Hacker News new | past | comments | ask | show | jobs | submit login
Microsoft accepting Bitcoin (microsoft.com)
416 points by DavidSJ on Dec 11, 2014 | hide | past | favorite | 148 comments

This is great news. I've always thought teenagers are the biggest market for bitcoin, they're less likely to have a bank/credit card. Knowing you can now exchange bitcoin for Xbox points makes accepting bitcoin a lot more attractive.

> I've always thought teenagers are the biggest market for bitcoin, they're less likely to have a bank/credit card.

Which makes it rather difficult to obtain bitcoin in the first place.

> Knowing you can now exchange bitcoin for Xbox points makes accepting bitcoin a lot more attractive.

One major reason for the popularity of the cards you can buy in various grocery/department stores providing points/credit for the various stories (Google Play, iTunes, Nintendo, Xbox, etc) is precisely because you can buy them with cash, redeem them at the online stores, and use the resulting credit to make purchases, all without using a credit card. This really doesn't solve that problem, it just shifts that problem to "how do you obtain bitcoin?"

Idea for a business model: make Bitcoin gift cards, and get them into the various grocery/department stores.

> Which makes it rather difficult to obtain bitcoin in the first place.

True, but now with Bitcoin a teen can do work for pay over the internet (I assume minors cannot easily get a paypal account). I've seen teens draw incredible art, make avatars, do minecraft related tasks, light programming, etc. So while it's not easy, there is a way for them to obtain it.

I remember scheming for ways to make money online when I was a teen, but my only options were to get someone to send me cash in the mail, or have my parents cash a check (after asking me a bunch of questions as to why someone was sending their 14yr old a $100 check).

Hop over to btc-e and watch thousands of teens daytrade altcoins while chatting, it's eye opening.

I had a paypal account when I was 14. I used to build websites and sell them on ebay, it was pretty good money for a high school kid. But for some reason ebay/paypal thought I was running some kind of a scam and permanently banned me. I'm 28 and still banned and they refuse to even take a look at my account or listen to any kind of appeal.

Something similar happened to me too as a kid, but I was able to create a second account (first account was using my Dad's information, with permission).

They are notoriously difficult to work with as a vendor. I had someone pay for the last milestone of a project, then after the goods were delivered, filed a chargeback with their credit card company. The CC company ruled in his favor, and Paypal offered no way to dispute. I was left with the -$1,500 balance

> (I assume minors cannot easily get a paypal account)

They can, very easily. I've had one of my accounts banned after applying for their debit card, but I was able to open another one with the same SSN and still haven't been caught.

When I was 15/16 I was doing programming with the Bitcoin API for sites in exchange for Bitcoin. While it wasn't difficult for me to setup a Paypal, there was always a risk of it being shut down or Paypal asking me for verification (which actually didn't happen until about a month before I turned 18.) I had heard of it happening to many of my friends in the same age group.

If you're comfortable with meeting a stranger in a public place and paying a small premium over market rates there's always the option to purchase Bitcoins with cash in person. Simply find your counterparty on a message board or LocalBitcoins.

Meet a stranger and take a risk just to load funds into Xbox Live?! Hmmm, why not just buy a prepaid Xbox card at most stores? Also, add the fact that you can lose value with Bitcoin.

I'm sure parents are going to love the idea of their child going to meet a strange adult from the internet who has unorthodox ideas about the government.

Free candy bar with every bitcoin!

>cards you can buy in various grocery/department stores

These are a stop gap measure. Say I have $500 and I put $400 into Xbox points and $100 into Steam points. Then some new game comes out on PC but I'm out of cash because its all tied into Xbox points. This transfer is one-way, so my money is now stuck.

With bitcoin, or some other non-vendor middle-man, I have value sitting in my wallet ready for any transaction that accepts this currency. For someone without easy access to credit, buying a couple bitcoins (or some other cryptocurrency) seems like the better move.

…accept this move by Microsoft makes you add value to your account, that you cannot withdraw. So, at least in this instance, Bitcoin has not solved any problems.

Once you can purchase content directly using XBT, instead of merely using it as a funding source, you might have a use case.

Otherwise, most people would just buy a prepaid Debit card. It solves actually the same problem you're saying XBT solves, but it's accepted at vastly mere merchants.

Except those cards aren't global. In countries with untrusted banking systems they aren't even for sale or they are via their own regional bank that a Western processor will just refuse to accept.

There's still a big problem out there with foreign transactions and the credit card system. Paypal kinda handles this in some scenarios, but it still is unsolved, especially when you're discussing non-trivial amounts of money.

In the UK there is some sort of electronic cash (I forget the name) that can be bought using cash in almost every newsagents. These can in turn be exchanged for bitcoins online. Pretty simple!

That said we also have pre-paid debit cards in some stores now, so it's even easier to have one of those.

(Also it is not uncommon at all for teenagers to have a debit card)

You mean Ukash? Despite that, there is still a gap for prepaid Bitcoin gift cards which should be filled.

Making the equivalent of a coinbase card would be easy enough. Then you get all the app support for spending your coin. Having an actual BTC card could be done with a scratch-off private key I suppose. Buying the card funds the public address.

> Which makes it rather difficult to obtain bitcoin in the first place.

Not true. They just need to sell something illegal online and they got bitcoin. :trollface:

That's a great insight, it's incredible as adults how much we take credit cards for granted. An increasing proportion of my non-essential spending (e.g. non-food expenses) now come from online shopping and it's an incredible business opportunity for companies to accept something other than credit cards online, either for teenagers or for adults who can't get a credit card for whatever reason.

