I’ve been following a recent Twitter exchange between the father of the RPG&MMO genre Richard Garriot and a popular Bitcoin internet radio show “Let’s talk Bitcoin”
Here is the exchange between the two (the msg exchange starts at the bottom):
Zynga already announced they accept Bitcoin[/URL], which was great move on their part and they are a behemoth corporation. One would expect to see such bold moves from smaller game companies.
Mindark could use same method Zynga used, which was a Bitcoin payment processor like Bitpay or Coinbase .
Bitpay acts as an intermediary between the Bitcoin network and the company that accepts the Bitcoin payment. If the company doesn’t want to risk holding Bitcoin due to currency volatility for example, they can just use a payment processor like Bitpay or Coinbase and have Bitcoins converted by Bitpay into USD, Euros or other currency of choice. By accepting Bitcoin via Bitpay, Mindark won’t even see or “touch” the Bitcoins, they will only see the USD, Euros, Krona or other currency of choice and get all the of media exposure and some new customers that should come with it.
Coinbase (Bitcoin payment processor) CEO talking on Bloomberg about how they handle payments for big retailers such as Overstock. Worth watching to understand the mechanism behind it:
I still have no idea what a bitcoin really is. Can someone explain in simple terms please? and how can this imaginary bitcoin that doesn’t exist be used in a real shop?
Guess what I can’t get my head around is when & how will it be used in a real shop?
In a way real money these days doesn’t really exist either but it’s accepted that it does So yes, in that sense it may be possible.
The difference to me though is real money follows certain rules and we can’t all just start printing money. I’m not so sure that’s true for bitcoins, if we can all just “print” or conjure up bitcoins out of thin air wouldn’t it just make the currency meaningless as in hairdressers in hitch hikers guide to the galaxy where they used leaves from trees as currency?
I would have to really hijack the topic to answer your question.
Suffice to say that Mindark could use same method Zynga used, which was a Bitcoin payment processor like Bitpay.
Bitpay acts as an intermediary between the Bitcoin network and the company that accepts the Bitcoin payment. If the company doesn’t want to risk holding Bitcoin due to currency volatility for example, they can just use a payment processor like Bitpay and have Bitcoins converted by Bitpay into USD, Euros or other currency of choice. By accepting Bitcoin via Bitpay, Mindark won’t even see or “touch” the Bitcoins, they will only see the USD, Euros, Krona or other currency of choice and get all the of media exposure and some new customers that should come with it.
Best way to implement bitcoins into entropia is if a payment provider provides it as option, rather than MA. After all, MA pays their employees in IRL convertible cash with somewhat stable exchange rate.
As far as I know, Zynga’s games doesn’t provide ingame trades (with “deposited” means), and you can’t withdraw. In the games I’ve tried (facebook games) you pay to get “crowns” (used for upgrades) and decorative items like candy colored animals. For Zynga, they can accept bitcoins as a marketing ploy, at least as long as a few player still purchase things with IRL money. With a very limited pvp trade system, they also could allow withdrawals by keeping records over how players deposited - if a player has deposited using bitcoins they could force the player to withdraw in bitcoins (and then bitcoins they kept). In Entropia, if player A uses bitcoins to buy PEDs, hands over the stack of PEDs to player B, and player B withdraws, then it would be MA who need to take the risk. Or, as I said, it would be better a payment provider stood for the risk with bitcoins.
I read somewhere that a trader who deals with bitcoins, should have a premium rate to balance the currency risk, of say 200%. That is, let’s say “x bitoins” are worth 10 USD. Now you want to buy a gun ingame that costs 100 (wel 97) ped. Now you’d have the option of either depositing 10 USD, or depositing 2x bitcoins, besides the exchange rate also a premium that would correspond to the current exchange risk.
And as I don’t think MA wants to trade with bitcoins, it’ sbetter if MA doesn’t do this, but rather adds a financially secure payment provider who knows how bitcoin trading works and is willing to take the risk.
For zynga, letting people “deposit” with bitcoins, and also to be the first to do it, is good marketing. But as a source of income - nah. But as long as they put bitcoin deposits on marketing account, it’s no bigger deal for them to store incoming bitcoins in the bit bucket.
