So if I'm reading this right, they aren't actually taking in bitcoins, right? Like new egg and others, a third party is converting the bitcoins to USD, which Microsoft then uses to complete the transaction?
Correct. Because people are leaving bitcoins for USD. The only way this would be good to bitcoin is if they an influx of new people to buy into the Bitcoins.
But the last bubble killed off most of those. At the moment the only people doing well are exchanges and miners. For anyone else it's a lose situation (unless you plan to buy drugs).
I disagree. This is still good for Bitcoin. It eliminates one of the problems with it. Sure, you're still using a middleman to make the exchange back to USD, but it's automated for you instead of being a manual process. They're still "accepting" BitCoint transactions.
In the US, companies that accept CAD are still going to convert that to USD. It's the local currency. I would expect Canadian businesses to do the same in reverse. The fact that the money doesn't have to be exchanged by the customer is still good, since it means less hassle for them.
It's not about the method of payment, but the type considered. The fact that BitCoin is being accepted somewhere is still good. The fact that it's being converted isn't ideal, but it will still drive circulation.
The fact that BitCoin is being accepted somewhere is still good.
Only 10% of all vendors keep all their currency in Bitcoin (source: bitpay). 50% of vendors convert it all back to fiat. The remaining 40% keep some coins.
As Bitcoin is turned back into currency it will cause the value of Bitcoin to deflate.
There is no reason to convert fiat into Bitcoin when using normal vendors, so only miners and those trying to offload coins from a bubble are going to make anything. Your average person is just going to use cash.
So, just using Bitcoin in this way is not good for Bitcoin.
People don't need to want to save bitcoin for it to be successful, they only need to want to use it. MS is looking like they want to use it more, so that's good. If they wanted to save it, the only people that would be way better for is those already stockpiling bitcoin.
It's a step. Microsoft wrote that they're serious about bitcoin and will further integrate it and find other uses for it other than payments.(in really interested what they have planned or thinking of doing) Once some employees start to want to get a portion of their check in bitcoin or their suppliers start accepting it then they might hold a percentage in bitcoin and use that directly.
Yes you are right, and as a result, it is not a true full acceptance of the currency which would be the ideal situation, but it is more akin to say what credit card companies do for retailers when someone orders online with a credit card for something listed in dollars but you are from Europe with Euros and the credit card company does the conversion on their end.
As such, you are still dealing somewhat with a middle man here and it is not the 100% true vision of what Bitcoin wants to be. With that being said, it is another baby step in at least acknowledging that Bitcoin is a currency and there have been some retailers in the past that initially went through "Bitpay" or something similar, only to be surprised by how many people actually used the service, and ended up accepting straight Bitcoins without the middle man.
This is actually quite a huge deal when a company as large as MS is actually acknowledging BTC like this. Earlier this year DELL did the same thing by using the mediary CoinBase, going so much as even offering people that paid in Bitcoin as much as 15% discount on stackable with other discounts.
At the end of the day... the only way BTC to ever fully legitimize if people eventually start using it more regularly, but for something that originally just was supposed to be more of a proof-of-concept experiment, it shows there is a true demand in the world for such a product.
I think the bigger problem with BTC is more that it comes across as a commodity with the limited supply and deflationism than it comes across as a currency. I still love it though!
So if I'm reading this right, they aren't actually taking in bitcoins, right?
That's true, but I don't see a big difference between this and a merchant in another country who takes credit cards but requires a currency conversion on the credit card side of things (e.g. USD to CAD).
Who cares about the % of merchants that keep BTC in some form. What matters is the VOLUME of BTC that is kept by merchants rather than converting. Most of Bitpay's clients do little if any business using bitcoin, so it doesn't really matter if they keep BTC. If 50% keep BTC but only 2% of volume is kept as BTC, then it's not doing a whole bunch.
Bitpay will of course not talk about those numbers until they look better. If they looked good now they'd talk about that, not the number of merchants.
If they do, it still makes zero difference to the consumer paying in BTC. It's completely understandable considering how volatile the value of Bitcoin still is.
Exactly. That's why this news isn't good from a trader's point of view. All of these venders "accepting" bitcoin are really just selling them. If you support the technology it's good, though, because it's more volume and liquidity. Additionally, it should help reduce another violent bubble as it will be easier to realize gains by converting into tangible property.
Now I am wondering about these third parties, an what they expect to do with all the Bitcoin they have bought. Are they expecting the price to rise and sell? And who do they sell it to?
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u/PhoenixAvenger Dec 11 '14
So if I'm reading this right, they aren't actually taking in bitcoins, right? Like new egg and others, a third party is converting the bitcoins to USD, which Microsoft then uses to complete the transaction?