The FDIC estimates that 7.7% of the US adult population is unbanked, and 20% is underbanked [1]. Being un(der)banked is often very costly, it's one of the worst ways where being poor is very expensive [2].

On a global scale the issue is even worse, there are billions of people without access to proper banking services. I can't even begin to imagine how much time/energy/value/productivity is wasted globally due to that. Bitcoin, or another similar solution, may be the key to helping to bring those billions out of their economic exclusion and into a more prosperous reality [3][4].

[1] https://www.economicinclusion.gov/surveys/2013household/ (2013 National Survey of Unbanked and Underbanked)

[2] https://www.youtube.com/watch?v=YAxL4TB6pmQ (Spent: Looking For Change (Documentary))

[3] https://www.youtube.com/watch?v=6NfNwjJfrOg (What Bitcoin Means For Unbanked Economies)

[4] https://www.cryptocoinsnews.com/cell-phone-connected-unbanke... (The Cell Phone Connected the Unbanked, Bitcoin Will Bank Them)

Ha. I am a 25-year old Indian founder of a startup in a semi-ramen phase. I have no credit-card - Its hard to get a credit card in India without a consistent income (and you need to show your previous year's tax receipts to prove it). No CC means no access to Amazon AWS or any of its international services. Indian debit cards are useless because the Reserve Bank of India has made it compulsory for all banks to use 3-D secure to authenticate debit card transactions online. So no Google Play, iTunes, Paypal, Steam, Alibaba or pretty much every other international website.

The losses from this would easily be in the tens of millions and possibly in the hundreds of millions. We are lucky (Our company account has a credit card) but this is the biggest roadblock facing every young hacker/freeelancer/startup founder, especially those starting at the college level- You can't even open a Google play developer account. On the other side, there are millions of Indians who are blocked at the last mile while trying to purchase apps, ebooks, music on the Play store or iTunes (Microsoft Store seems to work but i cannot confirm this) with no explanation given other than a cryptic "Transaction rejected by bank" . If you are an app developer wondering why so few purchases come from India - this is the biggest reason why.

It is quite baffling why the likes of Google or Apple can't get off their butts and implement 3d secure (which is becoming widespread everywhere but the U.S.). People are begging Google and Apple to take their money and being rudely turned away.

Thanks, that was a great example of how the current financial system is only beneficial for the most developed countries. The fact that you actually have it pretty easy compared to the majority of the world, despite the big problems with your situation, says a lot about how bad the current system is.

Credit/debit cards work in a fundamentally flawed way from a security perspective, you essentially give everyone your "money password" each time you pay for something and have to trust them to not abuse it. Because of that a large number of expensive middlemen, checks and barriers are needed inside the system to ensure that the trust is not abused.

One of the easiest and most obvious ways to prevent abuse of a system is to limit access to that system to only trusted actors. And one of the quickest ways of identifying trusted actors is unfortunately discrimination based on things like prosperity and nationality. That's one of the reasons why so many people are prevented from using bank cards, letting them access the system is considered too high of a risk. I guess that's why the Reserve Bank of India require 3-D Secure for debit cards - as a way to mitigate some risk of abuse.

The reason why so many stores don't implement 3-D Secure is actually pretty logical. The extra step in the order process 3-D Secure adds results in a decrease of completed transactions of up to 30%. The only reason why 3D Secure was created in the first place is because the system it was built on top of is so damn insecure.

Bitcoin will help solve this issue, since it removes the need for trust completely. When paying for something with Bitcoin you don't have that fear that the person/company you send money to will grab more money from your card than you allowed, and he/she/they doesn't have to fear that you won't pay.

Because of this Bitcoin may end up creating a much freer financial world open to anyone, no matter their nationality or prosperity.

From the Wikipedia article: "One disadvantage for merchants is that they have to purchase MPI to connect to the Visa or MasterCard Directory Server. This is expensive (setup fee, monthly fee and per-transaction fee)" and "Supporting 3-D Secure is complicated and, at times, creates transaction failures. Perhaps the biggest disadvantage for merchants is that many users view the additional authentication step as a nuisance or obstacle, which results in a substantial increase in transaction abandonment and lost revenue."

We are talking about Google and Apple here. They should be able to afford it. They don't have to enforce 3-D secure on everybody.. they only have to deploy it on Debit cards from India. Also they don't have to implement it themselves. Many smaller merchants use 3rd party payment gateways.

>>results in a substantial increase in transaction abandonment and lost revenue.

Right now 100% of all debit card transactions in India are abandoned due to lack of 3-D Secure. Almost all Indians who have a bank account have a debit card. A very small minority have acccess to Credit cards.

I think the biggest reason for merchants like Google and Apple to avoid 3-D secure is that they cannot pull money from your account without your permission. Each individual transaction has to be authenticated.

Ok, I'm not sure how bitcoin will "solve" anything related to this issue.

The issue is not the currency, the issue is the bank. Who will start the bank and accept the risky customers? Just because the currency changes does not change the causes of being underbanked.

with bitcoin you are your own bank, you dont need a bank to give you an account. You create your own and people can send you money and you can send them money at very low cost. sure you dont get traditional services such as overdrafts, or bank charges but for the underbanked this is part of the problem not the solution.

A user in the Phillipines can create a wallet for nothing. Their relative in the US can send them bitcoin, then they exchange it for cash in the phillipines. they dont need a bank just a local trader who will trade bitcoin for cash, this will become more widespread as adoption grows so finding someone to trade with will be easier.

I cant reply to hnnewguy so i will post it here.

What services does a bank provide? it holds your money, it sends your money, it allows people to send you money. all of these can be achieved by bitcoin.