Some say Bitcoin, and other Coins is the future of money. Completely virtual, unhackable. Many people have become ‘bitcoin-millionaire’ by buying them when they were still cheap. One can compare it to auction shares, their value is speculative, untill it is largely accepted and its value settles. Its current value is around 800, and it is expected to raise to at least 10.000 usd.
some say Bitcoin is power to the people money
some say Bitcoin is one-world government money
some say Bitcoin is dangerous and highly speculative
some say Bitcoin is very profitable
but facts are that
Bitcoin is gaining world-wide acceptance and growing faster then apple, and facebook did
Bitcoin is becoming a payment method for many small and larger businesses.
Bitcoin is something people invest into, while expecting roi.
Bitcoin has no accountability, no regulation and no recourse in the event of hackers just taking all the coins they can. The last thing I would want is my assets here being backed up by a currency that is not protected from outright theft at any given time, or backed up with anything actually tangible.
That was always my concern with bitcoins, there have been a few exchanges that were hacked (using untraceable ToR /onion servers…i.e. no IP addresses)
Also there’s so many new virtual currencies joining the bandwagon, I fear a problem soon.
Hell why can’t I pay my bills in ped (not that I would want too). In some ways MA was ahead of their time when they was going to introduce the credit card.
Personally I’m quite happy to use dollars or pounds, the only ones I see screaming for more are bitcoin owners that are desperate for companies to adopt bitcoin so they can cash in their investment. Speculative for sure.
Hmm… Interesting idea. I can see the PR benefit from being first MMO to accept BitCoins. Easy (almost) free publicity.
But other than that I think there’s really no enticement.
And… Will there be risks? Will some countries ban Entropia because they are afraid of BitCoins?
If the service is done by a payment provider, why not (as long as they take all risks involved).
Then why doesn’t MA already allow deposits using gold, IRL Real estates or Ericsson shares?
I think, if anyone want to invest in something, it’s their own choice, taking into account profit opportunity and risk. The main business for MA though is running a game, not running an investment bank. MAs business shouldn’t be investing in irl item X or currency Z that isn’t needed to run the primary business.
No risks whatsoever because Entropia will get USD, Euros, AUD, CAD or other FIAT currency via Bitpay.
Bitcoin recently reached a market cap of $10 Billion and growing. There are Wall Street hedge funds that have a $5000 price target for Bitcoin for 2014. This would turn Bitcoin into a $50-60$ Billion market. Some even have $10k price target, which would mean a $100+ billion market cap. So yes, there will be a nice marketing boost and free publicity but there’s also real potential to get extra revenue, as Bitcoin will quickly become a popular alternative to Visa and Mastercard. Oh and I forgot to mention. There’s also much lower fees using Bitpay for Mindark, than using Visa/Mastercard. People could get more PEDs/deposit than with regular Visa/Mastercard deposits.
So you don’t think there is any risk at all? Mainly,
Fluctuation in value
Government stops big exchange from transferring Bitcoins ↔ IRL currency
Special case of (a): If a big exchange closes, it can be harder to sell bitcoins, and a remaining smaller exchange maybe can’t offer the previous exchange rate.
I would say there is a risk.
Also, a currency risk can be both because a currency goes up, and the currency goes down; depending on which side of the transaction you are on and who is taking the risk that the quota of the exchange rates might change between a transaction is suggested until it’s committed in it’s entirety.
There is negligible risk for the company who accepts Bitcoin payment via Bitpay or Coinbase or other payment processor. The company gets normal FIAT currency and Bitpay gets the Bitcoins. Wordpress, Zynga, Overstock did the math and considered the risks before accepting it as payment option and they are bigger companies than Mindark.
There is more risk actually from accepting Paypal or Visa/Mastercard payments because customers can ask for chargebacks. There are no chargebacks when using Bitpay, Coinbase or other Bitcoin payment processor. There are also higher fees for accepting Visa/Mastercard payments, which MA and the customer has to support. People could get more PED per deposit with Bitpay for example than by using Visa/Mastercard.
p.s: This news broke out today http://www.coindesk.com/overstock-opens-bitcoin-sales/ Overstock started accepting Bitcoin payments via Coinbase today, even though people expected it to happen later down the line in 2014.
So yes, in that sense it may be possible.