Topic: Mass Adoption of BTC (Read 5476 times)

I don't understand this.  I've never paid a fee and I've transferred a lot of BTC around.  I always get the full amount.  It may take an hour or two, but I'm in no hurry.

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Thats the point! It's really simple!!

Simple really, isn't it?

Depends what you mean micro-transactions. If normal shopping amounts 10+ USD, should be not problem. Currently minimal amount to send is about 5500 satoshi, its not even 1 cent !

until today, bitcoin gets stronger and stronger with each bubble. tough bastard

A store of wealth for the coming years, but still used for blackmarket transactions.

However eventually mass adoption will occur and an increase in micro-transactions. Though i don't know the block chain can handle so many transactions at one time. We shall see.

The United States in its current form is a menace to the civilized world, causing even my company to write such clause as:

Customer may not be a national of or resident in the United States, Canada or Japan,
nor may his bank account be located in the aforementioned countries,
nor may the SIS Information System be accessed in such countries.

No materials, securities, redemption codes, certificates or anything issued by the Merchant
may be taken to, used or stored, in the aforementioned countries and [by] their residents.

Pretty fucked up, if an Estonian company needs to employ such precautions. Shame on you!

No; a bank of Thailand said it wasn't explicitly legal, but the Thai government AFAIK hasn't spoken against it.

I think a number of states will definitely go after BTC through legislation, and it is likely the more volatile states. The Robert Mugabe's of the World definitely don't want their citizens to have other options.  Developed nations will likely look more toward regulation.  Hasn't Thailand already declared it illegal? 

governments will find a way to get their tax hands on it eventually. The only avenue they have is legislation because they cant attack the network and stop it.
The real question is how many people would actually no trade BTC even if the government said "you can't buy or sell BTC in this country"
most people currently in BTC would just load up a VPN and keep on trucking like normal. Many use BTC for that exact reason.

I'm glad investment value is far in the lead on this poll. At least I know this forum mostly gets it, unlike many on reddit.

A few odds and ends from comments above:

• "Fees too expensive for microtransactions" - fees are wildly overinflated now because there's no easy price discovery mechanism (and because they're still so low that few people care; some people are just statically extrapolating into the future, isolating one variable and assuming nothing else will change when that variable changes (there needs to be a name for this error)). Once clients incorporate a fee bidding mechanism, fees will fall to their free market level. Since frictionless free markets ruthlessly drive profits toward zero, fees should end up very slightly higher than the actual cost to a miner of processing the particular transaction.
• "We already have gold for a store of value" - gold is not instantly, invisibly, deniably, unconfiscate-ably transferable across borders or stored. The physicality of gold has a few advantages as well, but absolutely Bitcoin offers extremely unique and useful functions that gold can never have. Functions that the wealthy and oppressed will be particularly interested in. Bitcoin is a total game-changer in the multi-trillion-dollar offshore account industry.
• "People buying just because the price is rising is bad" - to a degree, but 1) those people have to familiarize themslves with Bitcoin in order to buy and to know when to make trades, which helps adoption (at least until Second Market introduces liquidity in the BIT by March 2014, though that's only for wealthy investors), and 2) there's a giant difference between price-chasing speculation and long-term Bitcoin-believer buy-in based on the correct ascertainment of Bitcoin's future transactional use value.

The latter is very healthy because such people are strong hands who drive the price up and only sell when necessary and usually only into massive parabolic rallies, helping to blunt them, meanwhile raising market cap (and therefore stability) and overall Bitcoin user base and familiarity, which loops back into increased transactional use. Also, as seen in March/April, the newly wealthy often prefer - for both convenience and tax reasons - to spend bitcoins instead of selling them, making price rise periods the best for merchants, even if they instantly convert to fiat.

Here's a MUST READ post that does a better job of explaining why store-of-value is the main utility of Bitcoin, and how that works to boost transactional value, etc. Some very subtle points are made that I couldn't find the right wording for here.

I think it is time to connect btc with the mobile money systems m-pesa and zaad. That is, it is time to create exchanges where you can buy and sell bitcoins with mobile money.

Regarding the comparison between Gold and BTC, there is clearly the place for two reserve currencies, for hundreds of years people used Silver AND Gold, so there is no reason why we can't see Gold AND BTC. I highly doubt we'll go back to a silver standard again, considering where we've gone, I think that its time for Bitcoin to take Silver's place as the deflationary commodity with slightly less intrinsic value than gold, but more practical applications in commerce.