Outside of these functions everything else is a finacial service; loans, overdrafts, mortgages etc. all of which attract fees and charges, these are products you are being sold, this is not banking.

hnnewguy says that banks accept risk, well the risk they accept is not you, not if you are the one depositing money with them. you are taking the risk by letting them hold your money. they do assume risk but that is when you are taking out a loan or an overdraft, bitcoin does not replace these fucntions. bitcoin replaces, holding, sending and receving money, it does this far cheaper than a bank does, especially for the poor who are hit unfairly with charges that are very high in comparison to their income.

>it holds your money, it sends your money, it allows people to send you money

It also provides an audit trail for where money comes from and where it's going, and assumes some of the responsibility as an intermediary during those transactions. Believe it or not, that's vitally important to businesses.

Banking isn't about making payments. It's financial intermediation, and will not be usurped by Bitcoin. If anything, it will merely adopt Bitcoin into its practices.

>especially for the poor

Maybe I'm dense, but how exactly are the poor paying for things with Bitcoin?

The Blockchain provides an audit trail that is considerably more transparent and easy to access than the audit trail a bank uses.

I agree, bitcoin is not out to replace banking but it can offer banking facilities to those who cannot get them and banks will adopt bitcoin for the benefit it provides them, in all likelihood bitcoin will underpin financial transactions without the end user knowing particularly with regard to international transfers.

It is not about paying for things with botcoin, for the poor most banks won't touch then because they are not financilly viable, ie their income is to low for the bank to safely lend them money (loans, overdrafts, credit cards) as a result they don't even get to access the basic hold, send, receive money services.

Think of international remittance, a worker wants to send money home, he wants to send $50, Western union charge 10% of that, a bank would probably charge 20% to send it to Philippines. This second option requires the person in the Philippines to have a bank account, which is not always the case. The first option cones at significant expense for the sender.

>The Blockchain provides an audit trail that is considerably more transparent and easy to access than the audit trail a bank uses.

If I send money to someone unintentionally or undeservedly, how does the block-chain rectify that charge?

My bank simply reverses it. That's powerful.

>This second option requires the person in the Philippines to have a bank account

True, but Bitcoin requires a cell phone or consistent internet access, doesn't it? And there's no recourse to having your money stolen or lost? I'm not sure those are appealing scenarios to the poor, either.

Transaction fees aren't high "just because". Otherwise anyone could open a lending facility of some sort and kill it. I mean, it's not like Western Union is making excessive profits. There's a matrix of risk involved with the movement of money. Bitcoin solves some, and creates others.

Point 1 - there is no way to reverse a transaction in bitcoin. If you make mistake you make a mistake. You can request the funds be returned and these things have happened. But let me ask you how often do you send bank payments to the wrong person. Most people will check the details, be it sort code and account number or bitcoin address. Even getting a transaction reversed with a bank is not a simple process and it is not always possible otherwise carders would not be able to withdraw funds successfully because at some point a bank can stop the outflow of money, the difference is the bank takes the loss not you. However when banks take a loss we all take a loss.

You don't need constant Internet access to use bitcoin. If you have an address for payment you can receive payment to it without being online. Next time you check the address the funds are there.

There is recourse to theft, the same ones available to people now, law enforcement. Yes you cannot guarantee the return of funds at present however insurance and insured wallets will be available and in some cases already are. Also security in the area is improving significantly all the time.

Western union make about $200 million a year in profits. So it is making a good profit. But transaction fees are high because the infrastructure needed to send payments internationally is extremely entice to build. Or it was before bitcoin came along. People forget that bitcoin is as much about the Blockchain technology as it is the currency. It is the Blockchain that makes transaction fees low and it is one of the primary reasons that bitcoin will "kill it" in the end.

Perhaps you are being dense I am not sure. I said

The poor pay more for banking services than the better off do. This means they pay a higher percentage of their income for bank fees. I did not say they were buying things with bitcoin. Just that bitcoin allows them to transact far more cheaply than traditional banks do.

>with bitcoin you are your own bank

A bank isn't a vault to store money, it's a service provider. They provide services for money, including the assumption of risk. Whether those services justify the fees charged is another story. But you certainly aren't "banking" with bitcoin any more than putting cash in your wallet is "banking".

celticninja replied to you here: https://news.ycombinator.com/item?id=8734653

The idea of being able to use Bitcoin in games is fairly mind blowing, once you start thinking about the possibilities. Build a house in one game, trade it for armor in another.

I think even more interesting is the idea of "colored coins" that represent actual items.

I'd start playing Magic: The Gathering again if the digital cards I bought were colored coins or counterparty-style tokens that I controlled, and could trade outside of the game.

If the game itself was open source and p2p, even better - there would be no worry of the company shutting down the servers/abandoning the game. The community could take over and make improvements to the client if needed. The initial creation of the game would be funded by selling the digital cards.

I have thought about this problem a bit especially with Wizards encountering forged cards from China. Honestly Magic and MTGO has been a ripe ground for BTC experimentation.

I think every card they print will eventually be represented as a member of a blockchain.

And then someone could create a site to exchange the (bitcoin-backed) cards!

But what could we call such a site?

Well, the obvious name would be "Magic the Gathering Online Exchange", but that's slightly long. I guess it should be shortened somehow?

I like your thinking, what about MTGOX? I know just the frenchman in Japan who could code it for us.

Hey -- as per comment elsewhere in the thread, check out https://www.deckbound.com

We're (I'm the founder) doing what you've outlined. Though the Deckbound-specific games are proprietary, the APIs and services are open -- and you can use the Deckbound card identities to make your own games. Ultimately we plan on p2p game clients as well -- and are building on top of other projects to deliver that.


