Bitcoin News
Daily diary of what's happening with Bitcoin.
Through daily posts by Forbes writer Kashmir Hill (@KashHill) we learn how far Bitcoin as a payment system has come along. Her assignment ais to live on bitcoin for a week — without spending any dollars. Excerpts from Day 4:
“[Bakery owner] Jennifer Longson is there, wearing a cupcake apron, filling cupcake tins with fresh batter along with two employees. She says I’m the second customer of the day asking to pay in Bitcoin.”
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“Cups and Cakes [receives publicity] as one of the first stores to accept the currency. Her little shop has been featured in international news: on the BBC, in the Financial Times, on NPR Marketplace, and beyond.”
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“Longson is surprised that I’m able to use my Blockchain iPhone app to scan her QR code and make the payment. “When you update your iOS, you’re going to lose that,” she says. ‘Apple has blocked it.’”
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“[Market owner Adam Sah] didn’t want to take the currency risk with the Bitcoin I paid him so he paid it out the same day to Name Cheap, the company which provides their domain name services (and accepts Bitcoin). ‘I paid our fee for the year with it,’ he says. ‘More and more IT services accept Bitcoin. […] With all these new things, you have a bunch of early adopters who experiment,’ he continues. ‘Then there’s a crossing of a chasm and then it becomes mainstream.’”
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“‘As a retailer, I am salivating over the idea of having this silently competing with credit cards and their fees and the hidden cost of dealing with cash: counting it, the fee I pay to Wells Fargo for a business account, transferring it,’ [said Sah]”.
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“When I go to bed, Bitcoin is valued at $96; by Saturday, it is shooting back up in value.”
- http://onforb.es/10eKkXe (Day 4)
- http://onforb.es/Zszg8U (Day 3)
- http://onforb.es/ZYlttF (Day 2)
- http://onforb.es/10VXn6b (Day 1)
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TechCrunch’s Drew Olanoff (@Drew) had the scoop on Reddit’s announcement that they were accepting bitcoins as payment when its users purchase Reddit Gold. Excerpts:
“Social discovery and discussion site Reddit has just launched an integration that allows its users to pay for ‘Reddit Gold’ using bitcoin with Coinbase’s system.”
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“By buying Reddit Gold, you can add features to your account like comment highlighting and shutting off ads.”
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“Brian Armstrong, Coinbase’s CEO, [shared] about the launch: ‘This is a large step forward for Bitcoin and for Coinbase, as Reddit is a top 100 site in the U.S. and top 200 site internationally. […] We had a number of other merchants start using our merchant tools recently, including 4Chan, web hosting companies, productivity app, and plenty of sites accepting donations.’”
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“[Coinbase] says it has 30,000 users and is processing 40,000 bitcoin payments a month.”
- http://tcrn.ch/12lHkxR
- http://bit.ly/Z0AjgZ (Announcement/blog post on Reddit)
- http://bitcointalk.org/index.php?topic=144102.0 (Further discussion of this development)
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Joe Cascio (@JoeCascio) describes in a blog post reasons why Coinbase is reporting an “overwhelming response” to their wallet and exchange service. Excerpts:
“I have found it to be the simplest, lowest cost, if not the fastest alternative for online purchasing I have tried.”
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“They use convenient and very low cost ACH transfers to withdraw money from a bank account you designate to buy bitcoin, or into which to deposit money when you sell bitcoin. Because of the ACH transfer, it currently requires a US bank account.”
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“When I input an order to buy, I’m told exactly how much will be deducted from my bank and I’m notified by email when the order completes. I can monitor the progress of the order on the site and even cancel uncompleted orders if necessary. There are no flaming hoops to jump through, no other ‘surprise’ services or fees involved.”
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“I have been experiencing 3 or more business days delay between placing an order and having the bitcoin I purchased be available to me. This is due to the ACH transfer time and the old, creaky traditional banking system.”
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“‘We definitely want to raise those limits, and will most likely do so in the next 2-3 months [… but] after your first trade completes successfully you can do $100 each day, even if the previous ones have not completed yet. [quote from Coinbase CEO Brian Armstrong]”.
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Bitcoin Money blog (@BitcoinMoney) gives a monthly wrapup on Bitcoin for the month of October, 2012. Excerpts:
“The closing price of $11.20 USD was down more than a dollar from the previous month’s close resulting in a nearly 10% drop for the month. For 2012, where the price opened at a $4.72 level, the price rise from January 1st is now at the level of 137%.”
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“What might be surprising is that the month ended down just 10% after the disaster that October 2012 essentially was for the Bitcoin ecosystem as a whole.”
