Easiest bet I've ever made! ;)

A question. What happens if you are able to do your grocery shopping say this year and the next 5 years, but after that the service disappears? Is it that you get 5 beers bought for you, but after that you need to start buying beers again?

I think if the ability to pay for your weekly groceries using crypto is still around in 5 years then it's probably still going to be around in 10 and 20 years, but I'd imagine there's a reasonable chance that it gets canned within the first couple of years and never makes it to 5.

Another question that was recently put to me was what happens when the major supermarkets stop home deliveries? I daresay those services are currently running at a loss, and the demand might be different now than it was during the depths of Covid lockdowns. I'm not suggesting that the supermarkets are running at a loss, just their home delivery services at this point where it seems to be about building market share at all costs, similar to what has happened with Uber Eats and the fast food delivery wars which has seen some casualties recently (competitors going broke or saying they can no longer afford to continue to trade, then ceasing to trade).

However with the Woolworths and Coles home (and business/office) delivery services, that is creating further sales from their core businesses and giving customers reasons to pick one over the other and then buy the vast majority of their weekly shopping from the one store (so building customer loyalty in effect), so it makes more sense for them to sustain operating losses in their home delivery businesses for longer because they are still making more money in their core businesses. I guess the main difference is that they are delivering their own goods from their own stores, rather than just being a delivery service for other companies (which is what Uber Eats and the like are).

Woolworths and Coles are fighting hard to win more and more home delivery (and office/business delivery) customers. I use both and the service is improving all of the time, as are the various savings you can make compared to regular in-store shopping, and Dan Murphys even deliver your beer to your home now (or any other alcohol you might prefer). DMs have been home delivering since well before Covid started actually. Woolworths and Coles have used the Covid-driven demand for home delivery in the last couple of years to kick-start their own home delivery services, but they are both clearly very serious about it, even building "dark stores" which are only there for home deliveries, so no retail customers are allowed in them, and there is no external advertising on the buildings. They are just basically mini-warehouses that have been optimised for the people who pick and pack home delivery orders.

Woolworths now deliver from 5am to 11pm, and Coles deliver from 4am to 11pm every day of the week, except public holidays.

And you can book deliveries up to 14 days in advance with Coles Plus, which is the name of their unlimited delivery service, which costs $19/month. As long as each one of your orders comes to at least $50, you can order as many times as you like, even multiple deliveries on a single day, and you pay no delivery fees at all, except for that $19/month fee.

Woolworths have a similar unlimited delivery service, but they only charge $15/month, and at this stage Woolworths allow you to order up to 7 days ahead only. While both Coles and Woolworths allow you to choose which products you are happy for them to substitute with other products if your chosen product is unavailable (OOS: out of stock) when they are picking your order, only Woolworths gives you the opportunity to enter a detailed comment if you want to regarding each and every item. So, if ordering 2L of A2 Milk, you could tick the "substitute OK" box and add the comment "Must be A2, but can be 2 x 1L or 1 x 2L, must be Full Cream. Thanks."

So I find myself not ticking the "substitutions OK" box for most products with Coles because I don't want to roll the dice on what they might send to me if my chosen product is OOS. But I use that option heaps more with Woolworths because I can say what substitutes are acceptable to me for that product. So Woolworths do currently edge out Coles on the basis that they have more optionality (and they are slightly cheaper - for their unlimited delivery option).

If they (Coles or Woolworths) substitute with an item or multiple items that cost more than what you ordered, you only pay the lower price. Similarly, if the substiute has a lower price, they refund you the difference. So you always pay the lower price. I often order Helga's half loaves of bread, which are often substituted with full size loaves because the smaller size is OOS. But I'm only paying for the half loaves regardless of what they actually give me. Or you could order a 4-pack of chicken schnitzels and receive a 12-pack instead, but only be charged with the 4-pack. That has happened a couple of times to me already. Trouble is we ended up throwing some out because there's only so much you can eat of one thing in a couple of days.

At this point, I would suggest avoiding their "Partner delivery" options, which are usually smaller timeslots (and cost more if you've not signed up for their unlimited delivery service). Those "partners" are usually Uber drivers or similar. They don't work for Coles or Woolworths and they are delivering your food using their own personal vehicle, which is not refrigerated. You can see examples of "Partner delivery" timeslots in that screenshot above - all of the 2-hour timeslots in the "Afternoon" section are Partner Deliveries, and are labelled as such. The others will be delivered by people who work for the supermarket chain driving their trucks, which are refrigerated and have a section for frozen foods that keeps them frozen.