You could even make the 'funding' method part of the game. I built this just to see if you could scan a code from in game, and it works!


Check out https://www.deckbound.com (project of a friend and business partner).

The initial concept is focused on Trading Card Games and built on the Bitcoin blockchain, but there are very interesting medium-to-long term plans that are very much in the spirit of what you suggested.

Also checkout this hangout tomorrow for more discussion on games & blockchain stuff: https://www.reddit.com/r/xdp/comments/2ozqll/dogeparty_hango...

Next trend on the internet: teens doing webcam shows for pedos so they can get bitcoins to fund their xbox accounts.

The medias will love it.

No, Microsoft is not accepting Bitcoin. Microsoft's hosted shopping cart program, like several other shopping cart programs, is now handling Bitcoins for merchants who accept them. Microsoft's page says: "You can only use Bitcoin to add money to your Microsoft account and then purchase digital goods at select Microsoft online stores. You can’t use Bitcoin to purchase Microsoft products and services directly at this time."

So this is apparently for Microsoft partners who want to accept Bitcoin. Any idea which partners do? Microsoft's site is rather unhelpful; it keeps demanding a login.

But at the top it says: You can now use Bitcoin to add money to your Microsoft account. Once you add money to your Microsoft account, you can use it as a payment option to buy apps, games, and other digital content from Windows, Windows Phone, Xbox Games, Xbox Music, or Xbox Video stores.

Which certainly sounds like normal usage of a Microsoft Account, getting stuff for Xbox. Maybe they meant you can't buy like Office or Windows with it.

> for merchants who accept them

Which now includes Microsoft.

If you didn't know, Microsoft has chosen to accept bitcoin through their payment provider (otherwise that option would not appear). So I guess I don't understand what your point is.

Microsoft's announcement says "You can’t use Bitcoin to purchase Microsoft products and services directly at this time." It's not clear exactly what you can purchase. In-game items?

You basically buy credit to buy apps, games, dlc, music, etc. This a bit of relic from the days of Microsoft points that you needed to use on the Xbox 360. When I buy an app with my Windows phone it can directly charge my provider.

Keyword: "directly"

This might sound corny, but you are my favorite gadfly. I've seen many posts from you over the years on slashdot and HN pointing out flaws with things I love such as python, and now lately bitcoin. I don't always agree with you, but I'm glad you're around.

> No, Microsoft is not accepting Bitcoin.

The simplest way to rebut your assertion is to link to the official announcements by Microsoft [1] and their bitcoin payment processor (BitPay) [2].

[1] http://blogs.microsoft.com/firehose/2014/12/11/now-you-can-e...

[2] http://blog.bitpay.com/2014/12/11/microsoft-chooses-bitpay-t...

Biggest point is someone fairly high up at Microsoft said yes to Bitcoin - executives at massive companies are taking it seriously.

>executives at massive companies are taking it seriously.

Having come from they heydays of Facebook gaming, and having seen the rise and fall of numerous payment providers, I'm not sure how you draw that conclusion.

Implementing a new form of payment is trivial, especially one that's now relatively "mainstream", as Bitcoin is. I doubt there were many late nights in the board room considering this decision.

Now I just need a anonymous way to get some BC without farming it or meeting some shady guy near the main station in Frankfurt...

I hope those BC vending machines get more popular here.

Vending machines will almost certainly have cameras. And incautious use could still leave DNA or fingerprints. Best anonymity is to mail cash to a LocalBitcoin seller. Take care to get unregistered bills (ATMs and bank withdrawals could trace serial numbers, though WF claims they do not). Get big bills, then shop for change. Take great care in preparing the envelope. Consider using a remailer. Some post offices will even do that for you. Address it to the postmaster, and include a ready piece of mail inside. And remember, the seller could be an operative of whoever you're trying to keep anonymous from.

Biggest issues are A: your general geo location is known (though remailing adds one more party to penetrate, OTOH, if the post scans every piece of mail, auto correlation could be easy). B: buying stamps is getting harder, anonymously. Cameras all over. Automatic machines require credit cards.

Source: I was thinking of operating a hidden service for hosting. I wanted to see how much work it actually was for potential customers to buy anonymous BTC and spent a few days attempting to do so. For people wanting to have strong (state level) security, it seems very difficult to get it right.

Edit: A real solution is, if zero knowledge proofs are real and can scale, is to have an active market that uses that tech. Then you go and trade in and out and can get lost in the noise, if enough transactions are occurring. But we'd need serious buy in, otherwise it's pretty unique behavior. But it could be a great extra layer.

The one in Berlin Kreuzberg, in an "alternative" Bar looked nice. I think it's the only one in Germany atm. I don't think they have cameras.

And yes. I had similar thoughts. The only local seller I came up with in my area that would sell smaller ammounts wanted to meet in person. Which is...I don't know. I have a bad feeling about that.

Since I "only" want to pay an VPN with them (maybe some space also if that works out), I would probably take the mail-way you've described if it would have been aviable.

I now think about paying the VPN with vouchers I can buy in a local shop somewhere but no idea if that works with vouchers I buy here in Germany.

As a local seller, I'll want to meet in person because I don't trust any method of payment that is not cash in my hand.

I can totally understand that. Don't take me wrong. The thing is that I don't want to meet you because it may end bad for me. I don't know you. It feels like buying weed as a teenager again. I don't need that anymore ;)

And... Meeting someone in real space means they can probably pretty easily find out your identity. If I were running intelligence/LE operations, I'd make sure to place well rated agents on LocalBitcoin. Offer good prices, make a bunch of transactions to get a great rating, etc. Then I'd record all interactions, including voice and video, as well as try to obtain DNA/fingerprints ("OK is this right? Wanna do the honor of hitting enter? "). That requires very little work. For large buys, a simple tail might conclusively provide identification info.

