you're saying XBT solves, but it's accepted at vastly mere merchants.

[drzaiusapelord]

Except those cards aren't global. In countries with untrusted banking systems they aren't even for sale or they are via their own regional bank that a Western processor will just refuse to accept.

There's still a big problem out there with foreign transactions and the credit card system. Paypal kinda handles this in some scenarios, but it still is unsolved, especially when you're discussing non-trivial amounts of money.

[ZoFreX]

In the UK there is some sort of electronic cash (I forget the name) that can be bought using cash in almost every newsagents. These can in turn be exchanged for bitcoins online. Pretty simple!

That said we also have pre-paid debit cards in some stores now, so it's even easier to have one of those.

(Also it is not uncommon at all for teenagers to have a debit card)

[Jekyll]

You mean Ukash? Despite that, there is still a gap for prepaid Bitcoin gift cards which should be filled.

[bdamm]

Making the equivalent of a coinbase card would be easy enough. Then you get all the app support for spending your coin. Having an actual BTC card could be done with a scratch-off private key I suppose. Buying the card funds the public address.

[richardlblair]

> Which makes it rather difficult to obtain bitcoin in the first place.

Not true. They just need to sell something illegal online and they got bitcoin. :trollface:

[Kortaggio]

That's a great insight, it's incredible as adults how much we take credit cards for granted. An increasing proportion of my non-essential spending (e.g. non-food expenses) now come from online shopping and it's an incredible business opportunity for companies to accept something other than credit cards online, either for teenagers or for adults who can't get a credit card for whatever reason.

[kristofferR]

The FDIC estimates that 7.7% of the US adult population is unbanked, and 20% is underbanked [1]. Being un(der)banked is often very costly, it's one of the worst ways where being poor is very expensive [2].

On a global scale the issue is even worse, there are billions of people without access to proper banking services. I can't even begin to imagine how much time/energy/value/productivity is wasted globally due to that. Bitcoin, or another similar solution, may be the key to helping to bring those billions out of their economic exclusion and into a more prosperous reality [3][4].

[1] https://www.economicinclusion.gov/surveys/2013household/ (2013 National Survey of Unbanked and Underbanked)

[2] https://www.youtube.com/watch?v=YAxL4TB6pmQ (Spent: Looking For Change (Documentary))

[3] https://www.youtube.com/watch?v=6NfNwjJfrOg (What Bitcoin Means For Unbanked Economies)

[4] https://www.cryptocoinsnews.com/cell-phone-connected-unbanke... (The Cell Phone Connected the Unbanked, Bitcoin Will Bank Them)

[_nedR]

Ha. I am a 25-year old Indian founder of a startup in a semi-ramen phase. I have no credit-card - Its hard to get a credit card in India without a consistent income (and you need to show your previous year's tax receipts to prove it). No CC means no access to Amazon AWS or any of its international services. Indian debit cards are useless because the Reserve Bank of India has made it compulsory for all banks to use 3-D secure to authenticate debit card transactions online. So no Google Play, iTunes, Paypal, Steam, Alibaba or pretty much every other international website.

The losses from this would easily be in the tens of millions and possibly in the hundreds of millions. We are lucky (Our company account has a credit card) but this is the biggest roadblock facing every young hacker/freeelancer/startup founder, especially those starting at the college level- You can't even open a Google play developer account. On the other side, there are millions of Indians who are blocked at the last mile while trying to purchase apps, ebooks, music on the Play store or iTunes (Microsoft Store seems to work but i cannot confirm this) with no explanation given other than a cryptic "Transaction rejected by bank" . If you are an app developer wondering why so few purchases come from India - this is the biggest reason why.

It is quite baffling why the likes of Google or Apple can't get off their butts and implement 3d secure (which is becoming widespread everywhere but the U.S.). People are begging Google and Apple to take their money and being rudely turned away.

[kristofferR]

Thanks, that was a great example of how the current financial system is only beneficial for the most developed countries. The fact that you actually have it pretty easy compared to the majority of the world, despite the big problems with your situation, says a lot about how bad the current system is.

Credit/debit cards work in a fundamentally flawed way from a security perspective, you essentially give everyone your "money password" each time you pay for something and have to trust them to not abuse it. Because of that a large number of expensive middlemen, checks and barriers are needed inside the system to ensure that the trust is not abused.

One of the easiest and most obvious ways to prevent abuse of a system is to limit access to that system to only trusted actors. And one of the quickest ways of identifying trusted actors is unfortunately discrimination based on things like prosperity and nationality. That's one of the reasons why so many people are prevented from using bank cards, letting them access the system is considered too high of a risk. I guess that's why the Reserve Bank of India require 3-D Secure for debit cards - as a way to mitigate some risk of abuse.

The reason why so many stores don't implement 3-D Secure is actually pretty logical. The extra step in the order process 3-D Secure adds results in a decrease of completed transactions of up to 30%. The only reason why 3D Secure was created in the first place is because the system it was built on top of is so damn insecure.

Bitcoin will help solve this issue, since it removes the need for trust completely. When paying for something with Bitcoin you don't have that fear that the person/company you send money to will grab more money from your card than you allowed, and he/she/they doesn't have to fear that you won't pay.

Because of this Bitcoin may end up creating a much freer financial world open to anyone, no matter their nationality or prosperity.