I have had bad experiences with those "Partner deliveries" with both Coles and Woolworths, including having someone else's order left on my front porch along with that lady's name labelled on the side of each one of her shopping bags (but not her address or phone number). I tried to trace her to let her know but couldn't find her (using online tools). I rang the supermarket's home delivery "hotline" to complain and they organised for my order to be delivered the following morning, apologised on behalf of whoever had stuffed up, and said I could keep the other persons order, or donate it, or throw it in the bin. There was actually hardly anything we could use. Particularly the two large tins of infant formula powder. Our kids are way too old for that.

And because of the lack of refrigeration, ordering cold or frozen food using the "Partner delivery" options have often ended badly with food that goes off well before its use-by date. Also, Woolworths only uses paper bags now (no plastic) and the bags can be damaged and stuff can be falling out with the Partner deliveries.

The experiences when the orders are delivered by the Coles and Woolworths truck (van) drivers is usually much better. They are 95% cheerful, helpful and friendly. And about 80% on time. But everybody has a bad day sometimes.

Anyway, wayyyy off topic as usual...

Point being, the deliveries are here to stay, but the ability to pay for them with crypto? Not so sure about that one.

Funny how things do change over time tho, ain't it!?

We didnt get into that level of detail @Stuey727 -- but that sounds about right.

I have a question to do with the spending of crypto that I brought up with someone I went to school with who started "CryptoSpend" which is a wallet that allow purchases to be made like an Apple Pay with any eftpos machine.

That is, while the ATO still sees crypto as an asset of sorts, namely one which is subject to CGT - how the hell do you account for making daily transactions?

If I bought bitcoin in 2013 and have made a 50,000x profit that is yet to be locked in, and then I go and buy a coffee and breakfast every day for a year (so about $5,000) I would theoretically get a tax bill for realising my gains at a massive margin so we basically get down to me owing the ATO $1,000 just because I've spent it. I recall seeing a herald article about something like this becoming an unrealised problem with this use-case. The founder's response to me was "we can't give anybody tax advice" to which I responded "that's cool, but feels like a bit of a trap for everyone involved...watch out!"

Don't we need better legislation to just start using crypto this way in Australia at least?

Good question @Timocracy

The US is right now debating legislation that exempts transactions below a certain size. The reality is, it's super hard to police anyway, and doing so will probably cost more than whatever it manages to raise. And then there's accounting costs. So they kind of need to go that way, and I think that's what we'll see here too.

Another alternative is to just 'buy and spend' which is actually very straightforward already. I can convert from AUD to BTC and have it in my wallet in less than 5 minutes, and this level of functionality is rapidly growing/evolving. Strike already has full interoperability in many jurisdictions and we'll see the same here too eventually. That is, you can spend in BTC and the seller receives AUD. Or visa versa. Or any combination you can think of.

And there is good incentives for merchants to embrace this.

• New customer segment (bitcoiners). Look at the dynamics that helped drive the adoption of BNPL -- there's a lot of parallels i think.
• Instant and final settlement. Sure beats copping a bunch of chargebacks and waiting ages to actually get your money.
• Far -- FAR -- lower costs, with no minimum spend. As a merchant, would you rather pay 10-20bp or 200-300bp in transaction fees?
• Far more robust infrastructure. We've seen payment networks go down a few times this year in Australia after some banks had technical issues.
• Virtually no friction to adding such functionality. It will just be an optional module on existing point of sale systems -- you don't need to retool. Soon enough it'll be enabled by default. Or, just use your phone. Remember, one of the biggest payments companies in the world (Block) is actively pursuing this. Game theory would suggest others will be forced to follow suit.
• If they elect to receive money in fiat, BTC price volatility becomes irrelevant. Merchants can be entirely Bitcoin agnostic, and still leverage value off the network.
• Easier access to international customers. Receive money from anyone, anywhere, without all the usual costs and frictions.

Once you go beyond the "to the moon" get-rich-quick narratives, you realise that there's a very potent technology here. With very real and productive applications.

And, being open source, we're going to see a lot of cool stuff emerge.

What's got me increasingly interested is that much of this is moving beyond the "it's possible" phase to the "we're actually doing a lot of this stuff right NOW, and the pace of development and adoption appears to be accelerating" phase. Too early to say for sure, but I just think it's showing all the hallmarks of S-curve like adoption.

Apologies again for diverting focus from ASX specific stuff, but we've got a meeting on all this lined up for tomorrow night and I think these are the types of things we should put to our guest.

