
The New York bar that takes Bitcoins - kunle
http://money.cnn.com/2013/04/08/investing/bitcoin-bar-new-york-city/
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zeteo
>Along with his businesses, Shrem is the co-chairman of Bitcoin Foundation, a
group that stands for promoting and standardizing the new currency

>"When we opened a few months ago, I said that we needed to be the first New
York bar to accept Bitcoins," said Charlie Shrem

So it's more like "Long-time Bitcoin promoter finally able to accept
Bitcoins".

~~~
mrb
Charlie Shrem has been accepting bitcoins for a long time. He founded the
BitInstant company.

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billpg
"How much is a pint of beer?"

"Right now or by the time I finish pouring the drink?"

~~~
baddox
Witty, but I'm pretty sure two adults at a bar can agree on a price without a
great deal of difficulty.

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jellicle
While they "take" bitcoins, they do not do any business whatsoever IN
bitcoins. Nothing is denominated in bitcoins, the bar never receives any
bitcoins, etc. Bar prices its stuff in $, bar gets paid $. The End.

It's almost as if the bar doesn't want to reprint its menu twice a day to
account for the bitcoin pricing bubble.

~~~
baddox
Heaven forbid bitcoin be used for anything. If you buy them just to sit on
them, you're a dirty speculator contributing to the bubble. But if you use
them to purchase something, well, there's something wrong with the way you did
that as well. I'm not sure what it would take to impress some people.

~~~
jellicle
My point is that this bar, run by a person who has drunk the Bitcoin Koolaid,
is still unwilling to take any of the risk associated with doing business in
bitcoins.

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smackfu
As long as you don't keep too much of a BTC balance, the risk seems minimal. I
guess the trick is that with a currency that's increasing in value, it's very
tempting to keep a large BTC balance.

~~~
patio11
The applicability of this to the wisdom of using Bitcoins to pay for drinks
(or anything else) is left as an exercise for the reader.

~~~
Helianthus
Something I've come to realize is that there are now only two kinds of people:
those that have successfully managed that simple exercise, and those that
think Bitcoins are the magical future.

The 'in-between' has long since faded.

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civilian
:/ the article kind of left me wanting more.

How many customers have paid using bitcoin in the first week?

How much of this a novelty attraction versus an actual payment alternative?

Is there a payment dispute system for BitPay?

How did BitPay an the bar owners get put in touch? Is there some interesting
business development story here?

~~~
dsr_
It's still not BC as currency, though: the prices are in USD, and then get
converted for you. That's probably a good thing from the short term user's
viewpoint, as BC is as volatile as a very smelly thing right now. There are
all sorts of traps for a long-term user, though.

~~~
robinh
I'm not very well-versed in economics, but would setting prices to a
relatively non-changing BTC value not actually be a good thing to stabilize
its value, if enough people were to do that?

~~~
badgar
What is the incentive to do so? BTC is expected to rise in value over time
since it's a deflationary currency. So any sane businessperson should expect
to be constantly decreasing the BTC price over time. It's a feature, not a
bug.

~~~
taejo
Yes, but the same effect happens (in the opposite direction) with a normal
inflationary currency. Every few months or years, prices change to reflect
their new value. When prices are doubling or halving once a week, that starts
to get problematic (see interbellum Germany, 2000s Zimbabwe).

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misnome
It was my understanding that bitcoin transactions took about half an hour to
clear? So how can they then say "The transaction happens instantaneously, EVR
promises." Or, is this one of those things that has been fixed recently?

~~~
cschneid
It's about trust. The transaction hits the network immediately. Then a miner
puts it in a block as soon as right away, or as slow as... several days (if
you put a transaction fee, you'll move to the frontish of the line). Once its
in one block, every subsequent block is a vote for its authenticity.

So, if I accept a bitcoin right away, I open myself up to a fairly trivial
double-spend attack. If I wait for one confirmation, it's harder, but still
sorta maybe doable. If I wait for several (1-2hours), it's near impossible.

Compare with taking cash which may be phony, or a CC which is easily charge-
backable, and the business's risk is ... close enough to the same.

~~~
ufmace
Not really. The transaction arriving over the Bitcoin network, which takes
around 10 seconds, is the first pass of authenticity testing - it won't work
unless the account has the money and the sender has the rights to that account
and the nodes forwarding the transaction haven't seen any other spends of that
coin since the last block. At that point, doing a double-spend reliably is
already hard enough that anyone who can do it probably has much better things
to do with the ability than try to skim $20 worth of drinks at a bar.

One confirmation, that is, being included in one block, takes anywhere from a
few seconds to 15 minutes, probably averaging 5-7 minutes. With that, it's
already virtually impossible to double-spend without having enough mining
power to take 51% of the current mining network. That's a bit more hashing
power than the entire current mining network combined. That'll earn you
hundreds of thousands of dollars a day just doing honest mining, and potential
double-spend activity well into the tens of millions or more. Again, why
bother with that to rip off a $20 bar tab? Or even a $2,000 bar tab?

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pdog
The news for me is that the founder of BitInstant (and co-chairman of Bitcoin
Foundation) also owns a bar in midtown Manhattan.

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yarou
I went out on a Monday night to EVR, met Charlie through a mutual friend. I
had no idea that he was involved with Bitcoin at the time, nor that he was
planning on accepting it at EVR. Really down to earth guy, plus the free
drinks didn't hurt my opinion of him. :)

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shmerl
_> Servers bring over a tablet with a BitPay app that lets merchants accept
Bitcoins as a form of payment. The app converts the dollar value of the bill
into Bitcoins and gives customers a bar code...Customers would use their smart
phones to scan the bar code that will deduct the amount from their Bitcoin
accounts. BitPay will credit that $15 to the bar._

This is kind of counter the spirit of direct P2P of bitcoin. I'd expect the
transaction to happen directly between the customer wallet and the wallet of
the bar. Why is the intermediary / conversion needed at the time of the
transaction?

~~~
baddox
It's not much different than any other currency in this regard. You can trade
USD cash for goods directly in person, which is easy and works fine, but you
can also choose to use any of various financial services built on top of USD,
like credit cards.

Bitcoin is still superior to USD cash in many ways, however, because the
"direct P2P" transactions are virtually immune to fraud (e.g. counterfeiting)
and can be done online. Of course, the financial services for bitcoin are
relatively new, which means there aren't any particularly experienced and
trustworthy options. It takes time and a long transaction history because the
average person will trust a financial service provider—remember that credit
card companies used extensive advertising campaigns in their efforts to get
people to think of them as normal everyday USD transactions.

~~~
shmerl
Right, but there is a slight difference. Credit cards work as virtual money
and enable credit as an extra service attached to them. Direct bitcoin
transactions are more similar to debit cards (rather than cash) in a sense
that they enable virtual money and you pay from what you have (except that you
don't need any service to back that up, unlike the debit cards which require
banks to enable them). I.e. ideally in the bar example, one wouldn't need to
use any financial services, but would still be able to pay with virtual money
a la just using a card, of course for that the circulation of bitcoins needs
to be more active, so bar could actually use them, instead of opting for
instantaneous conversion.

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namuol
What are the implications on taxes? Is this legal?

~~~
josephagoss
As long as you pay tax its fine, anyway for the bar they are accepting USD.
Bitpay accepts the transaction and pays USD to the bar, Bitpay worries about
the BTC they collected.

(The bar never sees any BTC from a customer)

