Using Bitcoin for hobby transactions instead of PayPal

[toxicboy27]

Hi forum,

What are your thoughts on using Bitcoin for payments?
Fees are minuscule compared to PayPal.
Seems like people in the hobby haven't started to use it due to various factors. Imo it is superior to all other methods if you are dealing with a person you have dealt with before. Bitcoin transactions are sent to a wallet which can be verified to the public so that when you are sending Bitcoin there's no denying that an amount has been received or not. The risk is that you might send Bitcoin to an untrustworthy person who has created or assumed a fraudulent identity with criminal intentions.
Anyhow there is a ton of resources on learning more on Bitcoin including how to use it and info on how it actually works. I think it's about time more hobbyists consider it as it really is the future and many people are starting to get into it. Early adoption by people here may be akin to those who were early adopters of using eBay, PayPal and the Internet for trading.

Poll and additional questions: Have you used it before? What are some of your concerns or questions about it?

[puck419]

It's pretty much sending it as paypal gift with fees. Once its sent your out of luck if something happens.

[WaiverWire]

It's pretty much sending it as paypal gift with fees. Once its sent your out of luck if something happens.

this ^^^^^^^^^

[tke1600]

Hi forum,

What are your thoughts on using Bitcoin for payments?
Fees are minuscule compared to PayPal.
Seems like people in the hobby haven't started to use it due to various factors. Imo it is superior to all other methods if you are dealing with a person you have dealt with before. Bitcoin transactions are sent to a wallet which can be verified to the public so that when you are sending Bitcoin there's no denying that an amount has been received or not. The risk is that you might send Bitcoin to an untrustworthy person who has created or assumed a fraudulent identity with criminal intentions.
Anyhow there is a ton of resources on learning more on Bitcoin including how to use it and info on how it actually works. I think it's about time more hobbyists consider it as it really is the future and many people are starting to get into it. Early adoption by people here may be akin to those who were early adopters of using eBay, PayPal and the Internet for trading.

Poll and additional questions: Have you used it before? What are some of your concerns or questions about it?

The reasons I haven't got into bitcoin yet:

1. Unregulated; how to claim or keep track for taxes?

2. Once you hit send its gone so scammers could have a field day.

3. The value fluctuates like a stock minute to minute.

[toxicboy27]

The reasons I haven't got into bitcoin yet:

1. Unregulated; how to claim or keep track for taxes?

2. Once you hit send its gone so scammers could have a field day.

3. The value fluctuates like a stock minute to minute.

1. It would be similar to tracking stock/foreign currency purchases. I believe the IRS treats Bitcoin as an investment so you need to track your buy / sell costs in terms of dollars and this is fairly simple. Lots of resources can be googled on this matter.

2. I recommend using it for dealings with reputable trading partners and only using it for amounts which no reputable member would risk tarnishing their reputation for.

3. There are a few major exchanges such as coinbase or poloniex where you can lock in the usd amount and actually get the cash into your bank account faster (and with much less commissions) than currently adopted methods such as PayPal.

[tennelson55]

The reasons I haven't got into bitcoin yet:

1. Unregulated; how to claim or keep track for taxes?

2. Once you hit send its gone so scammers could have a field day.

3. The value fluctuates like a stock minute to minute.

Sounds like my type of scamming system; oh wait did I just say that out loud?

The only reason I've heard of using it is that it can be untraceable.

[Branesergen]

1. It would be similar to tracking stock/foreign currency purchases. I believe the IRS treats Bitcoin as an investment so you need to track your buy / sell costs in terms of dollars and this is fairly simple. Lots of resources can be googled on this matter.

2. I recommend using it for dealings with reputable trading partners and only using it for amounts which no reputable member would risk tarnishing their reputation for.

3. There are a few major exchanges such as coinbase or poloniex where you can lock in the usd amount and actually get the cash into your bank account faster (and with much less commissions) than currently adopted methods such as PayPal.


1. So now not only can my card tank overnight but so can my payment method. Yes, drastic but can and does happen. On the flip side it could very well double overnight too but risk vs reward here = too volitale.

