Silk Road forums
Discussion => Silk Road discussion => Topic started by: subg on July 06, 2011, 07:39 am
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SR is a store and shouldn't be victim to the insanse fluctuations of the market. As a buyer I don't mind if, after the transaction has been completed successfully, there's an option to pay more bitcoins to match the current value.
The way I would suggest it implemented is that it would be part of the checkout process and can be force enabled by the individual seller or optional based on agreement before sale. So you can tick a box (or it is pre ticked) that offers to offset the bitcoin price after a transaction has been finalized.
This would go BOTH WAYS. So if bitcoin goes to $30, then the seller has to refund bitoin to match the current value. If it drops to $5 then the buyer has to pay more bitcoins to match the current value.
For collateral, if the seller needs to offset the value, then the coins in escrow are not released till the seller adds the required bitcoin (if the value is more than what is contained in the sale). For buyers, we would have to put up a few bitcoins (say like $30-50 worth) that would go in escrow on our first purchase. Then that pool can be used as collateral for each purchase. Or say, up to 5 purchases before another collateral pool is required.
This is a rough sketch, but modified from a version of this I am trying to do for my bitcoin sales (outside of SR).
Edit: BTW, I suggest this for a personal reason. I think there are so few worldwide sellers because of the length of transit times to international destinations and I am hoping limiting the effect of bitcoin fluctuation will help encourage more international shippers.
On a very personal note. If you sell a THC oil and this would make you consider shipping international, message me. I want THC oil for ecig use and will be happy to do this as a side arrangement.
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I think it's fine the way it is. Sellers peg their prices to the current market rate and when an order is placed that is how much it will cost. If the value goes up or down after that then tough shit.
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Its funny that you posted this. I was thinking of something very similar. I mean very similar. But your idea is a little better and less complicated than mine. Same idea though.
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So conversely, If BTC values go up the buyer gets a partial refund?
Regulation can't just serve the supply side.
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@redtide - "This would go BOTH WAYS. So if bitcoin goes to $30, then the seller has to refund bitoin to match the current value. If it drops to $5 then the buyer has to pay more bitcoins to match the current value."
Yup.....
Not that I'm saying I am all on board with this, as a seller, but it's a possible starting point for some price stability.
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If it protects both parties, I wouldn't object.
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What if the dollar rises against the Euro?
Pegging to the dollar would not be fair as it leaves everyone else subject to the fluctuations of the dollar.
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FYI...this functionality is already available. Just price your item strictly in BTC and not USD (it's in the preferences somewhere).
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@performance - you can either price in USD or BTC, but just lets you choose which side you want to peg to. That doesn't solve the problem, the problem is in the time delay between goods received/funds released and the actual transactions (can be up to 3 weeks). Just go look at a BTC chart and check the last 3 weeks of price swings.
I think it should just stay as is, personally. There are times of appreciation and time of depreciation. Sellers get messed over on a depreciating BC but at the same time buyers are more antsy to purchase since they will be getting less as the downtrend progresses. Your volume picks up on down-moves. The opposite is true of BC appreciation - buyers lose out and sellers win because it's just constant margin inflation while the BC price goes up. The downside is that buyers are less likely to purchase immediately and might sit out to see if they can get more product for their BC.
It's an occupational risk. Anybody who can't handle it needs to move over to OVDB and try to do business there. This adds a layer of anonymity (plus the tumbler) and allows you to wash the cash pretty easily and at a lower cost even than washing money in the B&M world. I don't think it should be touched personally, everybody knows what's up and if they don't they either shouldn't be here or they should figure it out to a point where they are comfortable, or can at least deal with it.
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I am definitely not saying this should be mandatory for all sellers and buyers. It can certainly be a choice if a seller wants to do it or not. The only mandatory part will be the buyer putting up the collateral *IF* they do a transaction with a seller who is using the risk free system.
As for the dollar and euro, check the historical charts. The arbitrage value of dollar to bitcoin to Euro (in any order or grouping) is generally close to 0. There have been a couple spikes that last for a few minutes but otherwise the variance is a few cents to around a dollar. Arbitragers sit at a computer looking for exactly this, so if there is a large enough variance, they would spam trades and it would even out really quick. This is also kind of how it is in forex trading as well, but forex has futures to keep it even more stable. Anyway, that is moot as SR is already pegged to the dollar (Mt Gox value is dollar based and SR exchange is pegged to Mt Gox) so every seller at SR is victim to the ups and down of the dollar.
If its not obvious from my first post, I am definitely not in a dollar based location, so I would be far happier if bitcoin were pegged to something like gold. However, that is pegged to the dollar as well, so there is no escaping it for now (one of my hopes for bitcoin). Truthfully, I kind of wish I posted this over in the bitcoin forums. I was going to post what I am doing in my RW scenario, but I was here first and now I really can't or I would be tacked, lol. Bitcoin fluctuation is a big issue for all bitcoin based merchants and maybe someone here can take this idea and run with it over there. Maybe we can get more vendors in the world.
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I do recognize this as a problem, especially when it takes a tumble, and it exposes the hardships the escrow system places on people--sellers especially. I'm all for pegging it to whatever currency everybody agrees on. I'd be o.k. with dollar, simply because it's easy to find out, and it's the most commonly used anyway...I know it sounds like we're giving a break to the yanks, but it's just like using english for many of us it's just the reality it's the international internet language. Not fair, but there it is...
I've posted this elsewhere: I think there should be a 'click' area where a buyer--when he knows seller--can click and pay immediately, rather than wait on escrow. The sellers I do business with are trustworthy, and I"d like them not to have to wait out on escrow, and--lately--watch the value of their btc drop daily. This would solve a lot of problems, including this one. It would make the fluctuations way less important, and would reward good sellers. Escrow is more to protect buyers from bad sellers if shit goes bad. Having an optional 'stop escrow' button, would be a good faith reward and good sellers wouldn't take advantage of this.
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I just read this post: http://dkn255hz262ypmii.onion/index.php?topic=670.msg4795#msg4795. Ouch, a vendor is padding his/her price by 30% to counter the bitcoin fluctuation.
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I think he meant that he is charging 30 percent more here than what he would charge face to face because of the btc, shipping/ risks etc. I may be wrong..