@Strawman that makes perfect sense.

PS I was under the impression that Strawman was an online private investment club. Not sure if that term has been coined before... So in my eyes this is all relevant to the longer term future.

Realistically, one of the steps down the line is to have the ability to use BTC to purchase company securities and then we would really be full circle. Like we need the quantum leap from always comparing the price of BTC to the cost of a USD. At the end of the day something costs what it costs in the native currency. We don't have a sticker on every bunch of bananas that says $3.99/kg AUD / USD $2.71 / 172 RUB / 18.95 CNY.

With a true currency use we really need to see it in the light of BTC being just another means of exchange. In some of the early days when pizza stores and even Tesla were accepting Bitcoin as payment it felt like a hot-potato scenario. They would take the BTC and then probably just convert it at end-of-day into the local currency but anybody that was taking BTC as an asset was at one stage taking a gamble because it was hard to bank that as a profit or even as revenue.

Further perspective, even as regular global currencies fluctuate we seem to see a lag of about 6 months or so if inflation isn't a problem.

When I was 14 and working at a music store. I lay-by(ed) a very nice USA built Fender Telecaster. It was about $2,500 and by the time I had paid it off and could take it home the USD had risen compared to the AUD and without any other cost pressures the AUD retail price went well past $3,500 and currently (with other factors and over 10 years on) the same model sits at just under $5,000 AUD.

I can imagine that once we get to a point where the value of one BTC stays relatively stable then it's only a matter of how much of the goods or service that one BTC can buy rather than relying on the conversion into local currency first.

Straying to a different analogy, when kids grow up in a bilingual household they will develop a twin-brain that sees each "object" as a quantum word meaning a picture of a pair of sunglasses would be both the word "Sunglasses" and "lunettes de soleil" and only be chosen when it needs to be communicated either with an English or French speaker. However someone who is learning the new language after a lifetime of only knowing English will have a slight processing delay while they think of the conversion from the English word sunglasses to the French term lunettes de soleil.

If that makes any sense at all, I feel like we need a big reset before BTC can become a widely adopted means of exchange that isn't first converted either literally through a wallet or subconsciously in people's monkey brains.

Some good fodder to dive into tomorrow night @slymeat

But I do want to challenge some things, briefly.

Re Myth 1. You can easily obtain non-KYC bitcoin and mask transactions via services like Coinjoin. Also, transactions are public, but the trick is to tie the address to a person. That can be very, very hard to do if someone has been careful. This is an active area of development and you'll see increasing privacy features being available in the coming years.

Myth 2. Base layer transactions, as you rightly point out, can take up to an hour before you can have full confidence that it has been adequately validated. (This is actually super fast compared to base layer transactions on the current system). But in terms of buying a cup of coffee, you need layer 2 solutions like Lightning -- something that can (and already does) facilitate instant transfer of small amounts. And, re myth 3, these transactions cost fractions of a cent. In fact, we don't have to theorise here -- each day hundreds of thousands of small transactions are already conducted over this network.

It can all get pretty complicated, and it's unfamiliar territory. But then again, if you want complexity just look at the legacy system! And, btw, this is a system that is also built on layers -- the entire global economy is ledgers stacked on ledgers stacked on ledgers..

Still, you are 100% right to stress that -- as things currently stand -- it is on you to keep good records and report accurately to the ATO.

If it helps anyone, I use CryptoTaxCalculator, an aussie software conpany, to manage my crypto tranactions and help avoid being raided by the all powerful ATO.

Its just like Sharesight, except for crypto! I googled around until I found a promo code.

I tested Koinly and CTC concurrently, and found the APIs, helpdesk, and functionality better suited me with CTC.

You've raised some interesting points there @slymeat about the Supermarket in-store selling tricks and product placement fees etc. Another thing they do is their store layout, so for instance ensuring that the basics such as milk and bread are as far apart as possible so that customers have to pass multiple end-of-aisle displays that encourage impulse buying. With online purchasing (for home delivery or click and collect), most people find what they are looking for using the search bar at the top of the webpage, and I reckon the order that search results are displayed is impacted by what they are trying to sell more of, whether that is because of fees charged to supplier for preferential product placement or another reason.

However, they do give you a number of filtering options, including the ability to choose how the results are displayed. Here is an example of a search on the Woolworths site for "Soap".

The default "Sort by" option is always "Relevance", which seems to mean "at Woolworths' discretion", but you can access that drop down menu displayed there to choose one of those other "Sort by" options which would certainly mean that companies paying for product placement (eye level in store, or top of search online) are obviously negated.