2. People have ruined their rep over $10 before. And in such a volitale market could actually be deemed easier. *buys Mike Trout /10 auto for 1 bitcoin (roughly $900)* wake up to bitcoin being $500 *seller - yeah I'm not sending the card now*

3. PayPal is next day transfer for free - what's better than that? Instant? Taking an investment as payment it would need to be.

[SteveO21]

My vote is

I have NOT used it because I'm extremely skeptical about it and feel that it's significantly less safe than other payment methods.

[istheskyblew]

I have used bitcoin (both as a buyer and a seller) for the past couple of years for other transactions on other forums for different hobbies, so yes it could easily be done here. Like others have said it's pretty much like sending via PP gift so I usually only do it with members who have great feedback and are active.

[rats60]

Sounds like my type of scamming system; oh wait did I just say that out loud?

The only reason I've heard of using it is that it can be untraceable.

I guess that is why drug dealers love it. I prefer to stick with an above board payment system.

[toxicboy27]

It's very interesting and valid all the points everyone has made here and I thank you for your contributions thus far.

I think there are a lot of misconceptions about bitcoin and that these will be lessened over time as bitcoin and other solely digital currencies become more widely implemented.

Governments in countries like China and Japan are beginning to implement their own forms of these currencies so in the near future it might become commonly used here as well. Actually I would argue that it already is commonly used by those who have used it frequently for themselves as some experience using it will quickly reveal to the user that it is much more efficient in speed, costs and transparency when done in a secure manner.

People who state that it can be used by scammers and other criminals effectively are correct to say so, but they do not acknowledge that all other users of bitcoin also benefit from its use as well.

As for the volatile nature of bitcoin, you can actually send it to many exchanges such as poloniex and coinbase and lock in your rate in USD quite easily and rapidly.

Another misconception about bitcoin is that it is untraceable. Actually, bitcoin is often mistaken for being a crypto currency as it is perceived to be untrackable, but in reality it is one of the most transparent of all digital currencies as every transaction is stored on a public ledger (blockchain.info) and with the bitcoin address any person in the world can see the transactions which have gone in and out of that address. It is not anonymous except in the sense that the bitcoin address does not store personal information of the owner of that bitcoin wallet address.

For the issue of sending bitcoin for transactions being essentially sending paypal gift with no recourse to the person sending the bitcoin, there are actually escrow services that can be used. In the future, more alternatives to protect buyers will surely emerge also.

To those who are comfortable with the present methods of transacting (via Paypal primarily I'm assuming), I ask you would you still use their service if instead of paying the current 2.9% incoming transaction cost when you could be paying potentially 1/10th or less somewhere else for the same service?

Perhaps it's not the right time for Bitcoin yet and perhaps its day for it's widespread use in this hobby will never come.

[duron]

I think there are a lot of misconceptions about bitcoin and that these will be lessened over time as bitcoin and other solely digital currencies become more widely implemented over time.

Agreed.

Still, def not viable in this realm since others are saying it behaves like paypal gift.

[jcardstore]

It's very interesting and valid all the points everyone has made here and I thank you for your contributions thus far.

I think there are a lot of misconceptions about bitcoin and that these will be lessened over time as bitcoin and other solely digital currencies become more widely implemented over time.

Governments in countries like China and Japan are beginning to implement their own forms of these currencies so in the near future it might become commonly used here as well. Actually I would argue that it already is commonly used by those who have used it frequently for themselves as some experience using it will quickly reveal to the user that it is much more efficient in speed, costs and transparency when done in a secure manner.

People who state that it can be used by scammers and other criminals effectively are correct to say so, but they do not acknowledge that all other users of bitcoin also benefit from its use as well.

As for the volatile nature of bitcoin, you can actually send it to many exchanges such as poloniex and coinbase and lock in your rate in USD quite easily and rapidly.

Another misconception about bitcoin is that it is untraceable. Actually, bitcoin is often mistaken for being a crypto currency as it is perceived to be untrackable, but in reality it is one of the most transparent of all digital currencies as every transaction is stored on a public ledger (blockchain.info) and with the bitcoin address any person in the world can see the transactions which have gone in and out of that address. It is not anonymous except in the sense that the bitcoin address does not store personal information of the owner of that bitcoin wallet address.