Yeah, exactly the same for me. That's why I'll ask to meet in a cafe or something.

Tell me when you come by Frankfurt. Apfelwein is on me :)

Haha, I'll be in Munchen after the MWC, which is probably the closest I'll get to Frankfurt :)

Similarly, let me know if you're in Thessaloniki!

Perhaps we should get them the old fashioned way, by hacking peoples accounts?

Can't you use one of those online 'buy bitcoin' options? I understand using an exchange for just buying bitcoin is a bit of a hassle, but services like HappyCoins support online banking so you can just select your amount, choose the destination address, et voila.

I don't really see the use of it. I want privacy. This is why I'm interested in BC. There are no other reasons. Using an 3rd party that has my bank data is pointless because I could just pay directly through the bank/CC/similar.

So you want to be anonymous... But you automatically assume someone anonymous is "shady".

I assume everybody who sells/buys stuff around the Main Station in Frankfurt is shady. Yes.

FYI: most of them are drug dealers.

Mining is probably going to be your best bet for a while...

why do you need it to be anonynous to buy Xbox live credit/points?

I don't need them for Xbox. It was a general comment since they seem to become so popular that even MS is using it.

it was the "now all i need" as if you had been waiting for MS.

anyway to obtain them truly anonymously you can buy from an exchange using your bank and then mix them so the coins you are sent back are in no way related to the coins you bought on an exchange. further you could sell them for an alt-coin e.g. litecoin, transfer the litecoin to a different exchange (that only deals in cryptocurrencies and so does not require your real details) and buy bitcoins. these againw ould be totally unlinked to your original purhcase. Voila anonymous bitcoins.

God that sounds complicated. Maybe I should make a trip to Berlin instead...

it may sound complicated but when you consider it is probably 30 minutes sitting at a computer (something you are probably already doing) it really isnt.

A very easy way:

Go to localbitcoins.com

find a seller

buy bitcoins using your bank account

send coins to HELIX/Bitcoinfog or another mixer of your choice.

*Retrieve coins from the mixing service.

Unfortunately LocalBitcoins is currently not available in your selected region. Please look for other location or come back later.

Are you in Germany?

If so try bitcoin.de they are partners with Fidor bank and make purchasing coins very easy.

You may also want to consider if yiu even need to mix the coins. If you want to pay for a VPN I'm assuming you have looked into a privacy friendly provider. They will not keep logs of bitcoin addresses. If you transfer from bitcoin.de to another address e.g. Electrum wallet or blockchain.info Web wallet then send then to the VPN it is incredibly unlikely that anyone could link you payment to your original purchase conclusively. If you really think that the alphabet guys care then use a mixer like Helix and they I'll never be able to conclusively link your VPN purchase to you.

This sounds interesting.

Danke ich schaue mir das mal an.

Curb your enthusiasm.

You can't purchase laptops:


It's great for adding Bitcoin to their options, but is there some way to find out how much income someone has in Bitcoin (if they include it in their shop?)

The closest thing i found was by an article about shitexpress on http://goo.gl/4ri1B5 , they added paypal as payment method and their revenue was +370%.. So Bitcoin/Dogecoin/... was only 21,2% on day 1 of adding Paypal as payment option.

That's a great point. But it doesn't fully get the big picture.

If you had asked anyone to implement PayPal support 10 years ago, you would probably not experience +370% increase in revenue. It would probably be more like 21,2%.

But because it stuck around and gained traction, it is now a sort of "default" for non-credit card payment. Which explains the 370% figure.

But PayPal is "evil" and we know this. It is a centralized outside your control. It can seize the funds in your account. It can be corrupted by governments. It can be instructed into what it can and can't support by credit-card companies, etc etc.

That not how currency is supposed to work. You own it. You exchange it. You give it to who you like to give it to. Your money is yours to do with as you please.

So we need a new approach which addresses the centralized nature of PayPal and the ownership issue of the funds. And BitCoin does just this!

Today it is 21.2%, but who knows? It may stick around and completely decimate PayPal if it becomes a new "default" for non-credit card payments. After all, if BitCoin is supported and has zero costs and a lower risk, why would anyone need PayPal?

>if BitCoin is supported and has zero costs and a lower risk

That's a big "if". As it is, neither of these things are true.

There's no such thing as "free"; services have to be implemented, infrastructure must be built, systems must be supported. Hopefully Bitcoin will be cheap, cheaper than the alternatives, but it won't be free.

Bitcoin price seems to have settled down recently, which is good for its day to day usage.

Hearing this news makes Bitcoin that much more legitimate. Having Microsoft, a company known for its money and its practices to obtain large amounts of it, accept Bitcoin will affect its value in a big way. Or at least one would believe.

I kind of wish I bought Bitcoins when I heard about it a year or so ago (just like I wish I invested in Facebook). I did read an article explaining Bitcoin. Parts of it made sense, but other parts still left me confused. I wouldn't say that should deter anyone. As many things out there that we want or have, the results of the product is sometimes more important than its inner-workings.

If you had invested a year ago, you would have lost 70% of the money you invested. Consider yourself lucky that you didn't.

Sounds big. Could get the other large tech companies to look into Bitcoin more and evaluate their efforts.

Well, at least it's a step in the right direction?

>You can only use Bitcoin to add money to your Microsoft account and then purchase digital goods at select Microsoft online stores. You can’t use Bitcoin to purchase Microsoft products and services directly at this time.

