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Commission-free electronic transactions with anyone in the world?



That's rich, commissions are built into it so that if it's ever successful transaction fees will come in and grow over time.

http://en.wikipedia.org/wiki/Bitcoin

"The network never creates more than 50 BTC per block and this amount will decrease over time towards zero, such that no more than 21 million will ever exist.[15] As this payout decreases, the incentive for users to run block-generating nodes is intended to change to earning transaction fees."


The transaction fee stays the same, it's 0.0005 BTC.


I think the anonymity and decentralized design are more important than the small transaction fees. As a sibling comment points out, there are still fees for converting to and from national currencies, which are much less volatile.


So it is free to convert from USD to Bitcoin and vice versa ?

Because clearly I wouldn't want to hold anything in Bitcoin for a long period of time due to its instability.


There is a cost- liquidity and slippage are not accounted by most.


It's quite cheap depending on the service. I use bitfloor, which charges some very small commission ($0.01 on a $40 deposit)


So, there is a transaction fee...


Not for the transaction. The fee is for currency exchange. Should BitCoin be used for more than just purchasing products from Silk Road, it's conceivable that people might one day be prepared to use Bitcoins as a standalone currency.


Correct - in fact (unless you were a speculator) you wouldn't want to hold onto anything in bitcoin for more than the time required to clear a transaction.


Bitcoin seems to be more like payment method than currency.


But when judged as a payment method it has such poor usability that it seems pointless.


If you point out that it has poor usability for payment, well, it's actually a way to store your wealth. If you point out that the volatility makes it a bad idea there, well, it's actually a vehicle for speculation. Why would you speculate on randomly-generated numbers? Well, because it's so good for payment... or keeping your money away from the government... or... crap.


Bitcoin fills a niche that other payment methods can't. IMHO, that's the only value in it.

Bitcoin enthusiasts just have too high expectations for it.




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