For the issue of sending bitcoin for transactions being essentially sending paypal gift with no recourse to the person sending the bitcoin, there are actually escrow services that can be used. In the future, more alternatives to protect buyers will surely emerge also.

Perhaps it's not the right time for Bitcoin yet.

Decided to respond to this because I am pretty passionate about Bitcoin as a digital currency.

In regards to the sports card / collectible market there is no benefit of using bitcoin. There are far more cons than pros. In fact, I can't think of any real pro to using bitcoin other than it's a different form of currency.

You're downplaying the buyer protection aspect of it but that's the whole point of this not being a smart method of goods transfer. Would you ever do a 4, 5 figure transaction with no protections at all even if you knew the person very well? I sure wouldn't.

A few things I'd also like to address.

-- Bitcoin is no faster than a Paypal payment. In fact in most cases it is slower because it has to be verified against the block chain.

-- There are fees associated with sending / receiving bitcoin determined by the exchange which could end up being more than paypal.

-- Bitcoin transparency can easily be circumvented. I can run all my coins through a tumbler and you'd never be able to trace them.

-- If you have a BTC wallet on your PC and your hard drive breaks down one day, you can kiss all your bitcoin goodbye


All in all bitcoin is not a very good method for purchasing physical goods because there is absolutely NO buyer protection. I seriously doubt there will ever be any buyer protection because then there would need to be an entity that regulates transactions and that's against the entire point of having bitcoin.

It's not the right time right now considering there is no real benefit to using it and I suspect it never will be, at least not for the majority.

[6celtics33]

I can't even imagine what the member feedback section on here would look like if this took hold

[IronMonkey415]

People will be ripping off each other day and night

[toxicboy27]

Decided to respond to this because I am pretty passionate about Bitcoin as a digital currency.

In regards to the sports card / collectible market there is no benefit of using bitcoin. There are far more cons than pros. In fact, I can't think of any real pro to using bitcoin other than it's a different form of currency.

You're downplaying the buyer protection aspect of it but that's the whole point of this not being a smart method of goods transfer. Would you ever do a 4, 5 figure transaction with no protections at all even if you knew the person very well? I sure wouldn't.

A few things I'd also like to address.

-- Bitcoin is no faster than a Paypal payment. In fact in most cases it is slower because it has to be verified against the block chain.

-- There are fees associated with sending / receiving bitcoin determined by the exchange which could end up being more than paypal.

-- Bitcoin transparency can easily be circumvented. I can run all my coins through a tumbler and you'd never be able to trace them.


All in all bitcoin is not a very good method for purchasing physical goods because there is absolutely NO buyer protection. I seriously doubt there will ever be any buyer protection because then there would need to be an entity that regulates transactions and that's against the entire point of having bitcoin.

It's not the right time right now considering there is no real benefit to using it and I suspect it never will be, at least not for the majority.

Thank you for you post and your points.

I disagree with your statement that there are no benefits to using bitcoin in this hobby and have provided some reasoning already but will address each point that you have made to promote further discussion.

#1 - Bitcoin (BTC) transactions speeds vary depending on the need of the transaction (you can pay via low-priority, economic and high-priority methods) and these can improve transmission speeds at an additional cost which is still extremely cheap compared to PayPal (PP). It might not be instant compared to PP, but the technology is constantly being updated and improved upon. I have not even got into other digital currencies such as Ether which are miles ahead of BTC in terms for speed and costs also but just use the former digital currency as an example as it is more mainstream currently.

#2 - If you use the mainstream exchanges your fees will not be greater than PP when you withdraw amounts greater than $1000 at a time to your bank account. You can sell your bitcoin at market rate with an exchange fee of 0.25% at Poloniex for Tether-USD which can then be withdrawn directly into your bank account from tether.to for the greater of 0.1% or $20 USD. Somebody receiving PP for $5000 will be paying $150 to get the money into their usd account whereas somebody receiving bitcoin will only pay $35 or less. The greater the amount the greater rate the savings become, as opposed to PP, where the rate of 2.9% is fixed and can become huge.

