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Comment by netcan | Hacker News Reader

Do you think a bitcoin based payment processor where you can pay with bitcoin or with credit card (processor converts to bitcoin behind the scenes) would have any advantage? Would it be enough of an advantage to incentivise bitcoin use (eg avoiding conversion costs)?

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You would have to offer a discount for paying with bitcoins for this to work. I know a lot of merchants (in real life, not online) that offer small discounts to people who use cash so that they don't have to pay credit card transaction fees.

In any case, if you accept online payments via credit card, there wouldn't be much point to converting them to bitcoins after the fact, unless you actually prefer to hold BTC instead of USD. You've already paid the transaction fees.

The point (in my mind) is to make it entirely bitcoin from the merchant perspective. They can set prices in bitcoin, buy stock in bitcoin, etc.

The other option is the less radical add a bitcoin payment option. This is basically just using bitcoin as a payment method rather than a currency.

Maybe a useful service would look like this: send BTC to any address, pay by credit card. That way shops could go BitCoin only, and people who don't want to bother setting up a bitcoin wallet could simply use that service to pay by credit card.

The question then becomes 'why would/ what would make merchants want this?'

If merchants are using btc themselves, it becomes trivial for people to want to use btc to trade with them. Are there any non shady reasons for preferring btc though? Why would you want to accept a volatile new currency when all your expenses are in a different currency?

The more I think about it the more I think that btc will need to bootstrap from some sort of tangent: goofy investment medium, payment processing technology, gray markets...

Might become the currency of the underworld.

For example because you could accept BitCoin right now. No hassles with trying to get some payment provider to accept you as a legitimate business. Fees might be lower, too.

I could if I wanted bitcoin and if my customers had bitcoin. Realistically though it's going to amount to my customers buying bitcoin to pay me and then me converting immediately back into hard currency. So, we'd both pick up some fees along the way. Prices would nominally be set in some other currency, probably the same currency as my expenses.

That's not really a currency. It's a payment processing service.

I guess it has to go through this sort of thing while its small.

I suppose making it easier to user bitcoin would incentivise it's use. At the moment accepting BitCoin payments probably has the advantage that lots of people are eager to spend BTC on real things. That effect might not last, though.

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