Re: Seeing the forrest from the BTCs

On 01/19/2015 11:01 PM, Daniel.Buchner wrote:
> In doing so I came up with a few important concerns/requirements for
>  each stakeholder-type:

Thanks for this list, Daniel, very helpful. Speaking as someone that has
been with this community since the beginning and who has been to every
Web Payments IG meeting, let me try and add a bit of extra color to your
statements.

> Consumer
> 
> *   Let me pay easily with a single simplified solution, and let the 
> mechanism, medium, and flow be ubiquitous.

This is a goal of the Web Payments CG (depending on some definition of
'mechanism', 'medium', and 'flow') and seems to be also an emerging
goal of the Web Payments IG.

> * Let me pay securely without the inherent susceptibility to ID 
> theft, fraud, and malicious activity that is common with current 
> mediums (ex: credit cards)

Yep, approved as a use case that we should work on in the Web Payments IG:

https://dvcs.w3.org/hg/webpayments/raw-file/default/latest/use-cases/index.html#push-based-payments

> Retailer
> 
> *   The solution should be easy to integrate

I don't think we'd have it any other way :). The politics here are more
difficult than the technology. You have to convince the people that make
the devices for the merchant to support the technology. I'll note that
one of the Web Payments IG chairs works for Verifone (who make these
devices).

> *   The solution needs to be more secure than the status quo

See push payments above.

> *   The solution should lower/eliminate fees and costs, if possible

Lower, yes. Eliminate is not possible without far more advanced
technology than Bitcoin and Ethereum - smart contracts and automated
judicial processes for theft/charge-backs.

> *   The solution should allow us to easily account for our unique 
> business logic (different consumer interfaces and internal processing
> requirements)

The W3C has excelled at delivering specs that meet this criteria in the
past.

> CG/IG/WG Members
> 
> *   Don't force numerous, hefty specs on implementers that try to do 
> it all

Based on preliminary conversations in the Web Payments IG - we're
definitely not trying to do it all, we're trying to focus on a very
small and critical subset of use cases.

> *   Make sure user stories are priority #1

The Web Payments IG is focusing on the use cases document right now as
one of the first deliverables of the group.

> *   Don't pit forward-looking solutions against legacy ones in the
> name of unifying all current mechanisms/mediums of payment

Agreed, and I don't think anyone is proposing this?

> 1.  Completely separate development of solution meant to unite
> legacy payment systems from an unencumbered, future-forward solution
> based on a completely open payment network

I don't think we have to do that to be successful, we can do both. The
problem is with decomposing the problem into the proper layers/phases.

Bitcoin is about payment clearing - that's the last step of the payments
process. The others being:

1. Offer of sale
2. Customer Payment Initiation
3. Merchant Invoice Delivery
4. Customer Payment Approval
5. Merchant Payment Verification
6. Payment Network Clearing

There are no Web standards for #1-#5 right now. Even if we embrace
bitcoin and #6 is solved, it doesn't change the requirements for the
first 5.

What happens when Bitcoin is replaced with something better? We don't
want to assume that any stage of the process above is final, they should
be pluggable/replaceable as much as possible. So, Bitcoin / Ripple /
Ethereum / whatever comes next should be able to be used in step #6.
Saying that "one of them will be King" is not the path forward. There
will not be one "open payment network", there will be many.

> Most Bitcoin proponents pour the majority of their effort into 
> pushing Bitcoin as a currency (it could be at some point in the 
> future), but what if that's not the right way to think about the 
> opportunity Bitcoin presents us as a payment standards-based group? 
> Instead, what if we used Bitcoin for the thing it has done well
> since day 1: transport value across an open network.

I don't think the currency aspect of Bitcoin has ever really been seen
as Bitcoin's primary strength in this group. The groups position seems
to have always been aligned with yours - the value of Bitcoin is in the
transport network, not the currency.

> what if users held local fiat currency in a provider's wallet and
> could purchase anything through one simple, unified flow without ever
> knowing the system performs on-the-fly conversion between Bitcoin and
> back to transfer funds?

Could you get into some detail on how this would work without the funds
in their wallet being susceptible to the ebb and flow of the value of BTC?

> *   Any company/actor could leverage this simple, unified payment 
> rail/solution (Coinbase, traditional bank, browser, app, etc.)

Clearly, this would be great... how do we address the ForEx risk?

> * Users would realize all the benefits of a simple, universal payment
>  system without needing to understand, care about, or ever even hear
>  about the nerdy Bitcoin tech that acts as the rail

We still wouldn't have a "universal payment system" at that point (how
do you do steps #1-#5 above?). How do we buy using credit? How do we do
two-phase purchases (like buying fuel?).

> *   The scope and effort required on the part of UAs shrinks
> dramatically

How does this happen? I would think that the complexity goes up
dramatically as the UA now needs to implement the Bitcoin protocol?

> *   Site/app integration is also radically simplified (for some
> sites/apps it can be as easy as adding a link to their pages/views)

Details? How does adding a link support two-phase purchases, or digital
receipts, or paying via credit, or applying coupons/loyalty cards to
purchases, etc.?

> *   Business costs drop for every party involved

They go up, don't they? Because not everyone is going to switch, so
merchants still have to support all the legacy payments, and this new
one. That's exactly the sort of thing we're trying to get away from w/
the Web Payments stuff - we don't want to prescribe /one/ mandated way,
we want to provide a framework where you can use direct debit, credit
cards, VISA, PayPal, Google Wallet, Bitcoin, Ripple, and Ethereum.

Good thoughts, Daniel - looking forward to hearing more about the
details above. :)

-- manu

-- 
Manu Sporny (skype: msporny, twitter: manusporny, G+: +Manu Sporny)
Founder/CEO - Digital Bazaar, Inc.
blog: The Marathonic Dawn of Web Payments
http://manu.sporny.org/2014/dawn-of-web-payments/

Received on Wednesday, 21 January 2015 05:07:22 UTC