Jack Maller announced goods and services payment over Bitcoin lightning network which costs a lot less than the 3% fee Visa/Mastercard are charging merchants.
Most people don’t realise that 3% of sale could be 30% of a merchant’s take home profit.
For example: Sell a product for 100 dollars, making 10 dollars profit. A saving of 3 dollar (3% of 100) means a 30% increase in a merchant’s profit.
I finally understand why buying goods (groceries, clothes, take away, taxi vouchers etc) on bitrefill with bitcoin comes with a few percent cashback. I thought they were just burning money for adoption at the beginning.
It makes complete sense now, 1-2 small middlemen cost less than 3-5 corporate middlemen.
This could be huge for merchant, and could “trickle down” to consumers as well if merchant want to share the savings to incentivise their customers to use this new payment rail.
Update: Listening to Greg Foss now. Apparently
Credit card merchant fee in Canada is roughly 2.5%
Merchant fee in El Salvador 8%!!!!
Many people ask about capital gain tax, so let’s only talk about using fiat, not btc to pay for goods.
Fiat(buyer)- btc/lightning -fiat(merchant) network = Less intermediaries, low fee (0.1-0.5%)
Fiat(buyer)- Big bank- Big bank- Big bank-fiat(merchant) network = high fee (2.5-8% depending on countries)
The key here is the Bitcoin/lightning net work, customers and merchants don’t need to touch Bitcoin at all, they can pay/receive USD, EUR, CNY, you name it.
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