[2018-08-05] Bitcoin Merchants See Payments Decline in 2018, Despite Record Low

TheHas

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Quote from: magneto on August 06, 2018, 04:58:01 PM

Quote

If you don't want to use Bitcoin as money during similar market conditions you basically admit that it's not a good form of money.

I disagree. You can do whatever you want with your bitcoins, and it seems to be common sense to not spend as much when the value of your coins have plummeted.

Bitcoin being able to be used for day to day purchases is important for uptake, but its use for purchasing isn't the only thing that should determine if it is a good form of money or store of value.

Gold for example isn't easy to spend at all (much harder than crypto obviously) but it has established and accepted value. Ease of use is just one of many factors that will contribute to Bitcoin's value.

Anecdotally, if you think Bitcoin value will increase over time, than you would hold it for longer, and probably not sell until its price has recovered.

gentlemand

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Number 1 reason is beariness. Why would you spend? Especially if you paid more for your BTC. The number one reason people spend freely is because it's free money which requires it to be more than you paid for it.

Number 2 - Coinbase. They now make merchants handle their own seeds. The only possible reason I can think why is to deter merchant adoption. My main BTC spending outlet has abandoned it because of this as have many others.

Why is there not a Bitcoin payment processor - as in one that provides fiat - who is, kinda crazy I know, actually pro Bitcoin?

buwaytress

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Quote from: Carlton Banks on August 05, 2018, 01:30:18 PM

Quote from: buwaytress on August 05, 2018, 12:15:38 PM

I posted an earlier comment in a thread today that shows at least one merchant willing to try an open source alternative - and it seems to be working out just great (BTCPayServer).

It's possible that BTCPay will be the first to implement Lightning payments too (don't think any other payments solution is doing it yet). Shouldn't take them long to do it, the developers have also done some work for lightning implementations. I hope so, meritocracy FTW (i.e. only those who are more hands-on with running their webshop will benefit).

Couldn't agree more. It was really refreshing to see merchants going through the hassle of learning to implement something like BTCPay, which obviously will be more difficult to do, but they'll gain a huge advantage by having more control, plus benefit from potential upgrades quicker. In this case, LN. It's just like using your own Bitcoin wallet. Small learning curve to overcome but able to use SegWit ahead of centralised wallets.

Also very encouraging to see in the case I shared that the community themselves helped the merchant migrate. Would love to see more of that!

Quote from: guybrushthreepwood on August 07, 2018, 07:02:58 AM

This isn't surprising really to me, but I was actually surprised that those companies transacted $411 million in merely September of last year which is a huge figure. I think the volume of people spending bitcoin will rise and fall with the price spikes and also I think the vast majority of people who are joining bitcoin are doing so as an investment vehicle and 'hodling' (which honestly isn't a bad thing) so that's why there's likely a decline in spending. I'm sure if bitcoin ever gets to $20k again there will be a lot of people buying Lambos hehe.

Quote from: magneto on August 06, 2018, 04:58:01 PM

Quote

If you don't want to use Bitcoin as money during similar market conditions you basically admit that it's not a good form of money.

I disagree. You can do whatever you want with your bitcoins, and it seems to be common sense to not spend as much when the value of your coins have plummeted.

I also agree with your disagree Cheesy

. I've always said people should be able to whatever they want with their bitcoin and if some people want to hold as a future investment then so be it. There's going to be a time when they want to spend it any way but maybe they're just holding out to get more "bang for their buck", but nothing is guaranteed.

Absolutely!

My parents have always been holding on to their foreign fiat even, whenever they get their hands on some, exchanging when the rate is better or waiting out for some local economic downturn. Always expected in developing economies. Perfectly normal to do this with currency, which Bitcoin also is.

guybrushthreepwood

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This isn't surprising really to me, but I was actually surprised that those companies transacted $411 million in merely September of last year which is a huge figure. I think the volume of people spending bitcoin will rise and fall with the price spikes and also I think the vast majority of people who are joining bitcoin are doing so as an investment vehicle and 'hodling' (which honestly isn't a bad thing) so that's why there's likely a decline in spending. I'm sure if bitcoin ever gets to $20k again there will be a lot of people buying Lambos hehe.