Gold is gold is gold. I don't think its going anywhere. Through human history, however, the secondary metal has changed, and also has most commonly been used as a more practical version of gold when transferring assets. Just look at American history. The original paper Dollar was backed by silver, but people were intended to use that Dollar to pay taxes & pay for normal expenditures. For super-large expenditures and savings, gold was used.

Yes, I would like to see Bitcoin compete with gold as a store of value.  I still like physical gold, but I like BTC as a non-physical alternative.

What will be the first "mass adopted" use of BTC?

Tips on Reddit? 

I voted investing and preserving wealth since it's already started IMO.  I think money transfers is a really good use also, with super low fees afforded by BTC.

BTC transactions carry a huge tx fee for microtransactions. Centralized systems like LibertyReserve or in the BTC world Inputs.IO work much better for that type of thing.

Yeah I think microtransactions is a good way to get the masses on board.  This is a social network world now, I think people would be willing to tip bloggers or people they follow on a regular basis.  How do you tip someone a quarter on the internet?  Incredibly difficult and a niche Bitcoin can fulfill.

i tend to agree with op. btc not so great for making small internet purchases since there is a market for inclusion in the blockchain and the lack of space will eventually drive the transaction fees up. it could be ok for storing wealth in theory, but we already have gold for that. where it really shines is for serving the markets that we traditionally think of as being served by western uninion, bank wire transfers, fedwire or SWIFT. basically for sending reasonably large sums of money frictionlessly internationally for things like remittances or clearing between financial institutions.

If everybody has it (or can borrow it), everybody wants it, and its fungible, divisible, transferable, and a store of value, then it will naturally become currency.

I feel the same about fiat. Someone have them all already. Worse, if I get some, they are diluted by the day.

Look at all the previous new economies.

Look at the wild west, that's a good example.

Yes, but only if people use it as a currency.

If everybody decided to speculate on BTC at the same time, including merchants, then suddenly its not speculation at all, but an actual currency.

Just sayin'.

It is, but not long lived option. Only increased Bitcoin useability will guarantee certain price level for longer time

That is exactly my point. Madoff's investors ended up with nothing, because they invested a lot of money in nothing. If Bitcoin has no utility, then why would anyone buy it, except to hope that someone else buys it from them for more? That's stupid. It's called a bubble.

Speculation IS a use

I think its more like: its so tough to mine Bitcoins these days, damn I'm late to the party

I don't know.  People threw over 56 billion into the Bernie Madoff ponzi scheme.  What kind of utility was there in that?  It was purely to make money.  Of course I am not saying that Bitcoin is a ponzi scheme at all.  In fact, we should be even more hopeful because it is not!  Once word gets out that this is a viable and successful investment, and the funds such as the Second Market fund or the Winklevii fund are showing huge gains more and more people will jump in just for the profits alone.  The utility will be the profits at that point.

But I am all for some utility too.   We have that going for Bitcoin as well.  And a a steady increase without the ups and downs will help, but that will come in time I think.

That is utterly wrong. The only path to mass adoption is through increased utility and speculation is not a very effective use. If people don't use Bitcoin, then it will ultimately be worth nothing, regardless of the price you pay. If everyone buys bitcoins that nobody uses, then it will end up as just another bubble.

A steady value would lead to mass adoption much more quickly than a changing value because it would reduce uncertainty.

Its amazing how quickly this is all changing

7 months ago I heard a reporter on CBC talking about this crazy digital currency, so I looked into it.  That night my attitude went from extremely skeptical to intrigued.  over then next few weeks, I tried to talk to people about it, and for the most part everyones answer was, say what?
well I am a bit obsessive about things once i get onto them so after reading every blog i could find, I bought some BTC.
since then I have been scammed out of 7500 of my first 10000 dollars invested, and I am still ahead on my investment....
damn you terrahash and yifu
luckily BTC prices are volatile, and as long as you know why you are here you can be optomistic to know that when you invest you will make money,
and if you watch the trends you can sell and double up when your lucky

.. i got lucky bought low sold high three times and turned my 30 leftover btc into 60

I digress.....
BTC is being talked about again, and this time its not just us ocd people who are watching it.  All those friends who said, Say what?, 7 months ago are starting to call me back.  And when I tell clients ill take cash credit or BTC people actually know what im talking about

all we need now is a nice stable 24 month rise to 1500 per BTC and we will begin to see the world jump on the BTC train

What the heck? By that logic the first reaction to most everything should be negative since most things have already been distributed.

Which I think is a very false premise.  How many people have even heard of Bitcoin yet?  And even the ones that have heard of it have not bought any.

The party has just started. 