#3 - Bitcoin wallets still store and reveal whatever amounts have gone in and out of an address regardless of how much you tumble it in between. Therefore, if a reputable seller provides a public bitcoin address to a buyer, and the buyer sends BTC to that address from their own wallet, this can always be shown to have occur. For transactions I always send a trivial amount first such as $1 dollar worth, have the counter party confirm that this has been received, then send the rest after.

#4 - There is buyer protection if you use an escrow service. Right now PP is essentially acting as this service but is charging over 2% for this service, and this is not even including the potential additional currency conversion costs and what Ebay takes which is ridiculous as it is. The market is recognizing this monopoly by PP and Ebay and in time will offer better solutions which protect the buyer at a lower cost.

I do not disagree that this might not be the right time for Bitcoin, but suspect that in time people will realize how much money can be saved in fees for the same service.

[jcardstore]

Thank you for you post and your points.

I disagree with your statement that there are no benefits to using bitcoin in this hobby and have provided some reasoning already but will address each point that you have made to promote further discussion.

#1 - Bitcoin (BTC) transactions speeds vary depending on the need of the transaction (you can pay via low-priority, economic and high-priority methods) and these can improve transmission speeds at an additional cost which is still extremely cheap compared to PayPal (PP). It might not be instant compared to PP, but the technology is constantly being updated and improved upon. I have not even got into other digital currencies such as Ether which are miles ahead of BTC in terms for speed and costs also but just use the former digital currency as an example as it is more mainstream currently.

#2 - If you use the mainstream exchanges your fees will not be greater than PP when you withdraw amounts greater than $1000 at a time to your bank account. You can sell your bitcoin at market rate with an exchange fee of 0.25% at Poloniex for Tether-USD which can then be withdrawn directly into your bank account from tether.to for the greater of 0.1% or $20 USD. Somebody receiving PP for $5000 will be paying $150 to get the money into their usd account whereas somebody receiving bitcoin will only pay $35 or less. The greater the amount the greater rate the savings become, as opposed to PP, where the rate of 2.9% is fixed and can become huge.

#3 - Bitcoin wallets still store and reveal whatever amounts have gone in and out of an address regardless of how much you tumble it in between. Therefore, if a reputable seller provides a public bitcoin address to a buyer, and the buyer sends BTC to that address from their own wallet, this can always be shown to have occur. For transactions I always send a trivial amount first such as $1 dollar worth, have the counter party confirm that this has been received, then send the rest after.

#4 - There is buyer protection if you use an escrow service. Right now PP is essentially acting as this service but is charging over 2% for this service, and this is not even including the potential additional currency conversion costs and what Ebay takes which is ridiculous as it is. The market is recognizing this monopoly by PP and Ebay and in time will offer better solutions which protect the buyer at a lower cost.

I do not disagree that this might not be the right time for Bitcoin, but suspect that in time people will realize how much money can be saved in fees for the same service.

You make some excellent points.

The Bitcoin confirmation will never be instant like Paypal. You have to pay a fee to use the higher speed service which just adds to all the other fees you have to pay which I will list out below. It'll end up being comparable to PayPal fee-wise when you add it all up.

You're going to pay the following fees. BTC transfer fee, High speed fee, Escrow fee, BTC/USD exchange fee, withdrawal fee. All those add up and might even out for huge dollar amount deals but you're going to lose out on small money sales.

The biggest problem I have here is exchange security and insurance. PayPal has a massive security infrastructure and the resources to maintain it. These exchanges are essentially mom and pop shops with shoddy security.

[WaiverWire]

1. One of the reasons paypal works in this hobby is that most of the people in this hobby have a paypal account. This is an argument against bitcoin, because even if it is "easy to setup" people don't want to have to create new bitcoin accounts and educate themselves on a brand new currency.