Quote from: magneto on August 06, 2018, 04:58:01 PM

Quote

If you don't want to use Bitcoin as money during similar market conditions you basically admit that it's not a good form of money.

I disagree. You can do whatever you want with your bitcoins, and it seems to be common sense to not spend as much when the value of your coins have plummeted.

I also agree with your disagree Cheesy

. I've always said people should be able to whatever they want with their bitcoin and if some people want to hold as a future investment then so be it. There's going to be a time when they want to spend it any way but maybe they're just holding out to get more "bang for their buck", but nothing is guaranteed.

magneto

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Honestly what else would you expect?

I mean, the volume pretty much corresponds with bitcoin's price movement trends. If you actually looked at the bitcoin volume, you'll see that the difference between the high and the troughs are actually not that drastic.

Besides, people tend to not give as much thought to bitcoin during bear markets. It's obvious that they would hold onto their coins instead of spending it as actively as frequently. The figures provided by these statistics only confirm that we're in a bear market, that's all. It doesn't mean that bitcoin's practical use is declining or anything like that.

Quote

If you don't want to use Bitcoin as money during similar market conditions you basically admit that it's not a good form of money.

I disagree. You can do whatever you want with your bitcoins, and it seems to be common sense to not spend as much when the value of your coins have plummeted.

BitHodler

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I agree with some of the above posters that current market cycle is the main reason for the decline in ecommerce revenue, but it's somewhat related to people's ignorance as well.

The main struggle for people is the idea of missing out, and for that reason refrain from spending their coins. People need to understand that every satoshi you spend can and should be bought back at the same price.

I'm not spending my coins very often, but when I do I make sure that I'm never seeing my balance decrease. Bitcoin should circulate like how fiat is circulating when we are using it as money.

If you don't want to use Bitcoin as money during similar market conditions you basically admit that it's not a good form of money.

bbc.reporter

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Quote from: TraderTimm on August 05, 2018, 02:15:11 PM

There's a few things going on here.

BTCPay is taking share from the shitty BitPay (with its proprietary payment protocol that sucks ass) owned by Coinbase.

Also, there is LESS incentive to spend Bitcoin when the price in fiat is low.

If I can theoretically pay a $500 USD price using 0.07 of a Bitcoin, why do that now when I could potentially pay the same $500 USD using 0.05 BTC later on?

I've seen it before, and even with my spending -- we tend to use Bitcoin when its ratio to fiat is superior by a large margin.

This will happen again as price recovers.

Agreed. The costs of missing holding opportunities by spending bitcoins now would be simply high.

In any case, that is what would tend to happen among deflationary assets like bitcoin. The velocity of transactions are low because itmis more valuable to keep, making its real longterm value always going up.

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Quote from: 1Referee on August 05, 2018, 11:02:44 AM

It's truly the bear market that's killing the sentiment, and somewhat the toxic roadmap of BitPay.

Bitcoin's transactions in the last six months have been going up steadily, so it definitely can't be blamed for a decrease in network activity; https://bitinfocharts.com/comparison/bitcoin-transactions.html#6m

People are more inclinded to spend their coins during a market that has gone up a lot already, because that's a form of cashing out profits without being subject to taxation. In current market the trend is down and people will not spend their coins that have gone down in value. It's a huge risk for them in the way that if the price happens to go up, they'll miss out. Selling/spending currently means people actually realized a loss, which isn't something they wan't to let themselves go through.

I fully agree with this statement yet its true that people nowadays would tend to hold up their holdings rather than spending it and accept their loss.Its still a good number on having those $60+M overall transaction on this bear market.
We would see another situation when the market start to green ones again but for now we would see this normal numbers which isn't really new at all. High price = Profit taking = Huge volume same goes into opposite side.

TraderTimm

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There's a few things going on here.

