[CPLX]

> actually using bitcoin (that you already have) to buy things is a better experience than using credit cards

It's just not. It's not easier than swiping a magnetic strip and signing something, or typing in sixteen digits (or using autofill or the site's previously saved CC info) and pressing buy.

It's not good that I can't demand a return or have recourse in the event of fraud. And it's not a benefit that with bitcoin I have to spend the money first (to buy bitcoin) and wonder if it will hold its value, versus just buying stuff when I feel like it on credit and covering the transaction within 30 days at no interest cost.

I know there are a lot of people who really want your above quoted statement to be true. But, for now and the forseeable future, it isn't.

[dollaaron]

> It's just not. It's not easier than swiping a magnetic strip and signing something, or typing in sixteen digits (or using autofill or the site's previously saved CC info) and pressing buy.

It's much easier to take your phone, open an app, and scan a QR code, than to take out your credit card, transcribe a 16 digit number, check the expiration date, and enter the CSC (or is it CVC?).

Sure, for websites where your information is already saved, or if you leave all your credit card information saved in the browser, then this isn't easier, but they're still pretty comparable in my opinion. Even if it was slightly more work (which I personally disagree with), I would find that worth not having my credit card information saved by who knows how many third parties.

> It's not good that I can't demand a return or have recourse in the event of fraud.

I've never had to go to my credit card company for a refund, since most places I buy from will take refunds with a receipt or proof of purchase (and if they don't, why would I buy from them?). Fraudulent purchases are another issue, but the risk of fraud is lower with bitcoin versus credit cards (no single number that allows access to all funds, a properly secured wallet is impossible to steal, although I know wallet security is still not the easiest thing to have).

> And it's not a benefit that with bitcoin I have to spend the money first (to buy bitcoin) and wonder if it will hold its value, versus just buying stuff when I feel like it on credit and covering the transaction within 30 days at no interest cost.

This is a very real problem, and what I think will truly determine whether bitcoin gains anything near a large following.

[CPLX]

> It's much easier to take your phone, open an app, and scan a QR code, than to take out your credit card, transcribe a 16 digit number, check the expiration date, and enter the CSC (or is it CVC?).

> Sure, for websites where your information is already saved, or if you leave all your credit card information saved in the browser, then this isn't easier, but they're still pretty comparable in my opinion. Even if it was slightly more work (which I personally disagree with), I would find that worth not having my credit card information saved by who knows how many third parties.

This is the crux of the disagreement though. It's really just not easier to use bitcoin on a practical level. I use Paypal all the time for online business purchases when it's allowed, and it's as simple as clicking on the paypal button, seeing my email address already in the field, and then typing in a memorized password.

For a CC sure I might have to grab the card out of my wallet and punch it in, but my numbers are pretty much memorized by now and it's beyond simple. And I'm one of the anal ones who doesn't like my browser keeping my CC info, many people just autofill in seconds. And the number of times I have to enter the information for the first time is pretty low, I usually use Amazon and various other regular places that have my CC info saved, like everyone else does.

As for having my credit card information saved by third parties, aren't you yourself describing a situation where you have your bitcoin information saved by a third party? Are you really keeping your entire wallet and its keys in your phone and settling the transaction yourself? I assume not.

Difference is if your third party implodes you're totally screwed. If one of my merchants blows their security I might have to be sent a new CC number, or worst case scenario spend some time on the phone disputing a few charges or something, with no real economic risk.

> a properly secured wallet is impossible to steal

Yes. In related news an immovable object is impossible to move.

[venaoy]

> For a CC sure I might have to grab the card out of my wallet and punch it in, but my numbers are pretty much memorized by now and it's beyond simple.

"beyond simple", really? A lot of people would disagree with you. The inconvenience of typing in the CC billing info is the number one reason why fewer sales take place on mobile than on desktop.

And it is one of the main reasons why people stick with a store they know have their CC saved (eg. Amazon) as opposed to buying on some random site where they know it is going to be a PITA to type in all the billing info.

Bitcoin solves this payment friction for a first-time shopper at a given shop, and that's a big deal. You should know this. This is why you yourself admit preferring using Paypal over CC because Paypal also solves first-time shopping friction.

[CPLX]

I'm not sure you are me are using the same definition of simple.

Typing 16 digits plus four digits on the front and three digits from the back of a card in your pocket is incredibly simple. I just described it in one short declarative sentence.

In addition it is mildly tedious, and slightly inconvenient. But extremely simple it remains.

In contrast, bitcoin requires typing in an extremely long and essentially random sequence of alphanumeric characters.

Except that it doesn't you say? Because an app can automate it? Oh wait.

[venaoy]

> I just described it in one short declarative sentence.

Except you forgot: you have to type the expiration date, the cardholder's name, and sometimes the full billing address. I will repeat again: typing the CC billing info is not simple enough and this is the number one reason e-commerce sales conducted on mobile are not as high as sales conducted on the desktop.

> bitcoin requires typing

No. It sounds like you have never made a Bitcoin purchase. Typically the merchant's site launches your local wallet app via a "bitcoin:" URI pre-populated with an address and an amount -> click OK to confirm transaction -> done.

