magento north east: introduction to bitcoin
TRANSCRIPT
Introduction to BitcoinMagento North EastSeptember 2016
@RichardCarter
What is Bitcoin?
1. A crypto-currencyRather than “real” money, it’s “virtual” money you store digitally
US Treasury calls Bitcoin
Decentralised virtual currency
2. Distributed currencyTransactions are between users: no central intermediary
3. Peer to peer currencyPublic record: a distributed ledger called the blockchain is used to record transactions
4. Secured by “miners”Transactions pass through “miners” who validate transaction
Paid in newly “minted” Bitcoins
Image: bitcoin.org
Image: weusecoin.com
Similar payment systems
Plenty of alternativesDogeCoin, Ripple, Litecoin, Mastercoin…
…but Bitcoin is probably best known and most popular
Who uses Bitcoin?
Over 100,000 merchants in Feb 2015 (and this has grown)
http://www.ibtimes.co.uk/bitcoin-now-accepted-by-100000-merchants-worldwide-1486613
Some really big companies!
MediaWikiGreenpeaceMicrosoftPayPalExpedia
Advantages of Bitcoin
Fast transactionsNo wait for your provider*
*But there are some issues these days: https://medium.com/@octskyward/the-resolution-of-the-bitcoin-experiment-dabb30201f7
Free transactions
Very low feesTo convert to “flat” currency such as GBP, USD, EUR
Image: weusecoins.com
Convenient for customers
Reach a wider marketBitcoin is a truly global currency
No chargebacksTransactions are not reversible (!)*
Or are they? See https://medium.com/@octskyward/the-resolution-of-the-bitcoin-experiment-dabb30201f7
Disadvantages of Bitcoin
Exchange rateFluctuates a bit…
..although so does GBP ;)
Image: xe.com
RefundsA bit trickier to do in Bitcoin.
Most merchants refund in store credit
Stolen currency?Transactions are irreversible
…basically: store a safe, offline copy of your wallet
How to steal a Bitcoin*
*but, don’t
1. Copy user’s private keysThis effectively gives you the money
…but that is traceable in Bitcoin’s blockchain (the public ledger of transactions)
2. Launder your moneyUsing “mixers”/“tumblers” –transfer it to other accounts in varying amounts to cover your tracks
…these move the money to a “clean” address in the blockchain.
3. Convert it to flat currency…is where it gets trickier, as large withdrawals to flat currency could identify you
…especially with large amounts. Best to trickle the stolen Bitcoin out slowly
Bitcoin for Magento merchants
1. Bitcoin payment providerAs a merchant, you’ll need a Bitcoin payment provider such as BitPay or Coinbase
Providers should remove some of the headaches for you!
Ask your payment provider
1. Can I get a unique Bitcoin address for each transaction?2. How is the exchange rate calculated?3. How fast are payments approved?4. What is my exchange rate risk?5. How do I receive the funds?6. Are there any fees involved?7. How can I see a listing of my sales?
Source: weusecoins.com
2. Magento Plugins!
Small selection depending on your provider
Small selection depending on your provider
github.com/coinbase/coinbase-magento
bitpay.com/bitcoin-for-ecommerce
3. Profit!
Further reading on Bitcoin bitcoin.orgweusecoins.com (merchants)