BTCPay is taking share from the shitty BitPay (with its proprietary payment protocol that sucks ass) owned by Coinbase.

Also, there is LESS incentive to spend Bitcoin when the price in fiat is low.

If I can theoretically pay a $500 USD price using 0.07 of a Bitcoin, why do that now when I could potentially pay the same $500 USD using 0.05 BTC later on?

I've seen it before, and even with my spending -- we tend to use Bitcoin when its ratio to fiat is superior by a large margin.

This will happen again as price recovers.

1Referee

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Quote from: buwaytress on August 05, 2018, 12:15:38 PM

All of thise recent data is confusing me though. From my (very incidental) observations, I thought Bitcoin spending was actually on the up.

It's not really easy to digest, but from my perspective and basic level 'research', the transactions being conducted hint at economical peer to peer transactions rather than peer to merchant (gateway) transactions. It's actually a good thing if that's really the case, because that's what Bitcoin is about at the end of the day. We should be dealing with only the receiving party, and not some lousy payment gateways turning merchants into slaves.

If merchants at some point take everything into their own hands and discard centralized payment gateways, it's the best ever thing that could happen to Bitcoin. I welcome any change to get rid of the centralized establishment.

Carlton Banks

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Quote from: buwaytress on August 05, 2018, 12:15:38 PM

I posted an earlier comment in a thread today that shows at least one merchant willing to try an open source alternative - and it seems to be working out just great (BTCPayServer).

It's possible that BTCPay will be the first to implement Lightning payments too (don't think any other payments solution is doing it yet). Shouldn't take them long to do it, the developers have also done some work for lightning implementations. I hope so, meritocracy FTW (i.e. only those who are more hands-on with running their webshop will benefit).

buwaytress

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Quote from: 1Referee on August 05, 2018, 11:02:44 AM

It's truly the bear market that's killing the sentiment, and somewhat the toxic roadmap of BitPay.

Bitcoin's transactions in the last six months have been going up steadily, so it definitely can't be blamed for a decrease in network activity; https://bitinfocharts.com/comparison/bitcoin-transactions.html#6m

People are more inclinded to spend their coins during a market that has gone up a lot already, because that's a form of cashing out profits without being subject to taxation. In current market the trend is down and people will not spend their coins that have gone down in value. It's a huge risk for them in the way that if the price happens to go up, they'll miss out. Selling/spending currently means people actually realized a loss, which isn't something they wan't to let themselves go through.

Still feel there're too many missing holes in data to understand what's really going on, but I am seeing slowly now merchants themselves seeking solutions beyond Coinbase/BitPay/Coinpayments... simply because they're losing customers by being shut out of these former solutions - so that must mean that there is at least enough demand to require them to take some action.

I posted an earlier comment in a thread today that shows at least one merchant willing to try an open source alternative - and it seems to be working out just great (BTCPayServer).

All of thise recent data is confusing me though. From my (very incidental) observations, I thought Bitcoin spending was actually on the up.

1Referee

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It's truly the bear market that's killing the sentiment, and somewhat the toxic roadmap of BitPay.

Bitcoin's transactions in the last six months have been going up steadily, so it definitely can't be blamed for a decrease in network activity; https://bitinfocharts.com/comparison/bitcoin-transactions.html#6m

People are more inclinded to spend their coins during a market that has gone up a lot already, because that's a form of cashing out profits without being subject to taxation. In current market the trend is down and people will not spend their coins that have gone down in value. It's a huge risk for them in the way that if the price happens to go up, they'll miss out. Selling/spending currently means people actually realized a loss, which isn't something they wan't to let themselves go through.

BitcoinArsenal

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Leading crypto merchant-processing services are receiving less bitcoin. In September 2017, companies including BitPay, Coinify, and GoCoin received $411 million. After a low of $60 million in May 2018, the figure now sits at $69 million.
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Topic: [2018-08-05] Bitcoin Merchants See Payments Decline in 2018, Despite Record Low (Read 291 times)