You can see that the top line contains 4 products (2 Dettol and two Anihana soap products) that have "Sponsored" marked between the product image and the product description. "Sponsored" products always appear at the top of every search but only when the results are sorted by the default search option - which Woolworths call "Relevance". As soon as you choose one of the other "Sort by" options, the "Sponsored" products then appear as per the choice you've made, so in order of product name, or price, or unit price, etc.

Both companies also have a "Did you forget..." page which pops up when you decide to go to checkout, before the checkout screen will display. The products displayed on that page are based on your previous purchases, although I've noticed that some items are never added, like milk, so I'm guessing the site has a minimum profit margin filter or something for what it chooses to display there. The Woolworths one works really well and I notice that many items that I've bought most weeks and then not bought this week are there to prompt me to buy them this week as well - in case I had forgotten to add them. The Coles one is rubbish. For months it only had one item on it - Ricotta Cheese - which I'd only ever bought on two occasions, and lately that list has grown to about 4 items and I can't see what the relevance of those 4 items are except they probably have a decent profit margin for Coles if I buy them. The Woolworths one always has around 20 items on it, and if I add some of those items to my cart, it replaces them with other items I've previously bought. One things that is good about Woolworths' "Did You Forget..." page is that it lets me know if anything I regularly buy is on special this week because obviously all prices are displayed and anything that is on special or has had the price reduced for any reason is highlighted.

Both companies spam me regularly with emails about specials, including some online-only specials, and also discount codes. For instance, if you are a Woolworths Rewards member - which is their version of Coles Flybuys - and why wouldn't you be, since it's free (apart from obviously the data collection aspect of it, but if you're doing online shopping they know everything you buy online anyway), but I digress, where was I? Oh yeah, if you're a Woolworths Rewards member, you can get 10% off the total of one online order per month by using the relevant discount code, which is always obvious. And you can choose which shop to apply that discount code to. Hopefully that would be your largest shop that month. The code for December is "DEC2022". Last month it was "NOV2022" - you get the idea. I've placed a $290 order yesterday for delivery on Saturday morning (in 3 days time) and used that code so got $29 off the order. I also used some of my rewards points to reduce the total by another $10 - they let you know (on the checkout page) automatically every time you have enough points to do that - as I think they also do instore as well - at the checkout.

At this stage Coles do not do that with Flybuys when using their Coles online ordering system (for home delivery or for click-and-collect). You would have to redeem your flybuy points for a Coles giftcard or electronic giftcard (e-giftcard) on their Flybuys site and then enter the giftcard details at the checkout when online shopping to get the reduction. With Woolworths it's all automatic - you are told when you have enough points and with 2 clicks you can reduce your balance owing using those points.

Both companies also have regular "one-off" discount code promotions, such as $50 off one order once you've spent $190/week every week for 4 weeks, or a $20-off voucher for any shop where the total comes to $220 or more (that number changes, it might be $200 or $250). Those sort of offers seem to come along at least once every couple of months from each company, and they can usually only be used once by each registered customer in that month. The Coles offers generally have a higher bar in terms of how much you need to spend (minimum order amount) to get the discount. In general Woolworths seem to be more generous with their promotions.

Woolworths website and their online offering is (in my experience at least) faster and better, and cheaper - for the unlimited delivery service, and they also have a better SMS (text message) service that tells you the target hour within your designated delivery timeslot they plan to deliver your order, followed by a "your order is next in line for delivery" message, followed by a "your order has been delivered" message. Coles send me an email to give me their target hour, and then one to say the order has been delivered. Both companies allow unattended deliveries if you tick that box when ordering, so you don't actually have to be there, or you can come out and collect your order after the delivery driver has left if you prefer (such as if you are Covid-positive or are scared of coming in contact with someone else who might be). That "unattended delivery" service is clearly not available for alcohol or any other products that have age restrictions attached to them. Neither company sells cigarettes online, however both do sell Nicorette "Quit Smoking" Nicotine products (patches, sprays, gum, lozenges, etc.). Both companies sell alcohol, although that is supplied by their partners, which in Woolworths' case is Endeavour Group (Dan Murphys, BWS, etc) and in Coles case is Liquorland and First Choice Liquor. The availability of the alcohol strongly depends on the delivery timeslot and delivery method you choose. For instance, it can't be early morning, and it can't be delivered by one of their "Delivery Partners". Also, you have to be there to have alcohol delivered and provide ID and proof of age if requested [I think my grey hair negates the need for that]. I tend to buy my alcohol directly through Dan Murphys - because it's generally cheaper that way. Small orders I will click and collect from the DM store that is just around the corner, larger orders where they offer free delivery I'll get it delivered.