[striking]

From the Wikipedia article: "One disadvantage for merchants is that they have to purchase MPI to connect to the Visa or MasterCard Directory Server. This is expensive (setup fee, monthly fee and per-transaction fee)" and "Supporting 3-D Secure is complicated and, at times, creates transaction failures. Perhaps the biggest disadvantage for merchants is that many users view the additional authentication step as a nuisance or obstacle, which results in a substantial increase in transaction abandonment and lost revenue."

[_nedR]

We are talking about Google and Apple here. They should be able to afford it. They don't have to enforce 3-D secure on everybody.. they only have to deploy it on Debit cards from India. Also they don't have to implement it themselves. Many smaller merchants use 3rd party payment gateways.

>>results in a substantial increase in transaction abandonment and lost revenue.

Right now 100% of all debit card transactions in India are abandoned due to lack of 3-D Secure. Almost all Indians who have a bank account have a debit card. A very small minority have acccess to Credit cards.

I think the biggest reason for merchants like Google and Apple to avoid 3-D secure is that they cannot pull money from your account without your permission. Each individual transaction has to be authenticated.

[pionar]

Ok, I'm not sure how bitcoin will "solve" anything related to this issue.

The issue is not the currency, the issue is the bank. Who will start the bank and accept the risky customers? Just because the currency changes does not change the causes of being underbanked.

[celticninja]

with bitcoin you are your own bank, you dont need a bank to give you an account. You create your own and people can send you money and you can send them money at very low cost. sure you dont get traditional services such as overdrafts, or bank charges but for the underbanked this is part of the problem not the solution.

A user in the Phillipines can create a wallet for nothing. Their relative in the US can send them bitcoin, then they exchange it for cash in the phillipines. they dont need a bank just a local trader who will trade bitcoin for cash, this will become more widespread as adoption grows so finding someone to trade with will be easier.

[celticninja]

I cant reply to hnnewguy so i will post it here.

What services does a bank provide? it holds your money, it sends your money, it allows people to send you money. all of these can be achieved by bitcoin.

Outside of these functions everything else is a finacial service; loans, overdrafts, mortgages etc. all of which attract fees and charges, these are products you are being sold, this is not banking.

hnnewguy says that banks accept risk, well the risk they accept is not you, not if you are the one depositing money with them. you are taking the risk by letting them hold your money. they do assume risk but that is when you are taking out a loan or an overdraft, bitcoin does not replace these fucntions. bitcoin replaces, holding, sending and receving money, it does this far cheaper than a bank does, especially for the poor who are hit unfairly with charges that are very high in comparison to their income.

[hnnewguy]

>it holds your money, it sends your money, it allows people to send you money

It also provides an audit trail for where money comes from and where it's going, and assumes some of the responsibility as an intermediary during those transactions. Believe it or not, that's vitally important to businesses.

Banking isn't about making payments. It's financial intermediation, and will not be usurped by Bitcoin. If anything, it will merely adopt Bitcoin into its practices.

>especially for the poor

Maybe I'm dense, but how exactly are the poor paying for things with Bitcoin?

[hnnewguy]

>with bitcoin you are your own bank

A bank isn't a vault to store money, it's a service provider. They provide services for money, including the assumption of risk. Whether those services justify the fees charged is another story. But you certainly aren't "banking" with bitcoin any more than putting cash in your wallet is "banking".

[DaFranker]

celticninja replied to you here: https://news.ycombinator.com/item?id=8734653

[kordless]

The idea of being able to use Bitcoin in games is fairly mind blowing, once you start thinking about the possibilities. Build a house in one game, trade it for armor in another.

[chuckup]

I think even more interesting is the idea of "colored coins" that represent actual items.

I'd start playing Magic: The Gathering again if the digital cards I bought were colored coins or counterparty-style tokens that I controlled, and could trade outside of the game.

If the game itself was open source and p2p, even better - there would be no worry of the company shutting down the servers/abandoning the game. The community could take over and make improvements to the client if needed. The initial creation of the game would be funded by selling the digital cards.

[sublimecalm]

I have thought about this problem a bit especially with Wizards encountering forged cards from China. Honestly Magic and MTGO has been a ripe ground for BTC experimentation.

I think every card they print will eventually be represented as a member of a blockchain.

[draaglom]

And then someone could create a site to exchange the (bitcoin-backed) cards!

But what could we call such a site?

[capt_obvious]

Well, the obvious name would be "Magic the Gathering Online Exchange", but that's slightly long. I guess it should be shortened somehow?

[celticninja]

I like your thinking, what about MTGOX? I know just the frenchman in Japan who could code it for us.

[garethjenkins]

Hey -- as per comment elsewhere in the thread, check out https://www.deckbound.com

We're (I'm the founder) doing what you've outlined. Though the Deckbound-specific games are proprietary, the APIs and services are open -- and you can use the Deckbound card identities to make your own games. Ultimately we plan on p2p game clients as well -- and are building on top of other projects to deliver that.

G.

[kordless]

You could even make the 'funding' method part of the game. I built this just to see if you could scan a code from in game, and it works!

https://vimeo.com/113431070

[Sambdala]

Check out https://www.deckbound.com (project of a friend and business partner).

The initial concept is focused on Trading Card Games and built on the Bitcoin blockchain, but there are very interesting medium-to-long term plans that are very much in the spirit of what you suggested.

[garethjenkins]

Also checkout this hangout tomorrow for more discussion on games & blockchain stuff: https://www.reddit.com/r/xdp/comments/2ozqll/dogeparty_hango...

[palmer_eldritch]

Next trend on the internet: teens doing webcam shows for pedos so they can get bitcoins to fund their xbox accounts.

The medias will love it.