Google, Amazon, and Facebook are some of the leviathans of internet commerce. They have billions in funding, scores of lawyers, armies of programmers, logistics and support staff. Wielding huge influence, power and reach as a result. The effect of one of these accepting bitcoin as a form of payment would overnight catapult it onto the world stage as a major currency accepted almost everywhere.
We are not however going to see the adoption by any of the big powers until it’s already widely used by a significant percentage of smaller online retailers. The take-up by one of the giants will only come as a result of bitcoin’s success, not its cause or ideology. So it is small merchants we must win over first in many small battles before we can hope to win a large one.
The incentives to accept bitcoin as a method of payment, especially for smaller operators, are obvious:
- No chargebacks
- No need for a merchant account
- No paperwork
- Almost non-existent fees
If bitcoin’s attractions are obvious, its shortfallings are painfully so:
- High technical barrier
- Danger of stolen coins if compromised
Few mom n pop eVendors have the needed software development skills to integrate bitcoin with their store, and even fewer have the knowhow to secure those stores from bitcoin breakins.
Onto the scene steps osCommerce, and the man who is bringing it into the world of bitcoin. osCommerce, an online store managment system, is used by well over 14,000 live websites. Among its more well-known users are the Madriva Linux Store and the Mozilla Store, the catagories of stores cover Arts and Antiques to Travel and Tours. Just the kinds of small, mom n pop operations that can get a real competitive advantage from the benefits bitcoin has to offer.
David Sterry, California based computer consultant, developer, and free software advocate began working to make bitcoin an easy payment option for osCommerce users. He started with the already existing bitcoin module and went from there. What he’s added has made this option cheap, easy, and secure.
It includes all the software needed to reliably run bitcoin, the only requirement being that it’s not run on shared hosting (cheap VPS however is fine). Features include:
- Allows bitcoin(d/s) to be on a different machine than osCommerce
- Unique payment address for each order
- Forwards bitcoin to a safe address when threshold reached
- Automatically calculates the USD exchange rate
This is a small step that will have a growing impact on the acceptance of bitcoin for online commerce. The result of David’s efforts are that it’s as easy to get up and running with bitcoin as with osCommerce itself, and it reduces the amounts that can be stolen to no more than pocket change.
resources:
It’s a start. I’m in the process of setting up an osCommerce rare book site, and I’m glad to see this.
It’s only a start though, as good as it is to hear that somebody serious is putting that piece together.
But we (the bitcoin community) already have all the bitcoin; and since selling to each other in a roundele fashion doesn’t really increase bitcoin usage in the world at large… why doesn’t somebody like Bitinstant partner with Mr. Sterry? Because what we need is a way to have regular (i.e., non-bitcoin) users pay in fiat on a website, and have the merchant’s checkout piece automagically deposit bitcoin in their wallet. Or, at the very least, deposit the fiat into a Mtgox account (one assumes at this point that MtGox would have a setting to instantly convert any deposited fiat into bitcoin).
We’re not going to drag the rest of the world into this until they can see – clearly – that things really are cheaper in bitcoin. So when the BTC/USD rate is 1:5, 20 BTC buys you $99.50 worth of stuff – but $100 buys you $93 worth of stuff due to money friction fees in the fiat system.
That’s how it happens, and that’s the *only* way it happens. I’ll do my part: I’ll put up a couple hundred k worth of rare books – but only when I can get bitcoin for them, no matter how my customer pays.
Toni I’ve been saying that that for months. There has to be a way where merchants give an incentive if their users use fiat in the form of some bits of bitcoin back or something.
In fact, I have a website around that spend4bitcoins.com that I’ve been wanting to use for this.
What it does is drags in everyone using the old currency and gives them a taste of a new way of spending.
Good points.
Good points, James. I would add exchange rate volatility to the perceived list of shortcomings.
In discussing bitcoin with merchant sites, the volatility and the associated fees related to FX conversion just don’t outweigh the other savings yet. They mostly do not intend to hold bitcoin balances because they need national currency.
On the customer side, they don’t really get the full benefit if they have to pay high fees to obtain BTC. I believe that the key lies in merchants retaining (and hedging) bitcoin balances and then removing friction from the bitcoin exchanges, which is admittedly a challenge.
Oh my … this is awesome guys!!! Now I can sell underaged anus with osCommerce! Only love …
I think this sort of service is exactly what is needed for Bitcoin to progress. Make user-friendly applications and middleware that work on top of the blockchain, and increasing numbers of merchants and users will join the Bitcoin community (i.e. If you build it, they will come).
I was a little disappointed that some form of the Bitcoin logo was not on the osCommerce website.
I haven’t looked at this module eyt but one thing I’ld like to know is can I use it without requiring the buyer to register a shopping cart account?
Just enter shipping address and hit the pay button — no registration or login required?
This isn’t included in the module but is possible with osCommerce and a module called Purchase Without Account (though it requires some mods to work with the latest version).
I also tried to find reference on the oscommerce to bitcoin, and there none, except for the addin modules, with a website that seemed to not provide the right tool (btcinch.com)
Someone with connections should work on getting the BTC logo on a prominent page of oscommerce site.
Bitcoin will never be accepted by Amazon/Ebay/etc because:
1. They are required to use national currencies only.
2. They have to comply with numerous federal regulations.
3. They have to have possibility reversing sale in case of dispute.
4. They have to maintain paperwork.
5. They need to maintain merchant accounts to have fees paid by their sellers.
So forget about them. We should create our own versions of p2p Ebay or Amazon.
They should certainly be able to accept them, just not pay them out… but except for ebay, why would they need to.
On a short note, we also have a first alpha-quality release of a Magento extension for accepting Bitcoins, and it’s free and open source:
“magento-bitcoin” by ticean
https://github.com/ticean/magento-bitcoin
Have not tried it yet, but definitely will.
If anyone knows of a shopping cart extension/plugin to allow it to accept Liberty Reserve or Pecunix, I would appreciate a link or two.