Quote:
Originally Posted by NYMD
Bitpay advised that with a digital product, we should go with the highest speed transaction not requiring a confirmation. They've not had any transactions not eventually confirm even at the high speed. If I were selling physical goods, I would go with at least 1 node confirm required or their slowest speed, which requires 6.
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They say for "digital product" is enough wait 1 block confirm (10-15 min), well, that's because they think digital = no cost if lost. But for cam site you have to pay the model, and deposits of $100 to $300 at once are not rare at all. So I would set this to 3 to 6 blocks, perhaps depending on amount. From bitcoin faq:
* Transactions are broadcasted within seconds and verified (added to next block in blockchain) within 10 to 60 minutes, average 15-20. see:
http://bitcoinstats.org/
* Double Spend: a malicious user tries to spend to two different recipients at the same time. Bitcoin mining + blockchain create a consensus on the network about which of the two transactions will win. This means it can happen you get confirmation on first block but then on second or third block (so after 10 * 2 or 10 * 3 minutes) you see the "other" transaction won, and you're scammed.
* Confirmation: a transaction has been verified by the network (added in next block of blockchain). Each new confirmation decreases the risk of a reversal exponentially. For larger amounts ( ex. 1000 $USD and above ), wait for more confirmations, for ex: 6. Then 6 blocks or 1 hour is enough to make reversal computationally impractical (no double spend).
Now if you provide revenue share paid quickly AND accept bitcoins verified at just 1st block added (after just the about 10 minutes), some smart one could do double spend to you AND him, and have part of his sales going to HIM after you accounted his revshare. Of course you system should be very retard not to doublecheck after 1st block chain for double spend case AND alert you AND blacklist the affiliate - but most systems are very retard after all.