Bitcoin totally makes sense for digital products, especially for transaction with small amounts. With Bitcoin you can send even $0.01 for a very low fee.

Default fee for a transaction is 0.0001, which is ~$0.0355 at current bitcoin price.

The default relay fee is actually now 1,000 satoshis (0.00001), not 10,000 satoshis (0.0001).

Who is that fee paid too?

Essentially the fee is split up by everyone who is running the nodes that make up the Bitcoin network. The more hash-power you have the larger your share of the fees.

this is incorrect, the transaction fee is paid to the miner that first includes your transaction in a block. this is their incentive for including transactions in blocks.

the miner that includes your transaction in a block. the first miner to do so gets the transaction fee, hence you can pay a high fee and guarantee it is included or pay a standard fee and it will probavly be included in the next 2-3 blocks or if you are not in a rush you can send it with no fee (providing it meets a few other criteria) and it will get processed usually within 24 hours.

the miners are the people that produce new bitcoins and secure the network.

As a reward to the miner of the block, no?

In the current reference clients, transactions smaller than 1000 bytes and less than 0.01 BTC are sent without a transaction fee.

i dont think the value is as important as the transaction size. I can send 10BTC for free, especially if the coins have not been moved for more than say a week. In fact smaller transactions are usually more costly (as a % of the sum being sent) than large transactions, see the recent US marshalls auctin as an example, $30M sent for $0.37.

Microsoft is accepting BitPay, not Bitcoin. It's like saying that Microsoft is accepting checking account payments, because PayPal supports it.

BitPay employee here. Around 50% of our merchants actually accept some or all of their settlement in Bitcoin.

It seems like a logical move. If a company wants to place a bet on Bitcoin, accepting it for services is a better way to acquire it than selling fiat currency on exchanges. By keeping profit margin in bitcoins, companies position themselves for a reward, without exposure to volatility risk.

Avoid the risk of purchasing bitcoin (either through mining hardware, or directly on exchanges), but gain the chance of capitalizing on bitcoin.

This is interesting. Could you give more detailed information? Volume in BTC vs. volume in $?

This was my first thought as well. They have tons of merchants using them, but I don't think a big percentage are high volume. So it could easily be that 50% of merchants keep some bitcoin, but only 2% of volume is kept that way.

Definitely important. A merchant could be an anti-government bead jewelry maker doing $75 a month, or Microsoft. They each count one.

What's the weighted average of that "some"? I doubt if it's above 10%!

What were you expecting, 100%? This is a new technology. Obviously most people are going to be "cautious" about it.

Think about it for a second.

Now look back at Bitcoin 5 years ago and compare where we are today. You're really not putting things into perspective.

New technology? Docker is a new technology, yet, it's embraced by everybody and in production. Don't give lame excuses, please! Bitcoin is the third-grade speculator's paradise.

I doubt you know how Bitcoin works.


Famous last words.

I know you guys are heavy on cliches, which are like clutches for your disabled speech.

> It's like saying that Microsoft is accepting checking account payments, because PayPal supports it.

So it's like saying an accurate thing?

Microsoft is accepting the US dollar, not Bitcoin.

That's silly. That's like saying any brick and mortar small business doesn't accept "credit" because they use a payment processor to process their credit cards. Or that places on the Canadian border don't "accept Canadian currency" because it's immediately exchanged for USD. The fact that not-Microsoft is processing the payment in bitcoins and exchanging it into the currency that Microsoft wants doesn't mean that you can't buy the intended good from Microsoft with bitcoins.

Yours is a reasonable analogy and it works and it's a good point; it doesn't counter the parent comment IMO.

A small business won't accept credit because of the risk, so a third-party will pay the business - for a fee - and take the risk of the credit themselves. The business isn't accepting credit as you point out.

Here MS aren't accepting bitcoins they're accepting the use of a third-party that will pay them in dollars on your behalf.

What's the point of that distinction? Well if MS truly accept bitcoins themselves then they would have holdings in bitcoins rather than in dollars, they would then be [capable of] trading in bitcoin and would legitimise it somewhat. Here they're not legitimising it to any useful degree, they're allowing BitPay to do all the bitcoin elements.

tl;dr - Call me when MS \buy\ something using bitcoins.

companies such as MS want to get involved in bitcoin however they need regulatory clarity to do so. By using BitPay they get to be involved with a modicum of insulation from unclear regulations. I would expect that MS are not taking all of the payment in $ but are keeping some in BTC.

What is meant by "Microsoft accepting bitcoin" is that you can buy things from Microsoft using bitcoin. Customers don't care about the details of currency exchange on the back-end.

Bitcoin seems unstoppable at this point.

We accept credit cards on our website... oh whoops sorry I mean we accept Stripe.

No Microsoft does accept Bitcoin. They then convert the Bitcoin into USD. The distinction is who hires the middleman to convert. If a merchant asked all customers to first go to BitPay, get USD, then come back and give them the USD, then no they don't accept bitcoin. However, if a merchant takes your bitcoin and then gives you the goods, and after the fact finds the middleman themselves and converts, then they accept bitcoin.

Well, tell this to the folks who hold Bitcoin. They love when big merchants start "accepting" Bitcoin, but secretly pray that they won't have much sales as the selling pressure will drag the price down. So, there's a difference as this isn't a highly liquid market. If you pay Microsoft USD via your European credit card, EUR is sold for dollars on the Forex, but given that this is the most liquid market in existence, you're not gonna affect it. On the contrary, we often see on Bitstamp how 100 BTC can drop the price by 5-10% with a weak orderbook. I hope you get my point why there's a practical difference.