2. Taxes are a pain in the neck with cryptocurrencies. So instead of tracking the cost basis of just the card buy price and sell price, you also have to track the cost basis of your currency? Total waste of time.

3. The crypto industry is still immature and accounts/wallets are relatively easy to "lose." Sometimes it's because there are problems with the vendor (MtGox), and sometimes it's because you lost your phone that had the 2 factor authentication (2FA), and yet again it is because the vendor has been moved/migrated to a different company. That's assuming you aren't storing things locally or and that you aren't losing your private keys.

4. Cryptocurrency companies are not known for excellent customer service. It can be multiple days/weeks before you get an email response from customer service.

5. As a buyer, I like the security I get from using my credit card via PayPal via eBay. If something goes wrong, I can file a claim with eBay, or with PayPal, or I can call up my credit card company. If a buyer told me they wanted me to pay with cryptocurrency, I would say no.

6. There are a whole separate set of costs associated with cryptos. Even though sending the money doesn't cost that much. There are fees associated with changing the money back and forth into dollars, and not all banks work with crypto companies.

[toxicboy27]

Really great and valid points by everyone. I find it interesting that so far about 20% of respondents to the poll have ever used it. Perhaps it is still too early for Bitcoin or other digital currencies to be used in the hobby, but if the day comes when security can be assured then people might make the migration as the fees can make it advantageous to switch over in certain situations (ie. for all withdrawals of $1000 or greater).

Thank you for all your contributions everyone!

[Branesergen]

We're already using digital currencies in 95% of all our transactions. From direct deposit, to debit cards, to paypal. Everything is done digitally. There is no reason to use any other form of digital currency. Yes people will use it, I wouldn't mind getting into it myself, but there really is no need to outside of the investment aspect of it. The only way it will ever be bitcoins time is if the world adopts 1 currency. Outside of that I don't see any country going straight digital.


What do you use bitcoin for? and Why?

[SteveO21]

We're already using digital currencies in 95% of all our transactions. From direct deposit, to debit cards, to paypal. Everything is done digitally. There is no reason to use any other form of digital currency. Yes people will use it, I wouldn't mind getting into it myself, but there really is no need to outside of the investment aspect of it. The only way it will ever be bitcoins time is if the world adopts 1 currency. Outside of that I don't see any country going straight digital.


What do you use bitcoin for? and Why?

Because it became "a thing" a few years ago and some people are still holding on to the hope that they'll be right about it.

[toxicboy27]

We're already using digital currencies in 95% of all our transactions. From direct deposit, to debit cards, to paypal. Everything is done digitally. There is no reason to use any other form of digital currency. Yes people will use it, I wouldn't mind getting into it myself, but there really is no need to outside of the investment aspect of it. The only way it will ever be bitcoins time is if the world adopts 1 currency. Outside of that I don't see any country going straight digital.


What do you use bitcoin for? and Why?

I use bitcoin for various reasons some of which have already been described, but others I will describe in this post. One of my points of creating this thread was because I want to promote the idea of using it for this hobby as I feel it is superior to the currently used methods for transaction and would rather transact with it and other digital currencies than PayPal. It is cheaper, and more efficient, and less reliant on a single company. I feel that PayPal has monopolized the industry and holds too much influence which is ultimately not necessary as there are better alternatives out there. I have in one of my previous posts demonstrated the dramatic savings in fees which can be easily acquired if people are using bitcoin to make withdrawals to their bank account of any amount of $1000 or more (it's slightly less than paying 25% of fees compared to the current rates from PayPal btw).

Another reason I have not mentioned so far in my posts is of the appreciating asset value of Bitcoin compared to the the USD. As a Canadian, when I get paid in USD through Paypal, I end up getting stuck with currency conversion charges, long processing times, and a loss of opportunity value because ultimately I want to be holding a digital currency like Bitcoin as opposed to the USD. I question, why do I have to get paid in PayPal when there's a better alternative out there? For the previous post above me where it is claimed that people are still holding on to the "hope" that they'll be right about it, all you have to do is look at the price of it for the last few years to realize that those people have been right about it!

