Payment business: comparison between Bitshares and it's competitors

[EstefanTT]

For the perception aspect, I think it's best to have almost no fees for creating and cancelling orders and a small % (.1%) on a filled order. Just because everybody is used to this system, even if it's more expensive human beeing is like that irrational and emotional.

The core of the problem created by the 40bts / transaction is when someone wants to send a small amount, which is understandable ! I don't like to pay 40 bts when I send 200, anyone does !

We could promote the ShareBits (tipbot) for anyone wanting to send small amounts. I'm not quite sure if you paid LT fees by tip (using the LT account of ShareNits) or if it's done internally between accounts and it's even less (@fuzzy ?) but in anyway it's at least 5x cheaper.

When someone send a bigger amount (ex 50 000 bts) they don't care that the fees are 40, 10 bor 1 bts, they care about security, reliability, ease of use and latency. It's important to understand which kind of transactions (tiny ones) are the problematic ones with the current fees.

IMHO, ShareBits is our solution for the ones sending small amounts and feeling bad about fees.

Any thoughts about it ?

[xeroc]

@xeroc is this feasible? Seems like it could be a good idea

technically feasible: yes
economically feasible for the DAC: definitely not long term .. that's why it has to be a limited-time offer!!

[Akado]

Good point Akado.  Much harder to increase fees after low fees are established. 

How about a time-limited offer .. 6 weeks .. 3 months .. something like that .. so people know the fees will be increased eventually

Can't Lifetime members do that already since they have reduced fees? by paying them back or something. 

LM could have a parameter that, if approved by witnesses or committee members, would allow them to reduce the fees of those referred by them. That way services using BitShares could still provide lower fees (not as low as lifetime membership).

Witnesses or committee members would vote in the parameters to change. The first would be to approve Lifetime Member X (i.e OpenLedger) to lower the fees of any accounts of their choosing that were reffered by them. Kinda like giving a permission. The second parameter would be the amount of fees (5 BTS, 10 BTS, 15 or 20 bts, etc) according to what they would feel that is the best option.

This could provide monthly discounts. That way OpenLedger could for example provide lower fees to costumers who are one year old or who have provided 2000 BTS in revenue from fees, etc

@xeroc is this feasible? Seems like it could be a good idea

[jakub]

Currency free of volatility PP BTC BTS
No significant third-party risk involved PP BTC BTS
Compliance with Central Bank monetary policy PP BTC BTS
Compliance with AML & KYC PP BTC BTS
Customer having choice over service provider PP BTC BTS
Industrial-scale performance & real-time transaction settlement PP BTC BTS
Quick sign-up process & smooth user experience PP BTC BTS
Low transfer fees for online merchants PP BTC BTS
Low transfer fees for online consumers PP BTC BTS
Support for micro-payments PP BTC BTS
Integrated online currency exchange PP BTC BTS
User-issued tokens to support marketing campaigns PP BTC BTS
Environmentally friendly PP BTC BTS

[xeroc]

Good point Akado.  Much harder to increase fees after low fees are established. 

How about a time-limited offer .. 6 weeks .. 3 months .. something like that .. so people know the fees will be increased eventually

[merivercap]

Good point Akado.  Much harder to increase fees after low fees are established. 

[Akado]

What most people seem to be forgetting about this fee reduction is, once you reduce it, there is NO going back. People just won't accept increasing the fees even if just a little. Even if the amount if insignificant.

People aren't taking that into consideration. Taking a decision with such significance as that this early in the game is plain stupid. You can be very much jeopardizing the future of the structure built around BitShares because of this simple reason.

We never know what's going to happen and it's still to early to reduce fees. You won't be able to increase them back if you ever need.

[merivercap]

I agree Smartcoins are better than anything out there so we can make the case to consumers that transaction fees are worth it.  The referral system will give us an even bigger advantage.  We are going to brand bitCash (using Smartcoin technology) as 'digital money of the future' and that will further differentiate us against traditional systems.

Despite my optimism, consumers will probably expect transactions to be free especially with Apple Pay p2p coming around the corner so it's better not to try to focus too much on p2p transactions.  Hence we're addressing merchant needs first to get our foot in the door and will eventually help us compete on the p2p side. ... We will be making a strong case to consumers to use us from the outset nevertheless...

[fav]

Paypal
+no ridiculous fees for merchants

[Samupaha]

In the threads discussing fee structure there have been frequent demands that we should lower our fees to match our competitors like Bitcoin and Paypal.

I think this is wrong point of view because we have now or we will have in the near future a better service than our closest competitors.

Making a superior product should be our main focus on competition. People are ready to pay bigger fees if they get a product worth of their money.

Lowering fees might get us some users more faster, but it won't necessarily make us more profitable.

So let's do a comparison. Feel free to add any kind of pluses or minuses you can think of. Try to think more of the payments and not the exchange business (we can to that later). Add more comparisons to other cryptocurrencies and payment processors.

Bitcoin
+ Price stable smartcoins
+ Faster
+ Better transaction capability
+ Stealth transfers
+ Recurring and scheduled payments

- Way more users (network effect)

+/- Transfer fees are cheap for the Bitcoin user right now, but Bitcoin's business model is fucked up. Payments are subsidized by inflation that will end in the long run (next block reward halving is coming next year). Transfer fees have to go up some day. Lately the real cost per transaction has been 8-10 dollars. If Bitshares wants to lower transaction fee to the same that Bitcoin has, we need to think how we can make money after that. Is the transaction business going to be subsidized from reserve pool? What if the reserve pool goes empty? Think of the bigger picture here, not just the point of view of a price sensitive customer.

Paypal
+ No cancelled/refunded payments
+ No need to tie account to credit card or bank account
+ Anybody can open an account anywhere in the world
+ No freezed funds
+ Stealth transfers

- Way more users and merchants (network effect)

+/- Paypal's customer service sucks and people hate it. Bitshares doesn't have any official customer service.