[s73v3r]

One of the reasons I stick with Amazon is, yes, they have my payment info saved. But they also have other things like Amazon Prime, and their reputation. People don't stick with Amazon just because they have payment info saved. They trust Amazon is going to keep their info secure, and if they're unhappy with the purchase, Amazon is going to make them whole.

I don't have that trust and security using Bitcoin with a site I've never used before. I don't know if the site is on the up and up, or if they'll just take my BTC and run.

[venaoy]

Your comment reveals something often overlooked by the crowd shouting "OMG Bitcoin doesn't have chargebacks". Most people shop from merchants they trust, most merchants are honest, most disputes are resolved without chargebacks. Therefore chargebacks aren't really that needed or that important for most transactions.

IOW: you would have no problem paying Amazon in bitcoins, because you trust them.

[sanswork]

One thing most people who claim chargebacks are needed overlook is the impact the availability of chargebacks has on reducing the types of actions merchants take which might require one. The existence of the chargeback mechanism itself means merchants are more likely to ensure customer satisfaction to avoid them. That doesn't mean they aren't needed it could also mean they are incredibly effective at limited merchant fraud or laziness in dispute resolution.

[hnnewguy]

>Fraudulent purchases are another issue, but the risk of fraud is lower with bitcoin versus credit cards

The CC companies have full control over the transactions. They can stop and/or reverse charges. As far as the consumer is concerned, there is very little risk of fraud.

[pash]

You can get fraud protection with Bitcoin (if you want it) by using two-of-three multisig transactions with an escrow agent of your choosing.

The "no recourse for fraud" meme about Bitcoin is simply wrong. There are not many dispute-resolution mechanisms right now because the technology is young and because most existing users don't particularly want (and don't want to pay for) the second-order services that credit-card companies provide. If Bitcoin catches on among a wider demographic, dispute resolution and most other things that Bitcoin "can't do" will get built.

The technology is very flexible and can accommodate just about everything that existing payment mechanisms (and monetary systems) offer; the reverse is not true.

[CPLX]

> The "no recourse for fraud" meme about Bitcoin is simply wrong.

OK, but wait:

> There are not many dispute-resolution mechanisms right now... If Bitcoin catches on among a wider demographic, dispute resolution... will get built. The technology is very flexible and can accommodate just about everything...

Ah, OK. So the fact that there's no recourse for fraud is actually correct. But because, in theory, there could be fraud detection, then there's no reason to worry about fraud.

Reminds me of: https://www.google.com/search?q=assume+a+ladder

[pash]

Are you asking me about the capabilities of the techology, or are you asking me to predict the future? I'm giving you the former.

I don't know what Bitcoin will look like in ten years. I do understand the technology and am interested in having a discussion about it. But on Hacker News, in threads like this one, a great many of the comments demonstrate fundamental technical misunderstandings or seem to regard Bitcoin as a mature ecosystem. So I think it's appropriate to try to dispel the ignorance and to emphasize that Bitcoin is actually a nascent technology, one that offers far more than the rudimentary sort of magic Internet money that we see today. Bitcoin is a base layer for permission-lite financial innovation in whatever direction the market demands. You can build all sorts of stuff on top of it.

That means that if Bitcoin's still around in a decade, the ecosystem will likely look very different from today's. "Assume we will never have a ladder," you seem to be saying. Meanwhile, plenty of capable people are hard at work building ladders.

[cpwright]

I find the fundamental disconnect to be that people are pushing the lower-cost transactions as a bit motivation for Bitcoin. The less enthusiastic point out all of the good anti-fraud infrastructure credit cards have from a consumer perspective. Then the proponents point out you can build that on Bitcoin, which is true; but it doesn't come for free, thus I expect mostly negating the transaction cost advantages that Bitcoin is potentially offering.

[dangerlibrary]

I can give you a sense of the future: Bitcoin will become completely unusable because the blockchain is growing at an increasing rate.

https://blockchain.info/charts/blocks-size?timespan=all&show...

[Goronmon]

>It's much easier to take your phone, open an app, and scan a QR code

These steps have nothing to do with BitCoin though.

>a properly secured wallet is impossible to steal

Define "properly secured wallet"? And whose responsible for securing wallets? "The consumer is responsible" is not the right answer.

[macns]

> Define "properly secured wallet"?

Cold Storage[0] done right, that's a properly secured wallet. I think this is the best, and cheapest security (minus fiat currency conversion expenses) available atm.

> And whose responsible for securing wallets?

With cold storage, you are.

[0] https://en.bitcoin.it/wiki/Cold_storage

[ajross]

This is a digression though. The subject came up in the context of a claim that bitcoins were "just as convenient as credit cards".

Cold storage is essentially isomorphic to keeping treasure in a safe, and needless to say very much not equivalent to making a credit card transaction.

[macns]

> This is a digression

Two things make currency work: usability and security. How can this be a digression?

> Cold storage is essentially isomorphic to keeping treasure in a safe

I'll admit the wiki is a bit tl;dr .. (I guess you didn't read it). Using your "keeping treasure in a safe" quote: Cold storage is like keeping a treasure in a safe, at the bottom of the deepest ocean of another earth-like planet in a solar system which we cannot even assume (knowing about it is impossible;) that exists.

