An estimate of the real savings for merchants from Bitcoin

&quot;Assuming consumers will be ok with only 0.5% in rewards&quot;<p>And assuming they&#x27;ll be OK with having ZERO chargeback rights in case the purchase turns out to be not-as-advertised and&#x2F;or defective.<p>That second article (explaining why consumers would want to do this) best be a doozy, because so far consumers have had to swallow a requirement for them to provide a &quot;mobile wallet&quot;, lower rewards, AND increased vulnerability to fraud all to save the <i>merchant</i> 0.375%.

If merchants were doing sales and returns using Bitcoin it seems like you could make money on the volatility by returning items when the value of Bitcoins went up within the return window. You&#x27;d have to be willing to keep items you bought if the value of Bitcoin went down, but if you systematically made all your regular purchases that way you ought to come out ahead. Is this a real risk for merchants, or am I missing something?

There are no savings given the volatility. Since it can take days to convert to usable currency, you&#x27;d have to bake in 3-20% padding to cover volatility.

Shouldn&#x27;t we be asking what the savings to the <i>consumer</i> are?<p>I use my credit card all the time for 2 reasons: 1) fraud protection and 2) reward points.<p>Interchange fees paid by the merchant are essentially being passed to the consumer via reward points. Why would people switch from credit cards to bitcoin en masse?

Most of these savings could be accomplished by having the merchant withdraw the payment from your bank account rather than a credit card.<p>Frankly, I&#x27;m surprised that Amazon doesn&#x27;t offer this service. Just take the money out from my bank, offer me the same protections as a credit card, and we split the credit card fee: 1% for you and 1% for me :-).<p>Used to be that violated their credit card agreement to charge more for credit card purchases, but looks like that&#x27;s not the case since Jan 2013. <a href="http://www.washingtonpost.com/business/capitalbusiness/as-rules-change-more-retailers-offer-discounts-for-cash-payments/2013/06/29/d4c84d7a-dcfc-11e2-bd83-e99e43c336ed_story.html" rel="nofollow">http:&#x2F;&#x2F;www.washingtonpost.com&#x2F;business&#x2F;capitalbusiness&#x2F;as-ru...</a>

20% savings is not ground shaking. Remember that BTC is tackling an entrenched opponent, quasi monopolist. It&#x27;d take an order of magnitude in savings to guarantee success. Think 50% to 90% less.