You don't need a BitPay account to pay using BitPay. The transaction occurs on the public bitcoin blockchain, from any bitcoin account.

You can pay via PayPal without having a PayPal account as well.

The official announcement is now available, if you want to consider changing the link again.


Ah Silicon Valley's big ponzi scheme. A year ago today a Bitcoin was worth $820, right now one is worth $360. How long until it hits its inevitable price, $0.00, considering it has no value whatsoever? Who knows? As Keynes said, markets can remain irrational longer than you can remain solvent. Marc Andreessen talks about how older people have dot-bomb hangover fears, but nothing screams bubble to me than this modern scam known as Bitcoin. It has all the attributes of a scam as well - the anonymous architect, all the big players running off with the money or getting raided by the police. Yet the big names in the Valley keep touting this worthless ripoff. Plenty of HN'ers are involved in the scam, so this post is sure to get downvoted to oblivion by them.

What we have here on HN is me, who over a year ago when Bitcoin was worth $460 said it was worthless ( https://news.ycombinator.com/item?id=6753545 ), and we also have the scam artists who were hyping it then, are hyping it now etc. The potential Bitcoin investor suckers who listened to me would have saved themselves from losing the $100+ dollars on each Bitcoin they bought since the current price is below $360. I've been prescient, they've been wrong, but they're still running their scam and will downvote me to oblivion - they still have some suckers to fleece. The real thing to note is how hard the big names in the Valley are pushing these hashes that they know to be worthless, which has been surrounded by an architect who hid his identity, and multiple ripoffs and police raids. Supposedly the Valley is about people who have insights that others don't. In this case though, the big names and big money have one insight, this is a scam, and try to hush those pointing that out, as there are still suckers left to fleece.

way to cherry pick your dates, thre were people calling it a scam when I got in at $5, there were people calling it a scam when I encouraged family to get it at around $10. there were people calling it a scam all the way up to the $260 peak and lost more when it dropped from there. People have called it a scam plenty of times and none of them have been right. the value has peaked and troughed and plenty of people have been fortunate to make a lot of money with it and you know what, it is not going away.

Your hypothetical day of a bitcoin worth $0.00 will come when something better replaces bitcoin, not because bitcoin failed against fiat/national currencies, but because it was superseded by a superior product.

Keep in mind that Bitcoin replaces itself all the time, and will continue to do so. It's an open source project that continues to be developed as we speak.

I know i just di not have the time to go into it.

> The potential Bitcoin investor suckers who listened to me would have saved themselves from losing the $100+ dollars on each Bitcoin they bought since the current price is below $360.

What would you have said in 2011?

Gold has no value whatsoever as well. Yet it's considered a commodity. Even money has no value whatsoever. Money is a promise from a government to grant some goods or services. If the government gives up, or its companies close down or leave, or decides to devalue its currency, you lose money regardless.

Commodities are assigned the value humans agree on, according to market. Bitcoin is no different. It's a digital commodity, but a commodity nevertheless. It will have its bubbles, but they are fueled by human greed, not the nature of bitcoin per se.

Gold has no value whatsoever as well.

You mean other than in jewelry and electronics?

Even money has no value whatsoever. Money is a promise from a government to grant some goods or services.

I think you are using a strange definition of "no value".

If you think about what they're implying instead of just being snarky, they're really saying that bitcoin/gold/other monetary commodities have no intrinsic value beyond their a) suitability as exchange technologies and b) broad recognition as desirable.

Another way of thinking this one through would be to say, okay, gold may be desired for jewelery and electronics, but so are many other metals, so why did gold become a principal money and other metals didn't? The answer doesn't have anything to do with gold's desirability for jewelery/electronics - it has to do with gold's: good mix of abundance and scarcity, impossibility to forge, durability, friability, etc.

It's a rhetorical exercise necessary to make people understand that while Bitcoin may just be a bunch of numbers someone invented, the combined decision of humans to value it gives it its real value (facilitated of course by its suitability as an exchange technology.)

No, he's right: Money is a fiat currency. As long as the US government backs paper money, it has perceived value. The moment the Fed stops backing it, it loses its perceived value and becomes only as valuable as its physical contents, i.e. paper and ink, so you could burn it or wipe your ass with it, but you can't eat it.

Let the apocalypse happen and see how valuable that paper money is, along with that bitcoin, and that bank account, and that credit card. That's when real, valuable things like salt, non-perishable food, fuel, certain metals, tools, and so on will have barter value. But the idea of a currency will (for a time at least) go away under those circumstances. Modern wealth is really a very fragile construction when you think about it; it's all just perceived value in the end.

Money represents work. When you do work, you get money. When you want work done, you give money to someone else. That's fundamentally what our economy runs on. You could argue that some people take advantage of this on the top, but the vast majority of any economy is based on people doing work. The dollar is backed by the US government. When you go to a store and say you want to buy something, they have to take your money. In fact it's illegal for someone to not accept legal tender. That is the value of the dollar.

So now you say, but the US government isn't anyone special. Countries come and go in dominance, why is the dollar worth more than any other currency? Because their really is no other country with which everyone else wants to trade with on a massive scale. Americans are willing to give more money for work than any other country, so it is in other countries best interest to take dollars, which in turn increases the demand for said dollar.

Wouldn't it be useful for a digital currency like bitcoin to replace all of that? Not really, unless it has actual ties with actual money. A digital currency's only real value is being able to send and receive money, fast. But once it gets wherever, it still has to be converted back to the local currency. Gold and other commodities have physical values with physical properties than can physically do things. That in itself makes them have a base value, when they go up or down, that's just the market being the market.