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“A promise of relief arrived with the announcement of Bitcoin-Central’s BTC/GBP market. Further relief arrived with Blockchain.info/wallet’s Instant Online Bank Transfer which is now available in the UK and elsewhere in the EU.”
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“Emerging during the darkest part of the shutdown storm was Coinbase’s launch of its BTC/USD exchange. This allows a Coinbase user to make bitcoin purchases paid for with funds drawn from the user’s bank account.”
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“Banking issues were just one challenge for the exchanges as heavy distributed denial-of-service (DDoS) attacks took many exchanges down at one point or another during the month.”
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“The current development focus is on resolving the immediate scalability issues that exist when running a full Bitcoin.org client node. Significant progress with this occurred in October when the ultraprune capability was merged into mainline — a prerequisite to it being included in a future release.”
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“The 230,400 bitcoins issued which Bitcoin miners took in during the month is valued at $2.70 million using the average daily valuation for the month of $11.72. Miners fared less well in October as the result of a rising difficulty — 15% higher at the end of the month versus the level at the beginning as well as the decline in the exchange rate.”
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“Later this month, at block 210,000, the block reward mining subsidy drops by half. This halving of the amount of currency issued means miner’s revenues will drop in half as well.”
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“The herd-like mentality of speculators means that demand can disappear in an instant and a deep selloff can result. Twice during October were cliff dives of 15% or more.”
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“A significant indicator that Bitcoin has the potential to become much more widely used surfaced with the ECB’s policy brief on Virtual Currency Schemes. The 55-page brief describes Bitcoin as having the potential to have a negative impact on central banks.”
- http://www.bitcoinmoney.com/post/34853623626
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A post on Bitcoin Money blog (@BitcoinMoney) describes the new “linked bank account” feature from Coinbase (@Coinbase). Excerpts:
“Coinbase, the Bitcoin startup that aims to make Bitcoin as easy to use as PayPal, just took a big step closer to reaching their goal.”
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“Coinbase’s ‘linked bank account’ feature which provides an easy way for those in the U.S. to buy bitcoins and have the funds come directly from a linked bank account. Additionally, proceeds from cashing out bitcoins are paid out directly as an ACH/direct deposit bank transfer.”
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“[This linked account provides] buying power instantly without having to wait for the funds to first transfer. The coins that are purchased cannot be withdrawn until the bank transfer completes but the price paid is locked in at the time of purchase.”
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“The service is limited for now to $100 per purchase, but Coinbase expects to increase this once they confirm they are sufficiently preventing abuse (read fraudulent ACH transfers) — something that has either dogged or killed every other exchange that has tried.”
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“‘Down the road’ Coinbase would like to expand the service to its customers outside the U.S. as well.”
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“This improved method for getting coins will allow Bitcoin’s reach to widen significantly.”
- http://www.bitcoinmoney.com/post/34370468102
- http://blog.coinbase.com/post/34357253898
- http://bitcointalk.org/index.php?topic=120720.0 (Further discussion on this development)
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Joel Falconer (@JFalconer) stands out among his peers by penning unbiased, objective reports on Bitcoin developments. He published his latest, which appears on TheNextWeb.com. Excerpts:
”Developer and Bitcoin evangelist Julian Noble pointed out, in an interview with TNW, a number of legitimate ways Bitcoin is currently being used in transactions. Virtual private networks, legal online gambling, Bitcoin mining equipment and even tea make the list. He notes that Roger Ver of memorydealers, a computer parts dealer, has indicated that he uses Bitcoin to pay suppliers in China.”
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“Moving money from country to country by an international money transfer not only exposes parties to risk as exchange rates fluctuate but can take up to 10 days to get from point A to B. Bitcoin would make the process incredibly fast and that would fix many problems with payment delays.”
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“’The single most important event is for a government like the US to issue a statement regarding how Bitcoin will be treated legally. Once companies know the legal status of Bitcoin – whether it will be treated as a currency, a commodity, or something new – that will then enable them to really dive into it and utilize the currency for their benefit,’ says [BitInstant’s Erik Voorhees].”
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“We’ve entered an age where we are seeing startup incubators and venture capitalists plunge American dollars into ventures that will serve the Bitcoin economy.”
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“[Bitcion is] anything but dead. It’s growing, and the ecosystem around it is growing too. With BitInstant, we’re going to see greater integration between traditional currencies and Bitcoin. With Coinbase, we’re seeing a confusing process made simple. More merchants and more consumers are signing up every day, and more value is being traded in the system all the time.”
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“You might not like Bitcoin, but it’s not going away.”
- http://tnw.co/RBdvi5
- http://bitcointalk.org/index.php?topic=105504.0 (Further discussion on this article)
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