I noticed that first sentiment that people express when first encountering bitcoin is: most bitcoins have already been distributed, I'm late to the party.

So the natural first reaction is negative.

Of course.  The government should be happy with Bitcoin then if they are getting more tax dollars.

People are worried about it being shut down because they don't know how Bitcoin works. The root cause for 90% of people's worries about Bitcoin.

I think it is going to get hit as a taxable item.

So the logic should be that it will be harder to shut down Bitcoin then the internet.  Why are people worried about it being shut down then?  Sounds impossible?   Regulation is another issue though.

Potentially, it'd be actually easier to shut down the internet. The internet is more centralized in that if you control the switches you can do a massive man in the middle attack. Since most of the switches are owned by US companies, it'd be easier to harm the internet than harm bitcoin. Just look at the NSA.

A better analogy would be "Shutting down Bitcoin would be like shutting down Tor."

Right.  Wouldn't it be like shutting down the internet at this point? 

The entire point of Bitcoin is that you can't 'shut it down'. This  is like the billionth time somebody has tried this argument. Do you people ever try understanding how Bitcoin itself works? If they wanted to "shut it down", they have to 51% it. Which is getting harder and harder every day. Its not going to happen.

I think, sooner or later, especially if Bitcoin goes high, NSA, FBI, will shut it down, block it. I don't know when, I don't know how, but they will do it. Too dangerous. A Dollar is a Dollar, USA owns the world, and it is like this.

I agree with this 100%.

You forget that things have the potential to be "better" for business, rather than "better" for individuals, however. In this case, BTC is "better" for lending businesses, since their repayment is assured in a non-inflationary currency, and this will translate into it being better for normal merchants as well, as more BTC-based transactions occur.

So I suppose that you think people buying things will be the first mass adoption rather than people remitting money?

Love this post!  It is so true.  I agree that companies that adopt Bitcoin they will benefit greatly.  There will be some that do not want to change but they will either have to give in at some point or go out of business.

By 2015? That I am not so sure of but it could happen faster than we expect.

My wife has an online antique business, and sells through a variety of outlets including ebay. I showed her what coinbase was doing with their system including bitdazzle. She was blown away. Her fees drop so significantly that if is almost as if she had been walking uphill to the well to get some water with two anvils strapped to her back, and now she can just drop the anvils and run up the hill.

I am not trying to shill for coinbase or bitdazzle, and I don't know how they will play out in the future. But I do think that if businesses adopt a similar model and it actually works as advertised that those who do not adopt will wither and die. This is a real-world example where bitcoins as a concept meets bitcoins as an application and the results can be staggering. For ecommerce it will be adopt or perish.

If you stuck with filecabinets and typewriters you went bankrupt in the 1980's.

If you decided your business did not need a website you went bankrupt in the 1990's.

If you ignore bitcoins and stay with paypal and credit cards you will go bankrupt by 2015. You will not be able to compete with those who adapt and adopt. They will take all of your business because of the direct benefit to their bottom line. They will be able to offer lower prices and strangle you.

For something to really have mass appeal it has to be better than something that already exists.  The Model T was a hit not because it was a good car, but because it was better than owning a horse.  In other words, it has to be disruptive.  This is also why electric cars have yet to disrupt internal combustion cars.  The mass of people don't see electric as better than gas.  Electric vehicles are toys of the rich, and "novelty" vehicles. 

Why did VCRs take off?  Because watching porn at home was better than going to a theater.  Just ask Pee Wee Herman.

Thus, we need to think of what industry bitcoin will disrupt.  What would a critical mass of people see bitcoin as "better" than?  We bitcoiners understand the technology, and certainly see how BTC is better in lots of ways.  Now, go try and talk your co-workers into moving all their investments into BTC.  Try and explain to Average Joe why paying for something in BTC is better than buying the exact same thing with dollars.  The current system works fine for them, from their perspective. How is BTC better?

Give Jose the field worker a cheaper, easier way to send his money home, and all of the sudden we have huge numbers using BTC.  He doesn't understand the tech, but that doesn't matter.  It works for him.  Bear in mind that many, many more South Asians (mostly from India) send money home than Latin Americans.  Also, 80% of Africa is "unbanked."

Borrowers seldom think of inflation when borrowing, while lenders do. That's because lenders generally pay much more attention to the profitability of their business than their customers. As such, BTC is the natural currency to lend in, if you can get a hold of it.

Second, I suspect that the borrower will likely either already have a ton of BTC ready to lend, or gather the support of people with lots of BTC. Imagine something like Just-Dice. Just-Dice's business is dubious at best and yet it has over 60k BTC invested. Imagine if a similar pool was created after BTC had increased in price to $250. That's over $15 million dollars worth of BTC to lend. That's plenty for such a lender to make consumer loans.