[ajross]

What? No, no, no. Cold storage is exactly as secure as the physical storage used to keep it. Unless that physical safe (or deposit box, or mattress) in which you put the printout or USB stick was launched on an interstellar rocket, then no.

It's true that it's inaccessible to the internet. It's not true that it's more secure than physical storage, because ultimately it is physical storage.

I await your "But you can memorize a key such that the attacker can't use it!" response and am presently googling the XKCD link to zing you with.

[CPLX]

> Define "properly secured wallet"

A properly secured wallet is a true Scotsman.

[ci5er]

For a number of reasons, for some banks doing a pilot in Eastern Europe, I prototyped a card-interoperable system that does something like this. From the user's point-of-view.

  - You shop and check out

  - You are presented a QR that you scan

  - The "app" asks you to sign into your bank.

  - The bank issues you a virtual card with your billing address details, but a one-time-PAN (credit card number), CVV and expiry.

  - There is a sub-account created that is the amount you are about to auth with the merchant. The merchant about to be doing the authorization is linked.

  - The "app" presents the merchant "POS" with the virtual card details

  - The merchant "POS" authorizes it using any gateway they happen to be using. Which in turn does the Brand-Net auth dance with the issuer.

  - On positive auth, the sub-account balance is transferred to the merchant (thanks, VisaNet!), and the OTP (one-time PAN) is tossed in the recycle bin.

In any case, they don't have to deal with 6,000 banks like we have in the US. That said, the US could probably do this easily enough in cooperation with FDC or Total Systems or both.

If the merchant doesn't have the QR-code thing, you can still manually key-enter your one-time PAN virtual card details like you do today, knowing that you don't care about the number past its use right now.

There are a lot of weird details about how it all works if some party or another isn't an active full cooperating member of the system, but the idea is to:

1) Limit card number exposure

2) Get a user's explicit pre-auth for a specific merchant, amount and date

3) Get the usability factor you are talking about

4) Leverage the existing bank card consumer protection rules already in place

Which is not to say that Bitcoin isn't cool. But I'm not sure that it is useful enough for consumers to replace the thin-veneers like this that the existing payment infrastructure players will inevitably roll out.

There may be (and probably are) lots of uses for the blockchain. Consumer payments may not ultimately be one of the big ones.

*EDIT: I apparently am an idiot that can not figure out how to convince the system to let me wrap "bullets".

[foobarqux]

The bar is not physical credit cards but e-wallets like Apple Pay.

[baddox]

It's definitely easier than typing in sixteen digits (plus expiration and security code), assuming you have a device with your Bitcoin wallet handy but no credit card autofiller. If your device has both your Bitcoin wallet and a credit card autofiller, I would say both methods are equally easy.

[hippich]

Comparing bitcoin to credit cards is not quite correct. If you want to compare it to traditional payment instrument, the closest one will be probably cash.

And as for credit cards - product can be built on top of bitcoin to provide similar service I believe.

[Apofis]

I run an E-Commerce shop, with inexpensive products and I get fraudulent purchases all the time. If I don't detect a fraudulent transaction, ship the product, when the chargeback comes in not only am I out of the money, I'm out of the product as well. Losing over 200% on that transaction, plus there's usually associated chargeback fees that could be $35-70. Credit Cards are shit for retailers.

[venaoy]

You attach too much importance to CC chargeback mechanisms. I am a typical American consumer and in 20 years doing about 5,000 credit card transactions I have never had to issue a single chargeback at all. So I know for a fact that I would be willing to use Bitcoin for all its advantages if that meant giving up the ability to charge back. Consider this: credit card fees which are passed to customers by inflating prices by ~2% probably indirectly cost me north of $20,000 over my 20 years of use. I could have saved $20,000 and I would have been totally fine with the lack of chargeback mechanisms in Bitcoin. Even if I end up being scammed one day by a non-reversible $1000 Bitcoin transaction, I would still be $19,000 financially ahead with Bitcoin.

Also, CC chargebacks are far from being perfect. In many cases the customer has no recourse for fraud. For example you cannot chargeback a transaction made more than 60 days ago. Some fraudulent merchants stall shipping (eg. claim delays, issues, ship the wrong thing, etc) for 60 days specifically to exploit this fact and exploit the fact customers don't know about this 60-day chargeback limit. Or if your PIN code is stolen and a fraudulent transaction is made with the PIN code, you will typically be held liable (check your CC fine print, for example: "If your Password or PIN is used in such a transaction, you will be liable for the full debt" from http://www.scotiabank.com/ca/common/pdf/borrowing/revolving_...)

Don't forget that despite the lack of chargebacks, you still have all the other usual recourses available to you if you are defrauded after paying in bitcoins: small court claims, send a complaint to the FTC or BBB, etc. But the fact chargeback mechanisms are rarely needed in the first place, and have various limitations (60-day, PIN stolen, etc) indicates that Bitcoin doesn't need them to be reasonably successful as a payment technology.