You could start talking about how more companies (like Microsoft) are accepting bitcoin, so potentially you'll never have to convert it back to local currency but that conversation leads to the dollar being essentially worthless and the US government could collapse any minute and you should save all your money in bitcoin. Which sounds stupid and goes into pump-and-dump territory.

> Money represents work. When you do work, you get money.

If that were 100% true, I could make more money digging ditches than your average mid-level manager. But it's not that simple.

> In fact it's illegal for someone to not accept legal tender.

Bullshit. From the Federal Reserve's website[1] (emphasis mine):

"Section 31 U.S.C. 5103, entitled "Legal tender," states: "United States coins and currency [including Federal reserve notes and circulating notes of Federal reserve banks and national banks] are legal tender for all debts, public charges, taxes, and dues."

This statute means that all United States money as identified above is a valid and legal offer of payment for debts when tendered to a creditor. There is, however, no Federal statute mandating that a private business, a person, or an organization must accept currency or coins as payment for goods or services. Private businesses are free to develop their own policies on whether to accept cash unless there is a state law which says otherwise."

[1] http://www.federalreserve.gov/faqs/currency_12772.htm

I think that the only restriction is relative to taxes. You can only pay taxes in the legal tender, and since you have to pay taxes in any transaction even if the transaction is made in a different form of payment, it is convenient to have the transaction itself to happen in the local currency.

Taxes are an issue, but the other big things are:

(1) A tender of payment of a debt in legal tender currency, with some caveats and provisos, fulfills the obligation under the debt whether or not the person to whom the debt is owned wants to accept the currency, which has an effect if that person later tries to enforce the debt through the courts.

(2) If a US court awards damages, even if the injury consisted of deprivation of some other currency than the legal tender currency, it is going to award them in dollars. If the currency you actually hold is something else, you'll have to trade it for dollars to satisfy the debt thus created, unless the other party is willing to enter into an agreement to accept the other currency as a substitute.

>Money represents work. When you do work, you get money.

Yet the people with the most money get that way by minimizing the amount of work they have to do?

Money _should_ represent the _value_ of decision-making exchanges. It represents whatever it takes to overcome barriers to cooperation and communication. You might call that 'work', but that's a very narrow view of the matter. Anytime someone overcomes a barrier to communication or cooperation, they are producing value.

_Most_ of this value is not captured by any monetary system, and in fact, most of our monetary systems capture biased and unrepresentative portions of that value, and thus can be manipulated far easier than desired.

It has nothing to do with 'work.' Manipulating measures of value doesn't overcome barriers, it reinforces them. Creating unnecessary obstacles for people is not valuable, even if people are payed to do it, despite the fact that it is work.

> Money represents work.

Government money represents debt, not work, that's why it's called IOUs. And I wouldn't say actual money (eg: gold, Bitcoin) represents something. It's just a resource useful for trading and saving, because it has certain properties like scarcity, fungibility, etc. 1 Bitcoin doesn't represent $354 US dollars of work in 2014. 1 Bitcoin represents 1 Bitcoin, if anything.

> When you do work, you get money.

So what happens when you don't work and you get money? Fatal error? What does the new money printed by the government every year represent?

> That's fundamentally what our economy runs on.

No, that's just what the owners of the world taught you through the education system they regulate.

> In fact it's illegal for someone to not accept legal tender.

No, its not illegal not to accept it (that is, the law does not punish failure to accept a tender of payment made in the currency designated as legal tender), however, the tender of payment in such currency may discharge the debt whether or not it is accepted, which would leave the party failing to accept the payment without any recourse through the legal system to collect the debt in the form it would prefer.

You don't need the apocalypse. You just need a monetary change, such as the one Europe did. By moving to the euro, all national currencies were becoming effectively worthless, redeemable in euros at a fixed exchange rate. Now, they are worthless.

> You mean other than in jewelry and electronics?

Again, it's perceived and agreed value. Gold is valuable because we decided it is. Jewels are as valuable as the fashion agrees them to be. In fact, you can find jewels worth thousands of dollars that are made of steel. Their intrinsic value for the material is a few cents.

> Even money has no value whatsoever. Money is a promise from a government to grant some goods or services. I think you are using a strange definition of "no value".

What I mean is that the value is just what the system agrees on. If the system decides that the US are insolvent, or can't back their currency (which is a _promise_ to deliver) its value goes down, potentially to the value of the paper it's printed on.

In the end, the value of something depends on what people agree it's backing in terms of goods and services. It's an agreement, a child's game among adults, and can change in a whim.

> You mean other than in jewelry and electronics?

What % of Golds value do you think is based on usage in jewelry and electronics? Hint, not much.

66% isn't a lot?

"In 2010, jewelry accounted for approximately 54% percent of gold demand, which totaled 3,812 tonnes, according to the World Gold Council and The London Bullion Market Association. ... Another 12% of demand is attributed to medical and industrial uses for gold, where it is used in the manufacturing of medical devices like stents and precision electronics like GPS units."


He never said what amount of gold goes into jewelry, which your source gives (the demand). His point was not the demand, but the value of gold associated with its use in jewelry or electronics (which I would argue is also high, but that's just my opinion).

I downvoted - not because it's against Bitcoin, but because it's written like an absurd breathless hit piece. Every other word is scam, scheme, bubble, hype, fleece, ripoff, raid, etc, yet there are no meaningful examples of how it is any of those things. Let's at least try to make insightful points on here, and leave the hits and puffs for the mainstream media.

Guidelines | FAQ | Lists | API | Security | Legal | Apply to YC | Contact