Micropayments at the Tipping Point?
@meinharrd | @SatoshiPay
Bitcoin payment processing
Exclusivelywhite-label
Common sense: below €1
Bitcoin: doesn’t matter(above 546 satoshis)
Around since rise of web late 1990s
Charge for content or network service
Alternative to advertising
W3C Working Draft 1999:
“Common Markup formicropayment per-fee-links”
<meta>, <embed> and <object> parameters
Millicent Micro Payments
MicropaymentsNetBill
MilliCent Micro payments
MicropaymentsNetBill
MilliCent Micro payments
MicropaymentsNetBill
MilliCent Micro payments
MicropaymentsNetBill
MilliCent Micro payments
MicropaymentsNetBill
Transaction costs
Mental transaction costs
“Customer mental transaction costs come from at least three sources:
uncertain cashflows, incomplete and costly observation of product attributes, and
incomplete and costly decision making.”
Nick Szabo, 1999
Bitcoin to the rescue?
Low transaction fees
But not low enough
Fee + dust = 1000 + 546 satoshis (€0.004)
Mental transaction costs remain
What do users say?
41% of Germans would pay for content
20-29 years: 47%40-49 years: 35%
(Statista)
Existing solutions
ChangeTip
changetip.com
tibdit
tibdit.com
Bitwall
bitwall.io
Bitmonet
bitmonet.com
SyndiCoin
syndicoin.co
Tinypass
tinypass.com
Dogetipbot
dogetipbot.com
@tipdoge
tipdoge.info
DogeRain
dogerain.io
Improve usability
Automate processes causing mental tx costs
Solution: Micropayment Channels
Send single satoshis
Key: Bitcoin transaction with many “drafts”
Rapidly adjusted bitcoin contract
Off-chain but on-chain, stupid!
2 multi-signature transactions
1 signed, but not broadcasted
Adjusted transactions off-chain, e.g. HTTP
No blockchain bloat
Very small amounts: 1 satoshi (0.0002c)
Very low fees (2tx / n)
Instant confirmation
“2015 should be theyear of the payment channel.”
James Poole, RSA
Payment channel projects
Streamium
streamium.io
Strawpay
strawpay.com
Zero Click
challengepost.com/software/zero-click-bitcoin-micropayments
Handles “HTTP 402: Payment Required”
Drupal spam protection via Coin Tools
drupal.org/project/cointools
Payment tech done
Powerful browsers
New visual metaphors
Automated purchases
Users willing to pay
What are we waiting for?
And yes, we are working on something… :)
Thanks!
@meinharrd
@SatoshiPay
slidesh
are.net/meinhard
http://en.wikipedia.org/wiki/Micropaymenthttp://www.w3.org/TR/Micropayment-Markup/http://nakamotoinstitute.org/literature/micropayments-and-mental-transaction-costs/http://www.dtc.umn.edu/~odlyzko/doc/case.against.micropayments.pdfhttp://de.statista.com/infografik/2834/so-viel-wuerden-die-deutschen-fuer-online-journalismus-zahlen/https://en.bitcoin.it/wiki/Contractshttps://bitcoinj.github.io/working-with-micropaymentshttps://www.cryptocoinsnews.com/solution-trustless-bitcoin-microtransactions/http://jamescpoole.com/2014/12/21/2015-year-of-the-payment-channel/
Victor MatekoleJames Poole
Banksy