Its possible to wonder if some day a legitimate use for Bitcoin is found. Perhaps the legitimate use only means the bitcoin economy gains the value of a small country like Malta. If that happens, the maximum of 21 million bitcoins means that each bitcoin is worth over $100k. 

If a legitimate use for Bitcoin is never found, then we are left with Bitcoin as a currency for people doing things they want kept from the state.  As more and more people understand the implications of the Wikileaks and Snowden materials, we can expect bitcoin to go well over $1000 in a year or two.

That's the way I see it anyway.  I sold some at $119.99 to buy a car a few months back and have been wondering if I made a terrible mistake.

It is bubbly, but the effect of speculation (investment, entrepreneurship) is taking the price up before its natural price increase. Only if the speculators are wrong, will we have a price hike and then a fallback. Unfortunately it is not possible to know what the natural value is now, neither is it possible to know in advance what the long term stable value will be.

Good thinking. Of course, the borrowing in BTC might be of lower magnitude than current fiat borrowing for two reasons: The borrower can not profit from inflation, and the banks can not get hold of cheap BTC from the Fed.

Utility will come in time.  I think we are still so early on in this that it's main use at this point is for speculation.  It will be a volatile ride for a while until it stabilizes down the road.  The price will be much higher at that point though.  For those that are able to take advantage of the ups and downs, or just hold on for the bumpy ride, there will come a day when Bitcoin is used for many things but it will be a long painful process in the meantime.

Remember the dot com bubble? People bought internet stocks, not because the companies did anything, but because they thought that the prices would keep going up. Remember the housing bubble? Same story ...

If mass adoption of Bitcoin is primarily for investment, the results will be terrible. Don't be stupid. This is what causes bubbles. If everyone buys bitcoins only because they think the price will go up, then we will see yet another bubble. We've already seen two bitcoin bubbles, and the only thing that kept Bitcoin alive in the aftermath is its utility and its potential utility.

In order for Bitcoin to have a sustainable value, it has to have utility. Bitcoin is a payment system with its own currency. Never lose sight of that or you will lose everything.

Wiring money to mexico is a big business. Bitcoin alone won't change that. they need a simple to use system. with bitcoin as the backend.

Jose in US goes to ATM machine puts in dollars and activities 2 cards. He sends one to Mama in mexico. She can take out pesos from ATM in her local store. Now he can go to any of right type of ATM put in more dollars for mama.

Instead of cards being Visa Amex debit cards they are keys to a cloud wallet. the activation gives them access to the one account.

Bitcoin will remain a store of wealth for people and speculators for the foreseeable future. I think it might be used for microtransactions down the track.

My opinion:

First, BTC will be a investment vehicle. The inflationary dollar will cause individuals with many assets to diversify some of that into BTC due to a rapidly declining dollar value, causing BTC to go up in value at a relatively constant pace, albeit slower than the current rate of growth.

Sooner or later a big lender will figure out that BTC is a non-inflationary currency and, to effectively charge higher interest, they and will start offering online consumer BTC loans detached from traditional banking. This will cause a short term depression in price as the artificial supply created by the lending goes onto the market. "Normal" BTCers like me and other people here will promptly buy up a ton of BTC, and the borrowers will be in a position like a short-squeeze. This will guarantee their interest in obtaining BTC just to pay off their debts. They'll eventually figure out that they can get BTC cheaper if they're paid directly in it, so some will pressure employers to do just that.

Next, the BTC loans will cause lots of BTC to be spent in that period of time, bringing in huge revenue to BTC businesses. As these businesses grow, they'll prove that BTC can be a profitable model and this will encourage other business to switch over.

Thus, employers will both accept, and eventually pay out, BTC, thus making it a legitimate currency. This final bump is what will make the price really rocket.

So I don't think it will be any one of the things listed in the poll, but rather a merging focusing on the various advantages of BTC.

What is your opinion on it? How do you think that bitcoin economy is working now?

I am curious to see what people think will be the "break out" use for BTC that will lead to its mass adoption. Despite all the publicity BTC is still an abstract novelty to the general public much like amazon.com and eBay were in 1995.  So, what will be the first true use on a popular scale?

I, for one, think it will be for money transfer.  BTC is a big improvement over the current system of sending money, especially for migrant workers and the working class "unbanked."  Buying things and preserving wealth seems like a much tougher sell to the average Joe who is perfectly comfortable with good old fashioned dollars.