But there is clearly a huge difference between selling online and selling instore, in terms of the fees that can be charged, the tricks that can be used, and even the people it takes to make it work, and their respective jobs. As a quick example, when I was working for Coca Cola there was one occasion where each of the factory workers (which I was) had the opportunity to do a "ride-along" with somebody who worked out of the office, such as in sales or purchasing. I got to spend a day with a "Merchandiser", which was one of the guys who support the account managers or BDMs (Business Development Managers) to keep all of their customers happy and selling as much of Coke's products as possible. We visited a number of supermarkets and smaller shops and spoke to different managers finding out what their concerns were, taking notes, and forwarding messages onto the relevant people, did store inspections, and set up displays which sometimes involved putting together cardboard cut-outs (that highlighted either a new product or a special offer for an existing product) and setting them up at the end of certain aisles with a number of cases of a particular product or range of products. What surprised me was that most of the day was spent doing the store inspections, which involved checking that all Coca Cola brands were in the correct designated sections, displayed correctly, product labels facing forwards, and so forth. That even meant twisting every bottle and can in the drink chillers so that the product name was front facing.

There were also occasions where we had to talk to management about removing non-Coca-Cola products from Coca-Cola fridges and drink chillers, or we just went ahead and did this ourselves. This only happened in the smaller stores because you don't find Coca-Cola fridges and drink chillers in larger supermarkets. Wherever you do find them in-use in stores, they always remain the property of Coca Cola and they can be used by the store for free on the conditions that ONLY Coca Cola products can be placed inside that fridge or chiller, and that the images and branding on the fridge/chiller remain visable and undisturbed (so they can't stick notices over any part of the branding or obscure it from being read by customers). Pepsi-Schweppes do the same thing. If they find any Coke products in their fridges or chillers they take them out. So these "Merch" people weren't the account managers, or even the people who come up with the promotional ideas or design the promotional material. These are the people who go out into the stores and do all of the manual stuff. We usually had to wear a badge with "Visitor" on it, or some stores allowed the Merch guy to wear his standard Coca-Cola name badge. But they didn't want customers confusing us with their own store staff. And the Merchandisers don't want that either or they'd be constantly asked which aisle such and such is in, etc., and never get anything done.

If we were to assume for the sake of argument that hypothetically half of supermarket sales move online, that would certainly have a significant impact on a number of those types of roles. New roles are created with online, but as a general rule there are less people involved in the selling, and more in the actual delivery of what has been sold. And I daresay that it may level the playing field somewhat in that product manufacturers and their respective sales teams can't get/buy some of the competitive advantages they may have been able to obtain in-store. The supermarkets still get to choose what products they sell, and at what prices, but a fair bit will change - or has changed - for everybody else.

@slymeat @Strawman Farout I love a healthy discussion. No mud flinging either, I like it!

My $0.00000072 of bitcoin (2 cents...get it?) on the whole cup of coffee scenario was about how many purchases would build up to an unexpected tax bill. As we know with trading securities frequently it is hard to keep a record of cost bases and sale prices. Then the whole 50% discount thing and which tranch you assign it to if you're a relatively frequent buyer. Jeez. I wonder what the maths is on someone who converted their AUD/USD salary into BTC each fortnight for the last 10 years....

Anyway, isn't a reason that these Tyro/Square/CBA terminals all got massive improvements recently because even credit card purchases didn't end up in the cafe's account for a few days? Weekends were worse! Surely BTC would be as quick if not quicker in the near future.

Plus, if we're talking about having BTC become our standardised digital means of exchange then it's not just yachts and Lamborghinis - it's the everyday stuff. Until you can buy a $1,000 PS5, a $70 pair of jeans and a $2 IKEA hotdog, people aren't going to want to use BTC for some purchases and their digital central bank currency for others (Apple Pay, tap and go).

I used to own a small convenience store in the UK, another selling tactic is the fruit and vegetables at the front of the store.

A lot of thought is put in to this, fruit and vegetables Items are often loss making, what their placement does though is provides a bright, colourful and enticing entrance, but due to the oddly shaped and loose items you would choose to get a trolley, then purchase bread and milk as already stated, its at the back of the store or as far away as possible from each other, if your getting a trolley, well you might as well do a proper shop so to speak.

Supermarkets using psychology to empty our pockets.