I think that most people do not yet realize that Bitcoin and other digital "currencies" are actually not just limited to being currencies, but instead they are rather a new class of state of the art decentralized technologies (as opposed to traditional centralized models which have many vulnerabilities and limitations) which have been gradually gaining hold in the world in virtually every industry and not just in currencies. Look at how governments now manage themselves, trends in healthcare, the internet, or any globalized industry for that matter to see that the prevailing trend has been to recognize the interests of the consumer by decentralizing themselves and provide products which are selected by them based upon factors which are in play in a market economy (providing best product for best price). While Bitcoin isn't completely decentralized and in many ways there are other even newer technologies which are and are actually gaining a lot of ground on Bitcoin.

Anyhow it's interesting and beneficial for a dialogue to be opened on this subject. For the laymen, PayPal does provide more security to buyers currently and that is a major factor of importance in this hobby. Additionally, PayPal is more convenient for most to access which is of another major importance for all. I argue that for many transactions which are still conducted through PayPal such as when dealing with a trusted trading partner, that Bitcoin should be used instead as buyer protection is not worth the addtional 2%+ that PayPal receives for it there. Perhaps when these new classes of digital currencies like Bitcoin begin to address these security issues better more people will migrate.

[Branesergen]

if people are using bitcoin to make withdrawals to their bank account of any amount of $1000 or more (it's slightly less than paying 25% of fees compared to the current rates from PayPal btw).


I think I may have gotten to the root of it. But 1st - Explain 25% in fees? Are you saying paypal takes 25% to transact and move said transaction to your bank account?

I dont deal in $1,000 increments but my last $300 transaction cost me $9.09 in fees with free transfer.

I'm beginning to think its because you're in a different country and with conversions you're losing more in fees than we Americans are. Which if that is the case, its why you're getting "pushback". I only say pushback because its not something that we need here. For me to accept and transfer $1000 it would cost me less than $30. If you're saying "slightly less than Paypal" then its less than $30 for me? But your 25% makes it seem like it costs slightly less than $250 which is a no brainer in Paypals favor. Which is where clarification is needed.

Short story long - What does it cost you to accept and transfer $1000 via bitcoin?

[aggie4ever]

I think I may have gotten to the root of it. But 1st - Explain 25% in fees? Are you saying paypal takes 25% to transact and move said transaction to your bank account?

He's not saying the fees are 25%. He's saying bitcoin fees are 25% of paypal fees. So if paypal charges 2.9%, then bitcoin charges around 0.75% (2.9% x 25%).

[Orangejello727]

Do US banks allow or do email money transfers (EMT)??

Ive been using EMT with other Canadian buyers/sellers that I trust. Its a great way to transfer money for $1.50 per transaction up to $2000.

[Branesergen]

He's not saying the fees are 25%. He's saying bitcoin fees are 25% of paypal fees. So if paypal charges 2.9%, then bitcoin charges around 0.75% (2.9% x 25%).

Ahhh yes. Huge misread on my part. Thanks!

[brettmik59]

I'm a recent convert to bitcoin. I used to be a major skeptic like many people on this board.

What I love about it is the ability to instantly transfer funds without a 3rd party for extremely minimal fees or no fees at all, but most importantly the fact that it is a decentralized currency (or protocol) that essentially nobody has control of. Government cannot control it, therefore they cannot print it or debase it. It gives total freedom back to the people and represents a revolutionary advancement in computer science. There is no Bitcoin company. It's not like Paypal. Bitcoin is fully secured by cryptography and the laws of mathematics, run and verified by the world's most powerful computers. And the cool thing is it is still evolving, although changes require agreement among Bitcoin "miners", which basically are the computer power behind processing and verification of transactions on the "blockchain", which is the ledger of all Bitcoin transactions. You can't fake or hack Bitcoin. But you do have to make sure you keep your Bitcoin wallet safe and secure.

I would recommend anyone with an interest in reducing money transfer fees, or simply putting control of currency back into the hands of the people, to read more and learn more about Bitcoin.

When buying from reputable sellers (keyword reputable), I'd be happy to pay with BTC so Paypal can't skim anything off the price.