Brawker.com takes a BIG CUT.

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Location: Between San Fransisco and New York City.

Finally got around to listening to Friday's Mad Money Machine... Paul Boyer mentions Brawker.com a few times, and it is super-compelling. At the same time, Brawker is selling one Bitcoin for about $140 over today's market price. Does this seem a little excessive?

Posted on July 28, 2014 at 9:44 AM

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Trojantouch

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@segaboy81 Finally got around to listening to Friday's Mad Money Machine... Paul Boyer mentions Brawker.com a few times, and it is super-compelling. At the same time, Brawker is selling one Bitcoin for about $140 over today's market price. Does this seem a little excessive?

To me that seems a little on high end but i guess if your paying for a guaranteed safe transaction. It's not to excessive. The first time i switch paypal to bitcoin i got charged with 10% interest rate with the site i used.

Posted on July 28, 2014 at 11:00 AM
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bobjohnson12321

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That is outrageous... What's the point of even using bitcoin for the average person if the barriers to entry are set higher with someone fleecing unsuspecting customers. Hell, if you know anyone wanting to buy BTC at 10% above market value please let me know. Safe, secure and escrow willing!

Edit: I do like their buy anything with bitcoin and have someone else pay for it then release the coins to you idea. That's just escrow ya?

Posted on July 28, 2014 at 5:59 PM
Last Edited: July 28, 2014 at 6:00 PM
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cyrilhouri

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I am one of the co-founders of Brawker and I would like to respond to this. Brawker doesn't take the "BIG CUT" you are talking about. In fact, Brawker takes almost no cut at all. Brawker is a peer-to-peer exchange, so the bitcoin price that you see is the price that someone else is willing to sell their bitcoin for. If someone wants to sell their bitcoins at $140 over market price, that's their problem: it's up to the buyer to take this order or not. But this is the case with any bitcoin exchange: the price you get is what someone else is willing to sell for. That's basic supply and demand.

Posted on July 28, 2014 at 8:27 PM
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adam

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@cyrilhouri thanks for addressing this misunderstanding. So they are confusing the BTC sellers item "discount" with the fee going to brawker. What is the fee, and during what parts of the process is it applied?

Posted on July 28, 2014 at 8:29 PM
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cyrilhouri

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The fee is 1%. It is built-in in the conversion rate. So if someone is placing an order with a 7% premium, you will actually pay an 8% premium to get their bitcoins.

Posted on July 28, 2014 at 8:39 PM
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Cryptonaut

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@cyrilhouri I am one of the co-founders of Brawker and I would like to respond to this. Brawker doesn't take the "BIG CUT" you are talking about. In fact, Brawker takes almost no cut at all. Brawker is a peer-to-peer exchange, so the bitcoin price that you see is the price that someone else is willing to sell their bitcoin for. If someone wants to sell their bitcoins at $140 over market price, that's their problem: it's up to the buyer to take this order or not. But this is the case with any bitcoin exchange: the price you get is what someone else is willing to sell for. That's basic supply and demand.

kind of like localbitcoins. they take a pretty small cut, but its quite common to see everyone listing like $50+ over the normal exchange rates

Posted on July 28, 2014 at 8:53 PM
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dpc

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I'm glad this was addressed, I had written off the site as predatory. I liked the idea of brawker, but the mark ups are insane. It sounds like it an issue because the market is small, and not just an issue of a greedy business.

Posted on July 28, 2014 at 9:40 PM
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adam

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Sounds like a good message to get out in a sponsor message :)

Posted on July 28, 2014 at 9:47 PM
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cyrilhouri

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@dpc I'm glad this was addressed, I had written off the site as predatory. I liked the idea of brawker, but the mark ups are insane. It sounds like it an issue because the market is small, and not just an issue of a greedy business.

Yes, the main reason is that the market is still small. We started the site with a flat premium of 8%, meaning that someone could use their bitcoins to buy anything on the internet and they would get a 8% discount over the listed price. The problem that we had was that these orders were being snapped in minutes, which made us realize that there was a big demand for easy-to-purchase bitcoins: people were willing to pay 8% over spot in a heartbeat for the convenience of buying bitcoins with a credit card. So the problem that we had was that we were ending up with an empty order board most of the time, making the market look almost empty. So we changed it to a customizable premium of up to 20%. So we still have the low-premium orders being taken fairly quickly but the only orders that "stick" to the order board are the ones with a high-premium, which can result with the perception that initiated this thread (i.e. very high premiums). I guess that once there will be a larger number of orders, we will have a better price discovery for easy-to-purchase bitcoins. But at this time, we can safely say that their market price is somewhere between 8% and 18% over spot.

Posted on July 28, 2014 at 10:16 PM
Last Edited: July 28, 2014 at 10:17 PM
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dpc

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@cyrilhouri

@dpc

Yes, the main reason is that the market is still small. We started the site with a flat premium of 8%, meaning that someone could use their bitcoins to buy anything on the internet and they would get a 8% discount over the listed price. The problem that we had was that these orders were being snapped in minutes, which made us realize that there was a big demand for easy-to-purchase bitcoins: people were willing to pay 8% over spot in a heartbeat for the convenience of buying bitcoins with a credit card. So the problem that we had was that we were ending up with an empty order board most of the time, making the market look almost empty. So we changed it to a customizable premium of up to 20%. So we still have the low-premium orders being taken fairly quickly but the only orders that "stick" to the order board are the ones with a high-premium, which can result with the perception that initiated this thread (i.e. very high premiums). I guess that once there will be a larger number of orders, we will have a better price discovery for easy-to-purchase bitcoins. But at this time, we can safely say that their market price is somewhere between 8% and 18% over spot.

Thanks for the explanation, that all makes sense. There is no reason to artificially set the markup for your users so I can understand prices being inflated at times. Now that I have a better understanding I'll be sure to check back from time to time.

Is there a feed, twitter or otherwise, that lists items & prices as they come up for sale?

Posted on July 28, 2014 at 11:03 PM
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